5 Companies That Had A Rough Week

The Week Ending June 5

This wasn't a good week to be a top executive in some leading IT companies. Struggling NetApp ousted CEO Tom Georgens and named George Kurian executive vice president of product operations, to take over the storage system company's top job. Cisco's two presidents are leaving after incoming CEO Chuck Robbins disclosed plans for a "flatter" management structure at the company. And in what partners see as a loss for Juniper Networks, the company's security chief technology officer is heading for the door.

Also having a bad week was the latest high-profile cyberattack victim, the U.S. government's Office of Personnel Management, and a leading systems integrator that's paying millions of dollars to settle SEC fraud charges.

Not everyone in the IT industry was having a rough go of it this week. For a rundown of companies that made smart decisions, executed savvy strategic moves -- or just had good luck -- check out this week's Five Companies That Came To Win roundup.

Struggling NetApp Ousts CEO Georgens

Storage system vendor NetApp this week disclosed that Tom Georgens (pictured), the struggling company's CEO for nearly six years, had left the company. Executive vice president of product operations George Kurian was named the new CEO effective immediately.

No reason for Georgens' departure was given. But last month the company reported significant declines in fourth-quarter sales and earnings, a slowdown in its U.S. commercial business, and a drop in sales through the channel.

Juniper Networks Loses Security CTO

Juniper Networks has had something of a revolving door in the past year-plus, with many top executives and channel managers leaving the company. This week Christofer Hoff, chief technology officer for the company's security, switching and solutions business unit, disclosed in a blog post that he is leaving the company.

Juniper has been trying to expand into the enterprise security market and get away from the perception that they are just a network security company that caters to carriers, observers say. Attaining that goal won't be any easier with Hoff's departure. In April the company reported that its first-quarter security sales fell more than 30 percent year-over-year.

U.S. Government Security Breach Compromises Data On 4 Million Federal Employees

U.S. officials said Thursday that hackers broke into the computer system of the Office of Personnel Management and compromised the personal data of as many as 4 million current and former federal employees. The intruders gained access to employees' Social Security numbers, job assignments, performance ratings and other data, according to a Washington Post story.

The attack, which officials said occurred in December but wasn't discovered until April, is believed to be the largest breach of federal employee data in recent years. Some reports said U.S. officials suspected the hackers work for the Chinese state and that this incident is the second major intrusion of the same agency by China in less than a year.

CSC To Pay $190 Million To Settle SEC Fraud Charges

Computer Sciences Corp. will cough up $190 million to settle accounting fraud charges in a long-running case brought by the Securities and Exchange Commission. CSC, however, is neither admitting nor denying the SEC's findings, CSC told CRN.

The SEC charged CSC with manipulating financial results and concealed problems about one of its largest contracts, a project with the U.K. National Health Service. CSC, which had missed deadlines and was set to lose money on the contract, was alleged to have added items to the company's accounting models that artificially increased profits, according to a Wall Street Journal story. CSC also was accused of using some accounting on proposed amendments to the NHS contract, rather than the actual contract, and so avoided significant earnings reductions in 2010 and 2011.

Solution Providers: New NSA Controls Fall Short Of Restoring Trust In Cloud Services

Congress this week wrapped up legislation to curtail unbridled government surveillance by the National Security Agency. But solution providers told CRN that Congress's efforts fall short of what is needed to restore client trust in cloud services.

Solution providers have been feeling the effects of revelations of the NSA's surveillance program since it was revealed in documents leaked by former government contractor Edward Snowden in 2013. Cloud-focused solution providers in particular have told CRN that they have faced tough questions from customers around security for cloud-based data and were working hard to re-establish trust with their clients.

Solution providers are disappointed that the new U.S.A. Freedom Act does nothing to prevent U.S. authorities from gaining access to cloud data of foreign companies operating in U.S. cloud services. So businesses operating outside the U.S. must continue dealing with conflicting regional laws and regulations if they move data into the U.S.