GlobeSpotting with Steve Hamm - BusinessWeek

India Prepares for the (Eventual) Turnaround

Steve Hamm — Fri, 10 Jul 2009 14:26:44 -0500

Just a bit of good news out of India today. Infosys, which is the first of the large Indian tech services outfits to report earnings each quarter, came in with better-than-expect results. In dollars, the company had revenues of $1.12 billion and net income of $313 million. The company had forecast a revenue decline of 4% to 6%, in constant currencies, but revenues declined just 1%. Operating margins actually improved. That's partly because Infosys fired more people during the quarter for poor performance. Normally, it gives people who get poor evaluations six months to improve, but now, in the midst of the recession, it cut some people loose immediately.

Infosys CEO Kris Gopalakrishnan says the results validate the company's strategy for the downturn. Infosys has continued to invest in developing intellectual property, expanding its sales force, and, overall, hiring and training 18,000 additional staffers this fiscal year. The company is establishing a new global delivery center in Brazil, too. The idea is to be ready when demand picks up again. "If you're well prepared, you'll benefit and grow disproportionally," he says.

It's still a gamble, though. An informal survey by Infosys of its customers showed increasing concern about the tenacity of the recession. At the end of the last quarter, 46% said they don't expect an economic turnaround until after March of 2010; in the most recent survey, 54% gave that answer. If the recession drags on longer, Gopalakrishnan and his colleagues may have to rethink their aggressive investment and hiring strategy.

The Gold Rush in GPS-based Mobile Phone Services

Steve Hamm — Thu, 09 Jul 2009 09:02:36 -0500

Now that GPS and compasses are standard equipment in most smartphones, the rush to provide innovative location-based services is on. These are pioneering days. Beyond a few no-brainers like basic navigation, nobody knows exactly which services will get traction. The next phase of the competition between the smartphone makers like Apple, RIM, and Nokia will be for the hearts and minds of the location-based service creators.

One of the industry pioneers is John Ziskind, co-founder and CEO of ZOS Communications. Ziskind honed his competitive edge as an Americas Cup sailor, where he lived and breathed GPS pinging to keep the boats on track. ZOS Communication's core technology is server software called the ZOS engine, which integrates location and other data and delivers it real time to mobile devices via wireless networks.

The company's first service, launched a month ago, is Zhiing, a location-based messaging service for consumers. Using an instant-messaging-like interface, people can send and get turn-by turn directions to a location and information about what's nearby. Ziskind also plans services for businesses and government agencies. For instance, a Rochester ambulance company is testing the technology for use in locating victims fast.

Ziskind and his colleagues had some big decisions to make as they developed their technology and services. Chief among them was which smartphone platforms should they design services for. In the end, they did the incredibly hard thing of writing services for all of the major platforms: RIM, iPhone, Android, Symbian, and Windows Mobile. Most startups will probably pick two or three, for starters.

Ziskind's experience with RIM shows just how willing the big players are to provide help for promising young startups. ZOS chose RIM as its primary development platform because of its dominant share of the enterprise smartphone market. It took about six months of persistent calling for Ziskind to get RIM's attention. ""I'm relentless," he says. "You've got to be if you want to participate in something like the Americas Cup." But finally he broke through and has developed what he thinks of as a partnership with RIM. His engineers get to tap directly in to RIM's product development engineers, and ZOS got early access to RIM's Blackberry Push technology. The result of all of this collaboration, Ziskind says, is super-accurate positioning.

ZOS has cleared its first hurdle. It has its basic technology built and has launched its first consumer service. An enterprise service is due out later this summer.

Now Ziskind is looking for venture funding. (The company got this far with angel money.) If Ziskind goes after venture capitalists with the relentlessness he pursued the smartphone makers, he shouldn't have anything to worry about.

Egypt's Bid for Global Technology Relevance

Steve Hamm — Thu, 02 Jul 2009 15:43:31 -0500

Practically any developing nation with more than an iota of applicable resources and economic ambition wants to put itself on the global IT map. After all, India showed what the combination of talented young people, Internet access, and reasonable broadband data communications tariffs can do for a country's self esteem and GDP growth. Egypt, it turns out, is making a particularly aggressive play for attention. I met recently with Tarek Kamel, Egypt's minister of Communications and Information Technology. He gave me an earful about Egypt's plans and ambitions. And this isn't just talk. The country is starting to get traction--and has put a foundation in place that could lead to some pretty significant progress a few years down the road. Egypt's ambition is nothing less than to be the IT hub for Saharan Africa and the Middle East.

Google's Values at Work in Africa

Steve Hamm — Mon, 29 Jun 2009 00:02:31 -0500

Google's mission is to organize the world's information and make it universally accessible and useful. It took a big step toward universal accessibility today when it launched a program in Uganda aimed at bringing information to poor rural and urban dwellers via mobile phones. Working with Grameen Foundation and MTN, the big African mobile carrier, Google has begun offering a handful of services that combine text messaging, search technologies, and databases full of locally relevant information. "We believe that finding information shouldn't require a computer," says Joseph Mucheru, head of Google's operations in sub-Saharan Africa. Richard Mwami, public access manager for MTN Uganda, says: "This will help solve a great need at the bottom of the pyramid." This project is a prime example of smart people scoping out a problem thoroughly and coming up with a technology and service solution that fits the needs and economics of a poor community. Bravo!

On Vacation

Steve Hamm — Fri, 26 Jun 2009 15:38:52 -0500

I'm going to be on vacation until July 7. I'm posting a couple of items in advance, but will not be able to attend to comments until I come back. Our technology security policies make it hard to get access from the road.

Richard Branson: Where Have All the Colorful Tech CEO's Gone?

Steve Hamm — Thu, 25 Jun 2009 16:08:20 -0500

The tech industry used to be full of colorful and dynamic CEOs. Not so much anymore. That makes it much less fun to be a tech industry reporter. I was reminded of this falloff when Sir Richard Branson visited BusinessWeek this week. Probably 30 BusinessWeek reporters, editors, art directors, and interns packed a conference room and there was a buzz of excitement before the brash ("Screw it, let's do it," is his business motto) businessman made his entrance 15 minutes late. Branson did not disappoint. He was alternatively funny, provocative, charming, and slightly too self-satisfied.

Infosys' Nandan Nilekani to Become an Indian Cabinet Minister

Steve Hamm — Thu, 25 Jun 2009 15:21:39 -0500

Nandan Nilekani capped off more than 25 years in the top executive ranks at Infosys earlier this year by publishing Imagining India, a book in which he passionately called for governmental and cultural reforms. Now he'll get a change to act on some of his own advice. Word came down minutes ago that Nilekani, Infosys' co-chairman, has been appointed as a cabinet minister in the Indian government. On July 9, he'll take over as Chairperson of the Unique Identification Authority of India, which is similar to the U.S. Social Security Administration.

Nilekani was one of the co-founders of Infosys in 1981 and served as its CEO from 2002 to 2007--a period when Infosys and the entire Indian tech industry exploded onto the world stage. He has been an articulate spokesman for an industry and a point of view--that thanks to the Internet and lower data communications costs, knowledge work can now be done anywhere in the world where the talent exists. A revolutionary thought. It was he who awoke New York Times columnist Thomas Friedman to the disruptive changes that are taking place as a result, telling him famously that "the world is flat"--which led to Friedman's book with that title.

I reviewed Nilekani's book before it came out, and, given the amount of work and thought and passion he put into it, I'm not surprised that he has agreed to serve in government. Given the kind of frustrations that his Infosys co-chairman, N. R. Narayana Murthy, has experienced in his forays into state government affairs in Bangalore, Nilekani goes into this fully aware of the potential pitfalls. So he must think it will be well worth the trouble.

My only question is: Why this posting? It seems like commerce secretary or communications and technology minister would have been more appropriate. I've sent him a message asking for an interview, and, hopefully, that and other questions will be answered soon.

By the way, GlobeSpotting loyalists may recall that Nilekani was a guest blogger on the site during the World Economic Forum in January of 2008. Ah, we knew him when...

Another Sign that India's IT Industry has Come of Age

Steve Hamm — Thu, 25 Jun 2009 10:18:14 -0500

Here’s a telling tidbit from Lanny Cohen, CEO, North American Technology Services for Capgemini, the fourth largest IT services company in the world with revenues of $12 billion. He told me that he attended SAP’s annual Sapphire user conference in Orlando in May. There’s a show floor where business partners of SAP market their products and services. When he was walking around the show floor and checking in at the various booths, it struck him that the experience at each of the IT outsourcers’ booths was essentially the same, no matter if it was IBM, Accenture, HP/EDS and Capgemini or Wipro, Infosys, and TCS. The branding, the array of service offerings, the quality of the people manning the booths; it was the same. Immediately afterwards he sent an e-mail memo to Capgemini’s executives in the US and at the headquarters in Paris describing his impressions. The message was, essentially: The Indians have arrived at parity. “I said, ‘Don’t underestimate these guys. They’re not just in the back office anymore. In the midst of this down, they’re becoming like mature Western-style players--the messaging, content, and style. They’re just like the other global players.’”

Ingres: An Open Source Rival to Oracle

Steve Hamm — Wed, 24 Jun 2009 10:18:30 -0500

I've been following the path of Ingres Corp. ever since Terry Garnett and David Helfrich of Garnett & Helfrich Capital bought it from CA a few years back and made it into an independent company once again. Ingres and MySQL are the main open-source alternatives to Oracle in the database software market. Now that Oracle is buying Sun Microsystems, which owns MySQL, you've got to figure that Oracle will starve MySQL once it owns it--eliminating what had until now been a potent rival in the Web site market. Ingres is emerging as the last bastion of opposition within the open source world.

The Newly-Minted CEO: Symantec's Enrique Salem

Steve Hamm — Tue, 23 Jun 2009 14:41:29 -0500

Life is different when you're the CEO. Enrique Salem, who became CEO at security software giant Symantec just 11 weeks ago found that out. (Previously he was COO) He immediately felt the weight of responsibility for running a large public corporation. He noticed that the people who report to him became very careful with his time. They won't come to him now unless they can't resolve a problem or resolve an issue without his input. What he enjoys best about being the boss is all of the interesting people it puts him in direct contact with. In the past few weeks, he has met with President Obama, Desmond Tutu, Jim Collins, Nancy Pelosi, Larry Summers, Michael Dell, King Abdullah of Jordan, and George Tenet, to name a few.

Lenovo Looks for a Laptop Sweet Spot

Steve Hamm — Tue, 23 Jun 2009 08:59:06 -0500

I spent more than a year tracking Lenovo's designers and engineers as they developed the innovative X300 laptop computer, which was released in March of 2008. This work produced a cover story for BusinessWeek and my book, The Race for Perfect. The X300 was lusted after by corporate laptop aficionados--especially the X301 version, which came out last August and had a more powerful microprocessor. The X300 was a beauty. Very thin. Very light. Solid state storage, so it was durable. But, at about $2,700 initially, the price was too high for this to be a mainstream laptop. Sales of the X300 met Lenovo's objectives, but the goals weren't set that high. Now Lenovo is trying to marry two laptop concepts to come up with a new one that might be appealing to corporations on a grand scale.

I got the briefing last week on the T400s. I don't intend to go all gear-head on you (not my style, generally). This posting is about innovating around market segments and finding sweet spots.

New Web Site for Volunteerism

Steve Hamm — Wed, 17 Jun 2009 15:23:29 -0500

Sometimes the most powerful tools are the simplest, and that may turn out to be true for a new Web site that links people up with volunteer opportunities near where they live or work. All for Good eliminates some of the excuses people come up with for not volunteering. On the welcome page, you type in your location in a search bar and immediately get a list of volunteer opportunities in your vicinity. Search again by the type of thing you're interested and your choices are narrowed. You can select by time-frame as well. A map on the left of the page pinpoints locations. You can easily link your activities on the site to your Facebook account and other social networking hot spots. There's a Digg-like approval feature, and a page for keeping track of your interests.

Even though the Web site is still in alpha mode, it's already serving an important purpose--as the back end for the United We Serve public service initiative launched today by President Obama.

One last good thing: It's built with open-source software.

Gates Foundation's John Deasy on Education for Competitiveness

Steve Hamm — Tue, 16 Jun 2009 15:45:03 -0500

At the Aspen Global Leadership Network gathering I had to dig around to find an appropriate person to answer one of the questions that came from a GlobeSpotting reader. The topic was the role of education in national competitiveness. The answer came from John Deasy, Deputy Director of Education at the Bill & Melinda Gates Foundation.

John Wood Calls on Billionaires to Give More

Steve Hamm — Mon, 15 Jun 2009 15:18:49 -0500

Times are tough for everybody--even billionaires. But John Wood, chairman of Room to Read, an organization that builds schools and libraries in developing nations, is calling on the world's wealthy people to give more money for worthy causes. Room to Read has a $23 million budget this year, which is allowing it to expand in the nine countries where it operates, but Wood, a former Microsoft executive, says the generosity of Bill Gates and Warren Buffett should be matched by others of the wealthy class. "The world's billionaires need to do more. They need to pick an issue and go out and do something about it." It's no surprise that charitable giving is down. It amazes me, though, that I'm hearing from some social enterprises and NGOs that donors are backing off on pledges. Seems cruel at a time when poor people are getting whacked by this economic mess harder than everybody else. So, billionaires of the world: unite around philanthropy. Now is when we find out who's really dedicated to make a difference and who gives mainly to buff up their image.

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Your Aspen Institute Questions Answered

Steve Hamm — Mon, 15 Jun 2009 13:47:52 -0500

A bunch of people sent in questions for me to ask of high-profile attendees of the Aspen Global Leadership Network conference in Aspen late last week. Unfortunately, Sonal Shah, the White House director of Social Innovation, couldn't get permission to speak publicly about her programs--some of which are due to be announced in the coming weeks. Also, I couldn't ask a question of David Rubenstein, head of The Carlyle Group. But I did get answers from John Wood of Room to Read and John Deasy of the Gates Foundation.