The new Big Boy in IT?

I read this article with great interest. HP is going to end this year at around $100 Billion… What a turnaround for this company! Interesting also would be that it makes HP the BIGGEST IT company , taking over from IBM, the defacto leader in the Industry… Now that is something for a company everyone thought had lost its way.. (remember HP=Printer company… ). The Compaq purchase WAS worth it. On a personal note though, the HP Smartphone I have, is a dummy!!! (a piece of brick, as I like to call it!).

The news article: HP reported a great quarter Wednesday. Revenue jumped 13 percent, to $25.5 billion, helped by tremendous sales in industry-standard servers, PCs, and the hot laptop market. HP forecast revenue to increase to $100.5 billion to $100.9 billion for its fiscal year, ending Oct. 31. The prior forecast was $98 billion to $99 billion. If it hits its new revenue target, it would be approximately a 9 percent increase over its 2006 revenue. Most companies HP's size are expected to grow at 6 percent at the most.

Offshore Model in India evolving

I read this article in Infoworld with interest. This is from IDG… What this article does not necessarily address is that Indian Outsourcing Industry is also at a crossroad now. The salary structures in India has reached levels, where it makes it expensive to outsource to India on pure cost basis. Some companies like TCS and Infosys, have already started thinking ahead, and they are proactively opening up outsourcing/development centre (call it what you will), in other "emerging" countries – like Eastern Europe or even China ("Emerging" for Development related work). NOW, that is an interesting take on the state of the business. Imagine, a company sitting in Europe, outsources work to a company in India, which actually does many of the work out of East Europe – which could be just next door!!! J Here is the article… a snapshot of it. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (InfoWorld) - Foreign companies aiming to take advantage of India's less-expensive IT and back-office employees often take one of two routes -- they set up their own operations in the country, commonly referred to as "captive centers," or they outsource work. But new market research suggests there are cost benefits to turning over software development or business processes to an outsourcer rather than setting up a subsidiary. Forrester Research Inc. found that hidden costs raise the baseline expense per person per month at a subsidiary to $4,944, compared to the baseline cost of $4,231 per person per month to hire an outsourcer. A number of companies are shutting down their captive centers and turning to outsourcers, said Sudin Apte, senior analyst and country head for India for Forrester. "Captives centers run as cost-centers and cannot be as competitive as a vendor offering services," Apte said. The size of the captive center also matters. "My experience suggests that generally the minimum economic size for a captive operation is about 1,000 staff," said Siddharth Pai, a partner at outsourcing consultancy firm Technology Partners International in Houston. A smaller staff means the expenses of real estate, infrastructure, and other overhead keep the cost per person at levels too high to appeal to the parent company, he added. More than 60 percent of the captive centers in India are struggling with escalating staff attrition and costs, according to Apte. Most of these centers have been set up with the expectation that they can do the work more cheaply than outsourcers as they will not be paying vendor margins. Money saved on the outsourcer's margins is outweighed by the inefficiency of the captive operation, he added. Because they usually don't do leading-edge work, subsidiaries spend more than outsourcers to attract and retain staff, according to Forrester. Conversely, outsourcers provide staff growth opportunities and the chance to work on a variety of projects from various customers, Apte said.

 

Microsoft

Microsoft has at last started its upward spiral. Nothing but a ton of innovation to a market that just does not reward innovation- the hard work begins to pay off… Way to go, MS.

 
 

 
 

Cambodia Visit

First trip to Cambodia. It was a very interesting trip. Considering what people had told me about it.

"Dirty, no good roads, poor country, no infrastructure, unsafe, dangerous" etc. etc.

With that background, I went in with a bit of trepidation. And it turned out to be one of the more pleasant surprises for me. I landed at the airport expecting it to be some old building and was absolutely stunned to see a well designed albeit small, airport which was on par and in most cases better than many of the airports in the Region. The city was impressive considering what my mental picture of the city was. Well planned and people who mostly were very friendly. The roads were good! (so much for "mud roads"). I went out for dinner with a couple and the restaurants were good, well organized (along the river), and mostly looked safe J

What I was most impressed with, was the SIZE of the houses! I just cant get over it. They were HUGE houses, and more interesting- almost all of them COVERED with Metallic posts to avoid thieves (was that the "safety" issue everyone spoke about?).

For a country with such a painful history, the people looked at peace with themselves, and helped where they could.

Most understood English and spoke it much better than the Vietnamese do.

All in all a memorable trip which I enjoyed and I hope to go back – this time to see the Angkor Wat temples.

Here are some snaps.. Yeah, the traffic was a challenge J

Robo Repo – Car Buyers Beware

This came in Business Week – May issue

"Car buyers with lousy credit have a new digital rep man to worry about. Sekurus, a Temecula technology firm, is racking up sales of its On Time device, a $250 under-dash gadget that disables a car's starter if the owner falls behind on loan payments. Its main customers are car dealers who cater to subprime borrowers! "

This to me was very interesting news. A reminder service is great –but something that disables the owners car, is something quite something. Interesting are these times- when we get technology supporting us for the oddest things… what next? If you default on your home loans, the doors don't open anymore?

Another thought – does it affect the equity of this brand?