The Semantic Web (podcast)

February 15, 2008

In the future, it may be a whole lot easier to find information we need, either on the Web or within a company. Within corporations, Semantic Web technologies make it possible to tag data and using Web-based software find and correlate information that may be scattered across a company in disparate databases and software programs. Experts say these technologies will give executives better information and ultimately help them make better decisions

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Waqas Ahmed
TeeThree Corporation

Source: BusinessWeek

Outsourcing’s Advantages

October 9, 2007

Outsourcing offers businesses the opportunity to cut costs and boost productivity — if it’s done right.

Offshore locations feature low-cost workers who can cut your labor costs by 50% or more. Tapping workers in India or China also affords the possibility of round-the-clock technical or customer support — when domestic staffers sign off in the evening, their Asian counterparts are just waking up. Companies can also transform labor costs from fixed to variable by working with an outsourcer. Need extra manpower during the holidays? A service provider can put more bodies on your account during crunch times. Finally, outsourcers can provide quick access to domain and technology experts who may be in short supply locally.

Despite these advantages, reports abound about outsourcing gone bad. Dell infamously had to repatriate some customer service operations after customers complained they couldn’t understand foreign phone reps. The bottom line: Outsourcing isn’t about blindly throwing work over the wall; it needs to be thought out and aggressively managed. Here are some pitfalls to watch for, and how to cope.

Many outsourcing projects fail because of lack of internal oversight. Forrester analyst Christine Ferussi Ross says businesses should establish formal vendor management offices staffed with professionals experienced in IT operations, contract negotiations, and procurement. Also needed is an individual with the diplomatic skills necessary to maintain vendor relationships over time. “Outsourcing implies some give and take,” says Ross.

Only 47% of 615 companies recently surveyed by Forrester reported having a centralized vendor management office.

Costs also need to be managed, or potential savings can evaporate quickly. Of concern lately for those outsourcing to India is the rising rupee, which has gained about 14% against the U.S. dollar over the past year. Businesses need to negotiate up front the extent to which their vendor is willing to insulate them from currency fluctuations. Labor costs in India are also rising — by as much as 15% per year — so companies interested in outsourcing for the first time might do well to scout out locations that haven’t been oversold, such as South America and China, and even second-tier cities in India. Not everything needs to be in Bangalore.

Deciding what to outsource is almost as critical as the decision to outsource itself. Not all IT projects or customer groups are created equally. Outsourcing the development of non-critical applications or customer service for low-revenue customers are good places to start. Dell’s mistake was offshoring service and support for its high-end business customers.

Regardless of what you outsource, the security of your company’s and your customers’ personal and business data must be a top consideration. When weighing vendors, it’s worth a trip to their facilities to inspect first-hand their security technologies and policies, even if that means a long flight. Most major offshore outsourcers, including India’s big four of Wipro, TCS, Infosys, and Satyam, have sophisticated security processes in place. Even so, it must be negotiated up front who is responsible for what if a breach occurs.

Outsourcing needn’t be fraught with peril, but it does need to be well managed.

Waqas Ahmed

Global IT Spending To Reach $1.48 Trillion In 2010

October 9, 2007

Global IT spending is projected to increase at a compound annual growth rate of 6.3% to reach $1.48 trillion in 2010.

Broken down by segment, worldwide
software spending is expected to reach $327 billion in three years, reflecting a compound annual growth rate of 7.7%. The hardware market is projected to reach $562 billion by 2010, driven mainly by “robust” spending from the home business and consumer, communications, and government sectors. Specifically, more money spent on volume servers, peripherals, storage, and networking equipment worldwide.

Companies also are expected to increase spending on IT services at a compound annual growth rate of 5.8% to reach $587 billion at the end of the decade. Sectors expected to have the highest demand are government, banking, and discrete manufacturing.

The spending projections are contained in a study called Worldwide IT Spending, 2006-2010 Forecast Update by Vertical Market: North America, West Europe, Asia Pacific, and Rest of the World.

Waqas Ahmed

Here’s What Microsoft Could Do With Facebook

October 9, 2007

Microsoft‘s reportedly in talks to invest somewhere between $300 and $500 million for a stake in Facebook. Here’s what Microsoft could do with it.

  • Create Microsoft applications to run on Facebook’s F8 platform. Live Messenger for Facebook? Live Calendar for Facebook? The possibilities are endless, and Facebook apps for the most part are relatively simple. Microsoft’s Popfly mash-up tool already works with Facebook and Microsoft has a Facebook Developer Toolkit for Visual Studio.
  • Create interoperable ties between Facebook and Windows Live Spaces or even SharePoint. Open social networks may be the future, and Microsoft doesn’t seem to be getting much if any traction with Windows Live Spaces just yet. Why not give it a boost by opening Live Spaces users up to a huge group of people with whom to connect?
  • Secure Facebook as an advertising customer. Forever. Microsoft already has a deal to syndicate ads at Facebook through 2009. Turning Facebook into Facebo-soft should get the company some additional advertising perks, like locking in Facebook’s millions of users as advertising customers in perpetuity.
  • Keep a close eye on a potentially scrappy competitor. Facebook certainly is trendy these days, and Microsoft would clearly like a piece of that, whether the investment potential is real or not. I’m not saying Facebook is anything more than a competitive rounding error to Microsoft right now, but by moving some Redmond spies down to Facebook’s Palo Alto office, Microsoft will be better able to understand and dissect the Facebook phenomenon and stalk talent.
  • Sit on it and block other competitors. Yahoo offered Facebook $1 billion a while ago, and Google also is rumored to be a suitor. These are Microsoft’s real online competitors, and a Facebook investment could be a preemptive move by Microsoft just to keep its competitors grimy little hands off.

Anything else?

Waqas Ahmed

Microsoft’s Explorer Update Ditches Windows Genuine Advantage

October 9, 2007

Microsoft has released an updated version of Internet Explorer 7 that dispenses with a cumbersome security feature designed to ensure users are running the Web browser atop legitimate copies of the Windows operating system.

In a note posted Thursday on the Explorer development team blog, Microsoft programmers said the decision to drop Windows Genuine Advantage, as the security feature is known, from Explorer was made to promote the browser to a wider audience.

“We’re updating the IE 7 installation experience to make it available as broadly as possible to all Windows users,” said Explorer program manager Steve Reynolds in a
blog post.

Flaws in Windows Genuine Advantage have reportedly resulted in millions of Windows users erroneously being reported to Microsoft as software pirates. A Chinese student has gone so far as to
sue Microsoft over the issue.

The update, available as a download, also includes a number of other enhancements to Internet Explorer 7. The menu bar is now visible by default, the online help section has been enhanced, and a new tool is included to help IT administrators in large enterprises deploy the browser.

Microsoft is clearly hoping the update will boost adoption of IE 7, which debuted last year for Windows XP and was updated in January for Windows Vista. Despite the releases, Explorer’s market share has declined slightly over the past year as competition emerges from Firefox, Safari, Opera, and other alternative browsers.

Explorer’s market share fell from 81.3% of the market in October 2006 to 77.9% in September 2007, according to market watchers at Net Applications.

Waqas Ahmed

Microsoft Wants Red Hat Users To Pay

October 9, 2007

Microsoft CEO Steve Ballmer said his company expects payment from computer users who run Red Hat Linux because the open source operating system violates Microsoft’s intellectual property rights.

“People use Red Hat, at least with respect to our intellectual property, in a sense have an obligation to eventually compensate us,” Ballmer said at a company event last week in London.

A video of Ballmer’s speech appeared this week on a Microsoft U.K. Web site.

Microsoft has long claimed that Linux and other open source software programs violate its patents. Last year, the company
struck a deal with Linux distributor Novell under which it indemnified Novell Linux users from any legal claims. In return, Microsoft gained the right to re-sell certificates for Novell’s SUSE Linux at a mark-up.

Last week, Ballmer implied that users of Linux distributions from vendors other than those with which it has patent deals — the list also includes Xandros and Linspire — could be hearing from Microsoft. “We’ve spent a lot of money licensing patents,” Ballmer said.

Ballmer said Microsoft would like to create “an intellectual property framework” that bridges the commercial software and open source worlds so that users know where they stand with regards to using certain software programs.

He may not get much cooperation from the open source community, however. Linux advocates insist that the open source OS does not step on Microsoft’s intellectual property and have publicly challenged the company to specify exactly which patents it believes have been violated.

Microsoft has thus far declined to do so.

Waqas Ahmed

Google And IBM Partner To Push Cloud Computing

October 9, 2007

Google and IBM on Monday announced an initiative to advance large-scale distributed computing by providing hardware, software, and services to universities.

The two companies aim to reduce the cost of distributed computing research, thereby enabling academic institutions and their students to more easily contribute to this emerging computing paradigm.

“Google is excited to partner with IBM to provide resources which will better equip students and researchers to address today’s developing computational challenges,” said Eric Schmidt, CEO of Google, in a statement. “In order to most effectively serve the long-term interests of our users, it is imperative that students are adequately equipped to harness the potential of modern computing systems and for researchers to be able to innovate ways to address emerging problems.”

The first university to join the initiative is the University of Washington, located not far from Microsoft‘s corporate headquarters in Redmond, Wash. Carnegie-Mellon University, MIT, Stanford University, the University of California at Berkeley, and the University of Maryland are also participating in the program.

“The reason that we’re partnering with universities is that Google is an engineering firm,” said Christophe Bisciglia, a senior engineer at Google and a former University of Washington student. “We’re working with our academic partners to teach [large-scale distributed computing] to students.”

The fundamental architecture of computing is changing, Bisciglia said. Moore’s Law still applies, he said, but now more performance gains come from processor density than transistor density. “You need to design your software to that it scales horizontally,” he said, referring to the challenges of programming for many multicore processors working in parallel.

“In this age of ‘Internet-scale’ computing, the new, evolving problems faced by computer science students and researchers require a new, evolving set of skills,” Bisciglia explained in a
post to Google’s corporate blog on Monday. “It’s no longer enough to program one machine well; to tackle tomorrow’s challenges, students need to be able to program thousands of machines to manage massive amounts of data in the blink of an eye.”

“This is really going to benefit every entity that goes on to take these students,” said Bisciglia. “They’re all going to benefit from this change. They’re all going to need it sooner or later.”

Large-scale distributed computing, also known as cloud computing, has been touted as the future for years now. In a July 2003 paper, Microsoft researcher Jim Gray — who was reported missing at sea earlier this year — noted that IBM and Microsoft were pushing Internet-scale distributed computing as a new model.

Sun Microsystems has also long been an advocate of what it calls grid computing.

In a statement, Samuel J. Palmisano, chairman, president, and CEO of IBM, characterized the effort “to train tomorrow’s programmers to write software that can support a tidal wave of global Web growth and trillions of secure transactions every day.”

Whether IBM and Sun will develop an ad-based revenue stream to support large-scale distributed computing remains to be seen. Unlike Microsoft, neither company has hedged its business model by investing in Internet advertising technology.

As part of the initiative, Google and IBM are providing a cluster of several hundred computers — Google’s custom servers and IBM BladeCenter and System x servers. Over time, the companies expect the cluster to surpass 1,600 processors. The Linux-based servers will run open source software including Xen’s virtualization system and Hadoop, an open source implementation of Google’s distributed file system that’s managed by the Apache Software Foundation.

Although Hadoop was developed by Yahoo
‘s Doug Cutting and can be seen as enabling Google’s competitors, Google says it supports the effort. “We’re made very small contributions to Hadoop for this project and we obviously very strongly support the project,” said Bisciglia.

IBM’s Tivoli software will handle cluster management, monitoring, and resource provisioning.
Students working with the cluster will have access to a
Creative Commons-licensed curriculum for massively parallel computing developed by Google and the University of Washington.

Waqas Ahmed

Pakistan: Better Late Than Never In Outsourcing

September 9, 2007

Think software and services outsourcing, and places like Bangalore, Manila, and perhaps Budapest spring to mind. But Lahore or Karachi? The Pakistani cities might not be on the outsourcing map yet, but the country’s software shops are out to change that. “As a natural course, American companies would not look at Pakistan,” acknowledges Jehan Ara, president of the 250-member Pakistan Software Houses Assn. “So we have to get them to look at us, and once they do business with us and credibility is established, they come back for more.”

It makes sense for Pakistan to follow in India’s footsteps and try to boost its outsourcing business. The country, after all, shares India’s British colonial history and has some 17 million English speakers. It has a huge community of émigrés with experience in technology. And like India, it has a culture that values education and hard work. Wages, meanwhile, stand at about the same level as in India, with call center workers earning about $12 per day and starting software engineers pulling in $5,000 or so annually.

Still, Pakistan remains far behind India. Last year the country’s software and IT services business hit just $300 million, and exports made up only about 11% of that. India, by contrast, booked $12.8 billion in software and services exports in 2004. But the Pakistan Software Export Board, a federal body set up to promote outsourcing, forecasts that the business will grow by at least 45% annually in coming years. “Pakistan started late but now is catching up very fast in software development,” says Prime Minister Shaukat Aziz.

Lower-level operations such as call centers are expected to grow even faster: Some 120 centers have opened in Pakistan in the past two years. Today they employ 3,500 people, and that number is expected to grow by 60% a year. Arwen Tech, a Karachi company that runs a 600-seat center, saw its sales double last year, to $10 million, serving clients such as Pakistan International Airlines and the local franchisee for KFC Corp. Now the company is building a 1,500-seat facility and hopes to boost revenues tenfold, to $100 million, in the next five years as it attracts more international clients.

Pakistan could use the boost that outsourcing provides. Unemployment is officially pegged at 8%, although in reality it’s far higher than that, and the government is looking for ways to fuel economic growth. Pakistan needs technology to increase efficiency and productivity. And software exports will help the country move away from its reliance on textiles, which make up 65% of total exports.


Still, Pakistan faces major hurdles. First, there’s the question of security: Few Western execs are willing to entrust sensitive data to such a troubled country. And despite its 55 tech institutes, Pakistan may face a shortage of IT workers. About 75,000 people work in the sector today, and the government believes a further 7,000 will be needed each year to keep the industry growing at current rates. But the country’s tech schools produce just 5,500 graduates a year — and only about a fifth of those are competitive and well trained, the Software Export Board says.

The country is working to fix those problems. A new government commission aims to beef up education standards. Since 2001, Parliament has scrapped corporate taxes on software exports and simplified the investment process. In the next three years, the government also plans to open IT parks in Islamabad, Karachi, and Lahore. And the Pakistan Software Houses Assn. last year sent two delegations to India, then in February invited a group from Bangalore to Karachi and Lahore in an effort to learn from the Indian experience.

Outsourcing companies have developed their own strategies for beefing up their business. One is to look for customers in places other than the U.S., where Pakistan’s image problems are most acute. In 1996, Lahore’s NetSol Technologies Inc. won a contract from Mercedes-Benz Leasing Co. in Thailand to install a software program from Britain. Later the company developed its own package, which it went on to sell to DaimlerChrysler in nine Asian countries. The NASDAQ-listed company now has 270 employees and this year expects sales of $10 million. In April NetSol signed a $2.3 million deal with Toyota Motor Corp. and hopes to expand into Europe.

Karachi IT services firm System Innovations looked for work even closer to home. The company was conceived five years ago by Amer Hashmi, a six-year veteran of IBM’s Global Services division in Toronto. The 34-year-old Hashmi saw an opportunity supplying software to state-owned Pakistani companies, and today counts the electric monopoly, Citibank’s Pakistan operations, and Habib Bank Ltd. — the country’s second-largest — among his 50 clients. Now, with 100 employees and $10 million in sales this year, Hashmi hopes to triple the company’s size in the next 12 months by boosting sales to U.S. corporations. He plans to open offices in Texas and Ontario this summer.

Others have set up front offices in the U.S. to win customers. Lahore’s Techlogix Pakistan, one of the country’s first software exporters, gets 95% of its business from the U.S. Most of that comes in from a four-member sales team in Boston, which funnels work to 90 software developers in Pakistan and a further 35 in Beijing. The company booked $8.2 million in revenues in 2004 serving 18 clients, including General Electric Co. and Massachusetts Mutual Life Insurance Co. “Our U.S. office has to offer the same kind of relationship-management as top-notch U.S. companies,” says Kewan Khawaja, co-CEO of Techlogix. It may be a while before Karachi or Lahore has the resonance of Bangalore or even Budapest. But plenty of ambitious Pakistanis are working to make it happen someday.

Waqas Ahmed

The Right Way to Use Web 2.0

August 28, 2007

Entrepreneurs are eager to use the rapidly emerging social networks and blogging tools to get closer to their customers, but first they need to develop a business strategy, according to members of a high-profile panel in a recent discussion at the MIT Enterprise Forum of the Northwest. Panelists included representatives of Technorati, Facebook, and Wetpaint, who offered the following suggestions for best using Web 2.0 techniques:

• Define the business goals your business can achieve by creating a community. One panelist described how Victoria’s Secret created a Facebook community around “Pink,” a line of sweat suits, before the line was even launched. The company successfully used “a two-way dialogue” to build up advance sales for the new product.

• Don’t automatically give up on old marketing techniques in favor of Web 2.0. One panelist asked the audience how many have bought products based on TV advertising vs. Web advertising, and the TV side won out by a large margin. “People are sometimes too willing to abandon” tried-and-true marketing tools, noted a panelist.

• Go beyond starting a conversation with customers. While getting people talking is a good start, “You have to listen to people when they come” to a blog, noted a panelist. Because people tend to trust their own personal social networks more than any particular company, entrepreneurs must demonstrate their organizations are worthy of trust by applying feedback to their offerings.

Opinions Divided on Linkedin for Entreprenuers

The networking site gets mixed reviews in a discussion on the Harvard Startups listserv.
One entrepreneur reports he is down on LinkedIn because “it depends on all its members responding to messages when one member wants to contact another beyond their immediate network.… In every case where I tried to contact someone two networks away, I found the gatekeepers asleep, so my messages were never passed along.”

Another says he finds it “to be very static. The network’s in place, but I’m not doing anything with it, partly because I’m not sure how to use it well.… I like having other people I respect in mine in the hopes that they will ‘meet’ each other, but that doesn’t seem to be happening either.”

Others say they’ve had the opposite experience. “As your network grows, the number of gatekeepers available to a given contact grows as well. Perhaps I have just been lucky, but the ones I asked to pass on a referral have been prompt and helpful.” The head of a startup says he uses LinkedIn “almost daily. Anything from finding valuable information about a prospect…to finding the next employee, finding contacts in a particular industry, geography, and much more.”

Must Social-Entrepreneurship Ventures Be Nonprofit?

Not necessarily, argue two Spanish researchers in a paper published in the Journal of World Business. Analysis of three success stories—a bank in Bangladesh, a hospital in India, and an educational organization in Egypt—”reveals a common feature: All three creatively combine resources…to address a social problem and thereby alter existing social structures,” write Johanna Mair and Ignasi Marti of IESE Business School at the University of Navarra. The Bangladesh and Egyptian organizations “fit perfectly with a for-profit scheme,” they maintain. “In sum, whether social entrepreneurs choose a nonprofit or a for-profit vehicle often depends on the particular business model and the specific social needs addressed.”

More Early-Stage Businesses Leverage Emerging Economies

Consulting firm saw the percentage of inquiries for global businesses increase to 22% of the total, from 5% in the year-earlier period, according to the firm’s chief executive officer, Bryan Howe. Examples include not just outsourcing computer programming to India and targeting suppliers in Mexico, but developing condominiums in Montenegro for wealthy Russians and selling agricultural technology to Tanzania.

Waqas Ahmed

Outsourcing With Confidence

August 28, 2007

Call it the low-cost labor chase. Fed up with Bangalore’s swiftly rising costs, high turnover, and overstretched infrastructure, companies are looking to send IT operations to other cities. Need some inexpensive tech support? Check out Ho Chi Minh City. Want to develop a security system? Take a look at Bucharest.

But be warned. The labor may be cheap, but the risks can be high. Companies that shift work to developing countries have to be prepared to deal with language and cultural differences, potential political instability, and possibly even the theft of valuable intellectual property. Here’s a guide for going global.


Take a trip Before you sign a contract, spend some time at the offshore outsourcing center, even if it’s on the other side of the world. Many companies send business to centers overseas without ever visiting them.Consider culture Offshore workers may speak your language, but they may not fit the company culture. Want programmers to challenge ideas and propose alternate courses of action at times? You may be better off in Moscow than Bangalore.

Look beyond the bottom line Many outsourcing deals are focused solely on cost but break down in the third year after every last penny has been squeezed out. Instead, consider what you’ll need over a three- to five-year period and choose a vendor capable of innovating or making enhancements when the time comes.

Seek maturity The Software Engineering Institute rates the maturity of business processes of some offshore IT providers. Look for providers with CMMI (capability maturity model integration) Level 5, the highest possible rating.


Forget about time If your employees will need to collaborate with workers in other countries, pick an offshore destination in a time zone that will allow some overlap of the workday.

Give it all away Not all work is appropriate to send offshore. For instance, some organizations that outsource entire help desks are starting to take back pieces that are especially complex.

Expect instant results There’s an illusion that sending IT work offshore will immediately yield high productivity. Success takes time.

Pick the wrong partner Offshore providers often cater to specific countries. In China, for example, some providers have experience serving domestic clients, while others work primarily with U.S. and European companies.

Jump the gun If you’re just beginning to send work offshore, consider a locale where providers have years of experience. Emerging destinations such as China or Vietnam offer lower costs but present bigger challenges.

Waqas Ahmed