5 Companies That Had A Rough Week

The Week Ending Feb. 5

Topping this week's roundup of companies that had a rough week is distributor Arrow Electronics, which was the apparent victim of a $13 million money transfer theft.

Also making the list were Arista Networks, which was on the losing end of a judge's patent ruling; Barracuda Networks, which is shuttering some cloud services; SMB telecom customers dumped by service provider Windstream; and Microsoft for its less-than-stellar technology performance at the Iowa Caucuses.

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 5 Companies That Came To Win roundup.

Distributor Arrow Out $13 Million Following Unauthorized Money Transfer

Criminals managed to impersonate an Arrow Electronics executive recently and transferred money from the distributor to outside bank accounts in Asia, Arrow disclosed this week in a filing with the U.S. Securities and Exchange Commission.

Arrow said the criminal fraud would cost the company $13 million in the first quarter of this year. The company determined Jan. 22 that it had been targeted and both internal and criminal investigations were launched.

While the investigations are continuing, Arrow said the findings thus far indicate that the event was isolated and not associated with a security breach or loss of data.

Arista Loses Patent Ruling, Partners On Edge

A ruling by the International Trade Commission this week that Arista Networks infringed a number of Cisco patents has Arista partners worried that imports of Arista networking products might be halted.

The ruling by Administrative Law Judge David P. Shaw was in regard to a lawsuit Cisco filed in 2014 claiming that Arista, a networking startup, infringed several Cisco patents. Shaw determined that Arista had, in fact, infringed three of five Cisco patents pertaining to private VLANs, system database and "externally managing router configuration data with a centralized database."

While Shaw did clear two of Arista's software features, Cisco is hoping the ITC will make Arista stop shipping its networking switch products into the U.S. from overseas until the offending technology is removed or modified. That has Arista partners worried.

Barracuda Shutters Cloud Services, Could Be Up For Sale

Storage and security vendor Barracuda Networks disclosed this week that it is shutting down two of its cloud-based data protection and file sync and share services. The company will discontinue its Copy.com consumer-focused service and CudaDrive business-focused service on May 1.

In a blog post, Rod Mathews, vice president and general manager of Barracuda's storage business, said the company is "constantly evaluating" the company's product portfolio to "focus our resources on our most strategic initiatives." But Barracuda didn't say more about the reasons behind the decision.

After hitting a high of $42.74 a share last June, Barracuda's stock has fallen to below $11 in recent weeks. This week Bloomberg reported that the company has asked Morgan Stanley to seek potential buyers and gauge interest in the company.

SMB Customers Cut Off By Windstream, Partners Scrambling

Telecommunications service provider Windstream has been cutting off sub-$1,500 monthly accounts, making good on a plan it disclosed in December to trim its subscriber roster and focus on bigger customers. A total of 171 customers were told that their bills would "increase significantly" if they remained with Windstream.

That's left some SMB customers – and the service providers they work with – scrambling to find alternate suppliers.

Cheers, however, for service providers like ACE Consulting Group of Fairhaven, Mass., which has stepped up and helped customers find alternate telecommunications service providers.

Microsoft Vote Tally Website Fails During Iowa Caucus

The Microsoft website used to tally votes during Monday's Iowa caucus ran into a number of glitches and people took to Twitter and other social media sites to complain about the system's performance.

The system included a mobile application used to collect caucus votes and stored them in Microsoft's Azure cloud service. From there the results were posted on a Microsoft-run website, according to stories on USA Today and the International Business Times.

Microsoft said the applications worked as expected, but the overwhelming interest in the caucus results caused the websites tallying both Republican and Democratic votes to crash.

Still, it was a high-visibility system failure. "Add 'Iowa Caucus vote tracking' to Microsoft's long list of unsuccessful promotional efforts…" wrote Michael DeGusta on Twitter.