Monday, June 05, 2006
Same thing happened when we created the Java community. We spent a lot of money creating the Java Community Process and doing the church part as opposed to the state part. BEA, IBM, and a bunch of others went out and created Java app servers while we lagged in the market. The good news is that people didn't switch to .NET. They stayed in Java, and we were able to monetize other areas and come back later with our own app server, and we just reached 1.1 million subscribers to the Java Enterprise System based on our new app server and we priced it at model numbers that are way below because we had all of the community development to help us build that server.
Thirdly, we have now open sourced the implementation of the new UltraSPARC T1 Niagara microprocessor. How did we get this processor? We bought a little company called AFARA who was doing chip multithreading that used the SPARC architectures. It was binary compatible, it was a V9 architecture, we brought them in, we created an implementation that's blown away now, and now we are open sourcing the implementation and we've got dozens of universities moving their computer science departments to study the UltraSPARC microprocessor. We've got countries looking at standardizing on this microprocessor because it is open, zero barrier to entry, low-to-no barriers to exit. If you're sitting on a business model that is 40 percent after tax margins in software or silicon, this looks very scary.
We know how to make money and generate cash in this model because that is how this whole business model is geared up and we can get the best of the community, bring it on board, and staple it to our current price list with timely acquisitions. I don't think Sun could've survived our mistakes over the last 23 years without the community covering for us. Because when they leave and go to .NET, the barrier to exit is near-infinite, but when they stay within our SPARC/Solaris/Java community, we have a chance to come back later and make some money. So it is a very profitable thing and as I have committed over the last 23 years, until we get 10 times bigger than our nearest competitor, we will stay open. At that point, the economics of sharing suck.
Saturday, May 27, 2006
Here is the simple graph based on porter's competitive strategy. I am doing a research on various indian software service providers and their competitive strategy to win and execute software projects. I will be soon blogging my findings. Meanwhile, here is the saimple JPEG image that depicts porter's competitive strategy ( Created with free mind )
- The bargaining power of customers
* buyer concentration to firm concentration ratio
* bargaining leverage
* buyer volume
* buyer switching costs relative to firm switching costs
* buyer information availability
* ability to backward integrate
* availability of existing substitute products
* buyer price sensitivity
* price of total purchase
- The bargaining power of suppliers
* supplier switching costs relative to firm switching costs
* degree of differentiation of inputs
* presence of substitute inputs
* supplier concentration to firm concentration ratio
* threat of forward integration by suppliers relative to the threat of backward integration by firms
* cost of inputs relative to selling price of the product
* importance of volume to supplier
- The threat of new entrants
* the existence of barriers to entry
* economies of product differences
* brand equity
* switching costs
* capital requirements
* access to distribution
* absolute cost advantages
* learning curve advantages
* expected retaliation
* government policies
- The threat of substitute products
* buyer propensity to substitute
* relative price performance of substitutes
* buyer switching costs
* perceived level of product differentiation
- The intensity of competitive rivalry
* power of buyers
* power of suppliers
* threat of new entrants
* threat of substitute products
* number of competitors
* rate of industry growth
* industry overcapacity
* exit barriers
* diversity of competitors
* informational complexity and asymmetry
* brand equity
* fixed cost allocation per value added
Porter's Competitive Strategy
Saturday, February 11, 2006
Nobel prizes were created by the will of Alfred Nobel (Shown in picture, Inventor of Dynamite and founder of Bofors defence) a notable Swedish chemist.
A common legend states that Nobel decided against a prize in mathematics because a woman he proposed to (or his wife, or his mistress) rejected him or cheated on him with a famous mathematician, often claimed to be Gösta Mittag-Leffler (Swedish mathamatician) . There is no historical evidence to support the story, and Nobel was never married.
Another theory is, Nobel did not create a prize in mathematics simply because he was not particularly interested in mathematics or theoretical science. His will speaks of prizes for those ``inventions or discoveries'' of greatest practical benefit to mankind. (Probably as a result of this language, the physics prize has been awarded for experimental work much more often than for advances in theory.)
Why did he create Nobel prizes?
The erroneous publication in 1888 of a premature obituary of Nobel by a French newspaper, condemning his invention of dynamite, is said to have made him decide to leave a better legacy to the world after his death.
Sunday, February 05, 2006
There are no doubts at all in my mind also about the comparative advantages our MPs have over competitors from other countries.
To begin with the average Indian MP is not any other garden-variety, developing country parliamentarian – but one coming from the world’s largest democracy. That means there are more of them for overseas buyers to choose from. In fact they probably form the world’s largest pool of political manpower - which if exported out of India would help our country make great progress.
Secondly, they are thoroughly familiar with the institution of parliament- having tried to enter it for years through all means possible and once inside – fought tooth and nail to hang on. Our biggest global competitors – China and Pakistan - either don’t have parliaments at all or have pseudo-parliaments run by decree by the military. They just don’t stand a chance against our fellows.
Thirdly the Indian MP is available cheap by any international standards. (Man, are they a bargain or what!) I don’t really know the latest figures but a decade ago when Enron was buying up Indian politicians to back their scandalous power project the going rate was just a few thousand dollars each. In fact, you don't even have to pay them in dollars, Indian rupees will do. (But mind you - no soiled notes please - our MPs have their deep sense of national pride too.)
Fourthly, they are all willing to work on the night shift to take advantage of the time difference between India and developed countries in North America and Europe. Working in the night comes easily to our MPs, many of whom are from backgrounds where darkness was an essential precondition for carrying out their professional tasks.
(This is extact of article written by Mr. Satya Sagar, CPIL)
Privatise the Indian Parliament!
Earlier this yaer a television news channel exposed, using hidden cameras, how Indian MPs across several mainstream parties take money to raise questions in Parliament. While the event has evoked a predictable public chorus of ‘shame, shame’ and pious pronouncements on the decline in standards of our politicians all this in my opinion was missing the point completely. These allegedly ‘corrupt’ MPs need to be congratulated not condemned for their behaviour.
Before any of you go ballistic, let me explain why.
First of all, in a Parliament where a significant number of members have criminal records or are closely associated with crime, the act of a few MPs accepting money in a peaceful and non-violent manner is in fact a sign of hope.
It shows that despite the pollution of our national cultural values by foreign channels like Fashion TV even today Gandhi- (the Mahatma, not Sonia)- wields influence on at least some of our leaders. After all the same MPs could have been out somewhere extorting money at the point of a gun from someone. (Would that have been all right for the Aajtak TV fellows with their silly secret cameras? Hmmm!)
Secondly, by agreeing to raise questions in Parliament the honorable MPs demonstrated that there are still some elected representatives left in our country who are willing to work for their money. How many MPs do you know from whom a client, customer or citizen can get any work done or service performed even after paying hard cash?
And also think of it - how much easier it would have been for these MPs, being martyred by the media now, to have taken the money and then paid someone else to raise the questions. Wouldn’t that have been even worse, being outright cheating and complete dereliction of duty?
By taking up direct responsibility for asking the pre-paid questions (the post-paid option is still in the works) in Parliament, the MPs have in fact set a shining example of personalized customer service that puts much of the Indian private sector to shame.
But well beyond demonstrating the power of Gandhian thought and the ancient Indian work ethic what these eleven MPs have done is pioneered a concept that has deep implications for the future of electoral democracies all over the globe. They have taken the first steps towards implementing the amazing idea of Privatizing the Parliament!
Imagine the future! You want a question asked in Parliament-? No problem- you will be able to book your favorite MP over the Internet with the mere swipe of a credit card! (http://www.cashforquestions.com/ or something like that). There will be competition for this market of course so you can look forward to deep discounts from rival MPs who might offer two questions for the price of one. If you don’t have a second question to ask they will have management graduates who can invent them for you. How thoughtful!
Forget about mere questions- you want a law introduced or amended? No problem again-they will introduce, reduce, bend, amend any law you want and have it freely delivered to your doorstep!
If you privatize parliament then what is left of the idea of ‘one man, one vote’ and the very concept of electoral representative democracy? Does it not become ‘one dollar, two votes’ or whatever the conversion rate may be?
Indeed, if money can buy our MPs then why bother to have an elected government at all? Why not do an IPO and sell the damn institution to any multinational, hedge fund or global bank willing to pay the premiums? Why have a Prime Minister and a cabinet full of pompous ministers when you can get a smart, highly paid CEO and a board of directors accountable to none but their shareholders?
And will this mania for privatizing every public body stop with even the parliament or government? Why not privatize the armed forces and the police too- after all these are huge and highly subsidized institutions in every country that violate all the rules of the WTO? And while we are on this privatisation spree why not sell the moon also to a multinational - to convert moonlight into a moneymaking venture?
You know what? All these questions above are not really questions at all but frightening descriptions of where our dear country and the globe are really headed for. Even on a noisy day I can hear the future wheezing and sputtering with her privatized lungs.
(This is extact of article written by Mr. Satya Sagar, CPIL)
Monday, January 23, 2006
According to the legend of the Tower of Hanoi (originally the "Tower of Brahma" in a temple in the Indian city of Benares), the temple priests are to transfer a tower consisting of 64 fragile disks of gold from one part of the temple to another, one disk at a time. The disks are arranged in order, no two of them the same size, with the largest on the bottom and the smallest on top. Because of their fragility, a larger disk may never be placed on a smaller one, and there is only one intermediate location where disks can be temporarily placed. It is said that before the priests complete their task the temple will crumble into dust and the world will vanish in a clap of thunder. Interested in knowing the reason?The formula to find number of steps it takes to tranfer "n" disk is 2^n - 1
Even if it only takes the priests one second to make each move, it will be 2^64 - 1 seconds before the world will end. This is 590,000,000,000 years (that's 590 billion years) - far, far longer than some scientists estimate the solar system will last. That's a really long time!
Click here to see detalied explanation