"As the tech industry has matured, some technology companies are beginning to devote some of their cash flow to dividends," explains George Putnam, who notes, "This helps reduce downside volatility and offers some positive return when the stock prices lag."

In his industry-leading The Turnaround Letter, the advisor highlights some dividend-paying tech stocks; here a look at three of those picks.

"Many tech stocks have underperformed for the last couple of years as capital spending on technology products has been weak. The sector will eventually rebound, but the timing is far from certain.

"A conservative way to play the industry is to focus on technology stocks that pay dividends. That way you at least get paid something while you wait for the rebound. The following technology stocks pay decent dividends, many of them higher than the average 2.1% dividend paid by the stocks in the S&P 500 Index.

Last December, over 100 stocks were featured in our Top Picks for 2007 report. Now, at mid-year, we turn to the 20 advisors whose picks showed the strongest gains to get an update on their previous picks, as well as a new favorite stock for the second half of the year.

Mark Mowrey, editor of the Prudent Speculator TechValue Report, chose Cogent Inc. (NASDAQ: COGT), which rose 41% as of June 1, 2007. Although he maintains a $24 price target for those who own the stock, he no longer is recommending purchase.

For his new top idea, Mark looks at United Online Inc. (NASDAQ: UNTD). The advisor explains, "For as many reasons to be wary of the company, we find more to like about this net-centric company.

"Founded as Juno Online Services in May 1995, and formed via the merger of that company with fellow dial-up Internet services provider NetZero in June 2001, United Online is one of a select few surviving early Net access players.

"As UNTD milks the dial-up business for cash flow, management hopes to transition as many of those paying customers as they can to a new broadband offering. Still, revenue from the communications segment is declining at a rapid clip, falling 13 percent in 2006 to $375.9 million.

"So what is there to like about a company with declining revenue in its core business, the only savior for which is entry into an even more competitive space? The general answer is the provision of services folks utilize once they're already on the Net.

AOL's Access division is reponsible for trying to get broadband AOL consumers. It's been a huge struggle as AOL has to pay the broadband companies providing the connection a fee, cutting into their profit margin. Secondly rumors are that RoadRunner cable and AOL Access haven't exactly been getting along, as Tech Dirt points out.

CNET points out that AOL Access faces a crunch. Dial up users are converting to broadband via local cable companies already, thus trickling away. Second is that local cable companies are grabbing a lot of the early switchers to broadband, meaning AOL is either fighting to keep the customers it has and switch them to broadband with a slight loss in profit, or trying hard to woo existing customers away who aren't interested in broadband because they're reluctant to change.

Now comes a big rumor via Valleywag that AOL's Access division is going to make some massive cuts come in August to early October of this year due the lackluster broadband performance.