News and analysis to 1st March 2007
The wow starts now(ish)
After two years the wait is over. Microsoft Vista has hit
the market, as has Office 2007. Both are critical products in respect of
Microsoft’s revenues and grip on the market. The launch took place at the Nokia
Theatre in Times Square. Steve Ballmer and Bill Gates worked the crowd into a
frenzy. This is the biggest product launch since Windows and Office 95. Though
functionality wise 12 years later the most significant difference is an
irritating paper clip. Businesses are unlikely to rush to acquire the new
products unless they are susceptible to marketing messages, enjoy bug reporting
or have been made an offer that they cannot refuse.
Accenture ups Indian headcount
IT off shoring and market chameleon Accenture is on the
verge of having a larger Indian headcount than in the US. Indian recruitment
companies need to be braced for Accenture’s planned acquisition of circa 8,000
staff. The major IT service companies are playing a similar game. Possibly they
have lost sight of the fact that their talent feeding frenzy will send salaries
skywards, which will ultimately undermine the ‘low cost’ location objective.
Oracle ConFusion
Rumour has it that Oracle is considering a bid for rival
Sap. The rumour was oddly specific as it also included an offer price of $49.78
per Sap share, which sent Sap’s share price up by almost 2%. Microsoft has
already displayed amorous intentions towards Sap but felt that the complexity
of coupling would offset the benefits. So the fact that Oracle might consider
this is astounding, given that it is in the process of digesting PeopleSoft, J
D Edwards and Siebel, amongst others. Typically Oracle would see this as a
detail as its number one business objective is getting one up on Microsoft
Dell 2.0
PC maker Dell needs a complete makeover. The recent poor
quarter was the final straw that led to the abrupt departure of CEO Kevin
Rollins. Under Rollins’ watch the share price slumped, market share leadership
was handed over to HP and the company found itself under scrutiny from the SEC
for possible accounting irregularities. Though not exclusive to Dell, the
exploding lap top range in 2006 was not a brand enhancer. Oh and we mustn’t
forget the $1bn ‘kickback’ class action law suit relating to Intel’s alleged
scheme to encourage use of its processors rather than those of rival AMD.
Founder Michael Dell has taken up the reins again. His reference to Dell 2.0 is
a play on the hot topic of Web 2.0, which ironically will accelerate the demise
of the PC. Though this might be interpreted as Dell’s withdrawal from desktops
and laptops into servers and storage rather than just a mistake from a
hype-fixated marketer. We’ll see.
India – Fast forward
As if the Indian IT service companies were not growing fast
enough (exports of $31bn in the last 12 months; up 33% year on year), the
Indian Prime Minister Dr Manmohan Singh has urged the Indian players to aim for
even greater growth in the next five years. He urged that by 2010 India should
be looking at exports of $80bn. Dr
Singh recognises that this growth needs to embrace not just the current handful
of high profile Indian techno-cities, but also the lower tier cities and even
villages. The Indian service companies will also need to be able to cope with
the internal demand generated by the Indian government’s movement online. The
big issue, as usual, is people. Even India is not producing skilled
professionals at the rate needed to support these plans. With this in mind,
India plans to overhaul its education system and to create IT finishing schools
to ensure those entering the IT market are of industrial strength. Nations
interested in competing with India in the IT arena should take note, as should
those who perceive India as a ‘low cost’ location for IT skills.
Drive-by pharming
You thought you were a safe distance from the drive-by
action in the ‘projects’ or the ‘barrios’. Well think again. Security
researchers have uncovered a way to compromise home networks using a technique
called pharming. which uses bogus websites to capture your security details and
so on. This is a step up from phishing, where savvy users will spot the unusual
domain name in the address bar of the browser. Pharming as a technique is not
new, but up until now has involved penetrating the domain name servers of ISPs,
which is a challenge. So-called drive-by pharming exploits a weakness in the
home user’s router. I believe this is also an opportunity for creating a new
gangsta rap variant. Henceforth I want to be known as 50 megabytes. And if you
mess with me I’ll pop a cap in your routa.
US talent market hots up
IT is the place to be in the US, according to technology
career website Dice, which has just polled 19,000 IT professionals in respect
of salaries. There was an across the
board salary rise of 5.2% in 2006. Notably workers in the financial sector
where up 8%, retail/e-commerce up 14% and public sector up 9%. Women earned 7
to 12% less than men. The disparity is highest in the medical sector and lowest
in computer manufacturing. There is a definite tightening of the market. IT
became a less exciting degree option once the possibility of becoming a dotcom
gazillionaire vanished. Technology companies switched off the training budget
during the post dotcom nuclear winter. And now key management is approaching
retirement. This triple whammy will create aridity in the IT personnel market.
IT recruiters are going to need to raise their game as the talent war steps up
in intensity.
Vista – Defective by design
This harsh sobriquet for Microsoft’s new desktop operating
system was coined by the UK’s Green Party, which has both user disempowerment
and environmental concerns. They believe that the new digital rights management
(anti piracy) software places too much control in the hands of the vendors,
rather than the consumer. Ultimately it gives Microsoft the right to lock you
out of your own computer. Vista’s heavy processing requirements will supposedly
lead to a landfill nightmare as business and consumers dump their puny hardware
in favour of Vista-strength technology. This is prompting the Green party to
press the UK Government to promote the use of free software in order to squeeze
more life out of existing hardware.
