Bharti at last gains a foothold in Africa

Bharti Airtel is one of the fast-growing mobile players in India, and it has been looking to expand overseas for some time. It identified Africa as a target, and last year it tried (and failed) to merge with MTN of South Africa. This would have created the second largest mobile player in the world. But Bharti is nothing if not persistent.On Tuesday this week Bharti confirmed that it had acquired the African assets of Zain the Kuwaiti mobile company. As a result Bharti becomes the fifth largest mobile operator in the world.

 

So what? This deal means that Bharti is now a partcipant in what we have described as "the new scramble for Africa" alongside France Telecom, Vodafone and Etisalat. Because Africa is one of the last continent to embrace mobile communications, the potential benefit for Bharti and others is that those mobile operators who get in early can get carried along by the rapid growth phase and can build substantial businesses quickly. So this deal catapults Bharti into the mobile premier league.

 

But what is even more interesting is that Bharti is not just another mobile player -it has a unique business model as outlined in our report New Business Models Emerge For Telcos. Bharti describes itself as a services business, so it concentrates on providing service to customers and outsources all it's IT (to IBM) and networks (to Nokia and Ericsson) in return for a slice of the call revenues. So Bharti does not own its networks and IT stacks. It's reasonable to assume that it will replicate this approach in Africa, and, if it is successful, this will put pressure on the other mobile players to consider copying their unique business model.

 

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Oracle’s Attack On The Mainframe Vendor(s)

Oracle has just made two major announcements around Tuxedo and Mainframe Migrations

 

Tuxedo is Oracle’s application environment for the non-Java languages. Like most “legacy” transaction servers, Tuxedo provides major large enterprise functionality to the programming languages prior to Java. Tuxedo had focused on C/C++ and COBOL until now. Among a couple of innovations, the most exciting news in the just-announced Oracle Tuxedo 11g release is the support for Ruby and Python. This pushes these newer languages immediately up the enterprise performance and reliability scale, making them comparable to COBOL, ABAP, and NATURAL.

 

The huge challenge for Oracle after this move will be to get access to the Ruby and Python developer communities. Most of them are looking more at open source runtime environments than at heavyweight enterprise transaction environments. However, this latest move by Oracle may resonate with these young open source natives, who’ve gone from university to their first job at banks, insurance companies, and other traditional mainframe shops. Ruby and Python on Tuxedo could be appropriate choices for those developers who want to move stuff off a mainframe but don’t want to get into COBOL on the new platform again.

 

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M2M - back again but it's different this time.

Machine-to-machine (M2M) communications is back - judging by the number of press announcements released by various players. The Vodafone/Verizon Wireless/nPhase announcement at Mobile World Congress in Barcelona illustrates the point. Forrester is on to the M2M case too. Earlier this month my colleague Michele Pelino published a paper titled The M2M Market Is A Blossoming Opportunity. We have also published a case study on the topic too - see the Forrester paper titled Case Study:How Orange Business Services Is Building a Machine-To-Machine Market. The two reports were planned to complement each other, explaining the big picture and giving a practical illustration of how Orange Business Services is addressing the M2M opportunity.

 

Of course, those of you with long memories will recall that we have been here before. In our view M2M initially failed to take off because the ecosystem was not in place to enable solutions to be put together easily. But this time it is different - AT&T, Telenor, and Telefonica are all active in the M2M market in addition to Vodafone and Orange Business Services. But what about you - what do you think. I'd be happy to hear your take and discuss further.

Tata and Huawei: New-style competitors and change agents in the ICT ecosystem

I recently attended the Tata Communications Analyst event in central London, and fascinating it was too. Tata Communications is a domestic Indian, South African and International communications service provider comprising the former businesses known as VSNL, Teleglobe, Tyco, Neotel and DishnetDSL. All were acquired in the past few years. Tata Communications is part of the Tata IT and Communications division (ITC) that also includes Tata Consultancy Services (TCS - the systems integration, applications, and outsourcing business) which in turn is part of the Tata Group conglomerate.

 

So what? What makes Tata Communications interesting is they are part of the ITC division alongside TCS. If anything symbolizes the fusing of IT and communications into ICT (Information and Communications Technology) over the past decade in one business then this is it. This is important because the traditional telecoms cascade supply-chain is being replaced by an integrated ecosystem (see Forrester research Farewell to the Traditional Telecom Ecosystem). As a consequence Tata can play multiple roles (rather than predominantly one as is the case for many of their rivals) and so is a new type of player. 

 

But Tata are not alone. Late last year I spent some time with Huawei - the Chinese Network Equipment Provider (NEP)- at their EMEA H.Q. in Germany. Apart from posting spectacular revenue growth figures (in contrast to their established western-based NEP rivals) it is also busy creating a systems integration business too. They have seen the parallel growth of the IT Services sector and have decided they want a slice of this pie too. With the resources and determination they have it would take a brave person to bet against them succeeding.

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An abstraction layer for IT operations

Technology growth is exponential. We all know about Moore’s Law by which the density of transistors on a chip doubles every two years; but there is also Watts Humphrey’s comment that the size of software doubles every two years, Nielsen’s Law by which Internet bandwidth available to users doubles every two years, and many others concerning storage, computing speed, and power consumption in a data center. IT organizations and especially IT operations must cope with this afflux of technology, which brings more and more services to the business, as well as the management of the legacy services and technology. I believe that the two most important roadblocks that prevent IT from optimizing its costs are in fact diversity and complexity. Cloud computing, whether SaaS or IaaS, is going to add diversity and complexity, as is virtualization in its current form. This is illustrated by the following chart, which compiles answers to the question: “Approximately how many physical servers with the following processor types does your firm operate that you know about?”

Physical Server Installed

If virtualization could potentially address the number of servers in each category, it does not address the diversity of servers, nor does it address the complexity of services running on these diverse technologies.

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Privacy, regulation, and reputation

I wrote previously about Google's challenges with respect to privacy, and since then it has incurred the wrath of consumers with its initial rollout of Buzz. And my colleague Chenxi Wang blogged about Facebook's issues with its privacy policy.

What's intrigued me about these two incidents is that the companies each ended up making serious missteps by publicizing information that at first blush seems innocuous. Google exposed information about who you email with; Facebook made public your circle of Friends.

Nor does this type of data fall into the category of PII (personal identifiable data). So despite the ever-growing regulatory climate on privacy (HITECH, Massachusetts 201 CMR 17.00, PCI, etc.), the nature of consumer concerns far outpaces any legislative efforts.

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SAP 3rd Party Maintenance: An alternative for me? - Part Two

Hi, I'd like to share part two of a recent discussion that I had with Martin Schindler, Editor of Silicon.de. See part one here in case you missed it.

Martin Schindler: You indicated earlier that interest in third-party maintenance has increased since SAP wanted to make its Enterprise Support basically mandatory. Is this just excitement or real demand?

Stefan Ried: Yes, interest has increased. We're also seeing that from the vendor side. In addition to Rimini Street, which already offers maintenance for SAP systems, there is also Aptech, netCustomer, the Spinnaker Management Group, and Versytec, which are today limited to PeopleSoft, JD Edwards, and Siebel. The vendor space has developed further, and the list of SAP-supporting vendors will soon become longer. Finally, it makes sense to ask the larger systems integrators, such as Wipro, Tata Consultancy Services, IBM Global Services, and Siemens (SIS), which are also the largest SAP integrators, to quote for offering SAP third-party maintenance.

Martin Schindler: This is interesting. We've read little about such offers.

Stefan Ried: These integrators naturally don't make a lot of noise about these things, as they also have a partner relationship with SAP, of course. At the end of the day, the demand will be balanced with the supply — and if more customers request SAP maintenance from their systems integrator, they will start to offer it.

Martin Schindler: Is this profitable for integrators?

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Really end to end management: Gomez and Compuware

The marriage of Gomez and Compuware is starting to bear fruits. One of the key aspects of web application performance management is end user experience. This is approached largely from the data center standpoint, within the firewall. But the best solution to understand the real customer experience is to have an agent sitting on the customer side of the application, without the firewall, a possibility that is clearly out of bounds for most public facing applications. The Gomez-Compuware alliance is the first time that these two sides are brought together within the same management application, Compuware Vantage. What Vantage brings to the equation is the Application Performance Management (APM) view of IT Operations: response time collected from the network and correlated with infrastructure and application monitoring in the data center. But, it’s not the customer view. What Gomez brings with its recent version, the “Gomez Winter 2010 Platform Release” is a number of features that let IT understand what goes beyond the firewall: not only how the application content was delivered, but how the additional content from external providers was delivered and what was the actual performance at the end user level: the outside-in view of the application is now combined with the inside-out view of IT Operations provided by Vantage APM. And this is now spreading outside the pure desktop/laptop user group to reach out the increasing mobile and smart phone crowd. IT used to be able to answer the question of “is it the application or the infrastructure?” with Vantage. IT can now answer a broader set of questions: “is it the application, the internet service provider, the web services providers?’ for an increasingly broader range of use-case scenarios.

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Vendors: Position Your Products To Address The Needs Of Mobile Information Workers

We have all heard a lot about the growing segment of information workers including senior executives, managers, legal professionals, and financial service executives who use their smartphones for work. About 45% of all employees in the US are information workers, and Forrester survey results show that nearly 15% of these workers use smartphones for work. In addition, nearly 33% of information workers are issued smartphones by their company, and about 25% select and purchase a smartphone that may, or may not be supported by the company. We expect the info worker segment to grow significantly as more employees work away from their desk or telecommute.

 

Vendor marketing and strategy professionals across the mobile value chain must understand how information workers use smartphones and applications, so they can successfully develop products to address the needs of these workers. Information workers are going beyond plain vanilla email, calendar and PIM applications. Many are trying out instant messaging, productivity apps to access Word, Excel, and PowerPoint documents, and location-based services. To tap the fast-growing slice of information workers relying on their smartphones, business application categories must be clearly identified on mobile operator portals and mobile app store sites. Device manufacturers and mobile operators must also ensure smartphone features and functionality address both personal and professional user needs. Are there other strategies vendors are using to address the needs of the mobile information worker segment?

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SAP 3rd Party Maintenance: An alternative for me?

I'd like to share a recent discussion that I had with Martin Schindler, Editor of Silicon.de

Martin Schindler: There are experts who talk of a non-existing market when it comes to SAP third party maintenance. Is that correct?

Stefan Ried: You could have the impression, especially for Germany, because companies remain very close to SAP and many have decided for a Single-Vendor-Strategy. But in other countries it is much less the case. However the price politics of SAP in the last year and now the slow innovation speed has raised the discussion of alternative maintenance model again.

Martin Schindler: Are there German users with real interest in obtaining maintenance for their SAP system through another company?

Stefan Ried: Yes, there is definitely interest.

We regularly make, and particularly in the last year, sample calculations for users (as well as for system integrators) if it is worth going for third-party maintenance. It depends on various factors, whether it is worth it.

Martin Schindler: What do these factors look like?

Stefan Ried: Companies must check, for example, how much "know-how" exists in-house. Third-party maintenance can work very well, if not everything from SAP-Maintenance is needed. This is for example the case, when parts of the SAP-System are regarded as frozen, small legal changes follow, or to repair a bug. With this technical problems, compatibility with operating system patches, performance problems within an established system can be addressed and the system can operate securely with very little change. So, third-party maintenance vendors can, especially for older SAP systems, work very well.

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