Brij Singh's Random Musings

Keeping track of the numbers

Paul Krugman dissecting Bush's hired gun's projections
And employment is chasing a moving target: it must rise by about 140,000 a month just to keep up with a growing population. In April, the economy added 288,000 jobs. If you do the math, you discover that President Bush needs about four years of job growth at last month's rate to reach what his own economists consider full employment

AMR on IT jobs
Because of IT worker productivity gains and minimal IT spending increases, AMR Research estimates that U.S. IT head count requirements will grow at less than 1.5%, or roughly 700,000 workers, in the next five years. Since India's capacity will grow by 1.5 million IT workers, the net result is that not only will the demand created by the 700,000 new jobs be filled by India, but that 800,000 existing jobs will also migrate to India. The 30% to 50% cost savings offered by India is too great a benefit to ignore and will more than counteract the jingoistic attitudes that threaten to delay the transfer of work.

Business Week's review of Rational Exuberance
From 1993 to 2003, real wages for all workers, adjusted for inflation, rose by 9 percent, based on wage and price data from the Bureau of Labor Statistics. That's outstanding, especially when compared with a gain of only 1 percent from 1983 to 1993, the previous 10-year period.

State of EU

The EU boasts of 6 million jobs created since 1999 -- the bulk in services like health care and tourism -- but no one tallies how many jobs are being lost due to relocation of factories or outsourcing of business functions, such as call centers or bookkeeping .. France had lost 1.5 million jobs between 1978 and 2002, but the country’s industrial sector was still around 20 percent of the economy.

How much productivity is eating into the jobs and how much is going outsourcing way ?

Techno-nationalism

"Nationalism is the last refuge of the scoundrel. You wave the flag if you need financial assistance, because maybe you're not able to compete." That according to Duncan Clarke managing director of BDA China Ltd Consultancy. Apparently a consultancy firm whose clients are at the wrong end of this development.

China is charting a new path here. Just a quick scan of technologies which they are influencing will give an idea of how innovation and market moves can be manipulated by the power of market size. Want a new DVD standard - EVD, Want new CDMA - try TD-SCDMA, new wireless standard WAPI, separate Linux kernel - Red Dragon Linux and many more such go-native initiatives in the pipeline.

As technology is becoming integral to society and provides the biggest leverage in achieving market share superiority, using captive market size to drive and manipulate market will pose an unusual threat. What if every country (with sizeable internal market size - BRIC countries and other developed world) starts following this approach. Then very soon you will have (like domain names) country specific variant to every conceivable standard out there. If you want wireless standard then you will have choices - 802.11x.us, 802.11.x.Ch, 802.11.x.In etc.
And having more choices in standards can be really debilitating, according to the book which I just started reading. More on the book in later posts. It's a real eye openener.

Note: BCG in collaboration with Wharton is running a series on Chinese economy. Painting a dual picture of go-slow but can't ignore the long term growth prospects. Good high level overview.

Education sector reform - manifesto analysis

Satyanarayan has an excellent analysis of education sector reform promises made by different parties in their election manifestos. Congress proposal for setting up EDFC is compelling if executed along the lines of HDFC. It seems country is still running short of 1.7% of GDP to fulfill it's goal of 6% of GDP as an investment in education sector. This 1.7% amounts to a whopping sum of $11.05bn. This further proves that government need to focus more on the primary education rather than putting their precious resources in expensive higher education sector.

(This is the beauty of the blog medium that these party manifesto will be discussed/analyzed/measured and made accountable)

International Thing

Andrew Anker adds international expansion as a must have in the list of must-haves for early stage companies.
In a recent VC Breakfast meeting , I heard one general partner associated with a top tier firm telling rather emphatically to all the attendees - two things we prefer in a pre-fund stage software company - offshoring and subscription licensing model. Companies can safely add international marketing approach to that list as well. This probably explains this subtle( but definitely new) trend where some of the Indian-origin entrepreneurs are first testing their products in Asian market before bringing that in US. It's cheap and apparently it is working.

Learn to trust people

I see similarity in what Jarvis is referring to and what is happening in India, where so called intellectuals were taken by surprise with stunnning blow to their political predictions.

If you do not trust and respect the people, then you don't -- you can't -- believe in democracy... or capitalism... or education... or art... or reform theology... And if the people don't read what we write, then maybe we should find a new way to write it

It's absolutely fatal to democratic theory to believe the public is incompetent

One-Minute Movies Culture

Dancing Mouse, BBC is experimenting one minute movie fest. This is incredible interesting to study. For obvious reasons, what is one minute today will become 100 minutes for your kids or maybe break the average 120minutes time span.

Check this comment from the budding director - Andrew Paul

I have decided to pursue my hobby even more and turn it into a career. I do quite a few weddings etc. but am looking to get into filming and editing. I am 38 years of age with two young children and a very (financially) understanding wife. I am currently on offer to anybody who wants me in the film industry for either cash payment or a cup of tea.

There are thousands of amateur Andrews out there. This is a nascent market which will mature in next 5-10 years. Time to tinker with these tools is now. And by the way keep thinking how to monetize your content while avoiding San Fernando valley business model.

I will see what my biases allow me to see

CSM's news headline strengthening my belief that mainstream media is increasingly becoming dull, stereotyped to the extent that they are not worth your time. If only Google news can start providing user selection in their news page.

Who gives a hoot if he is Non-Hindu ? Actually I was hoping that this hack will also provide details on the number of elephants and bullcarts Manmohan Singh has back in his Ludhiana home and how their family still eat on the floor! Probably thats coming in the sequel.

One simple instruction for all the western journalists out here- shed your stereotypes. World is changing and in many parts of the world it has already changed.

Workshop goes to open source

Another Open source move, BEA decided to open source their Workshop application. This product was the result of an expensive acquisition. they made in 2001.

I am waiting for IBM to push Websphere into Open source and effectively causing a huge disruption in the open source application server and application toolset space.. With their push towards business processes and also letting business analysts drive the technology enhancements using Rational tool set. This move will make a good business sense as well. Their 40million investment in Eclipse project and billion dollar investment in Linux is paying off handsomely. DB2 is a cash cow and doesn't provide great revenue scale to IBM GS. It's in the middleware where services made their most of the killings.

Overall I think market should get ready for major open source initiatives by leading software/application vendors. Using Moore's core-versus-context analysis, this time companies wont just outsource their contextual technologies , they will also open source it.

In an economy where one company's context is another company's core, you will see a strong deflationary trend in the short term due to open sourcing of proprietary apps.

In the mid-to-long term companies will have invent their new value chain.

Dewey Decimal System for business XML

Mark Gibbs in Network World -

XML became balkanized into dialects, one for each purpose and each assigned different
names with often different meanings to each entity they were
describing. This was a big problem.

So if you and I are using different schemas and we want to
intercommunicate we are reduced to hiring a data architect and a
programmer to create some kind of translation mechanism.

But there is a better way: The Universal Data Element Framework
(UDEF) is a cross-industry metadata identification strategy. The
intention is to provide a means of real-time identification for
semantic equivalency, as an attribute to data elements within
e-business document and integration formats.

To put that another way, UDEF aims to be the Dewey Decimal
system for structured business-to-business messaging. You can
think of UDEF as replacing the many-to-many links between
businesses exchanging data with conceptually a single semantic
hub that provides common ground.

But the power of UDEF is that it will probably take care of the
translation of the majority of entities leaving just a handful
that will require more sophisticated translation to be carried
out by custom code. And for run-of-the-mill business purposes,
UDEF will most likely do it all.

More info here:-
UDEF home page
Oasis Cover Pages
UDEF Compare report example

India-Flickering Not India-Shining

Foreigner, Gandhi, Inexperienced And add Reluctant to that list which characterizes Sonia Gandhi, according to all her critics. There is lot of Sonia-worship. Sonia-bashing and Sonia-mania going on in India right now. Having gone through few intense discussions with friends (who are in India) this topic of whether she-should or should-not become PM has acquired a life of it's own. Now that she has rather melodramatically stepped down from that contention. It begs a deeper scrutiny of this strong outpouring of Sonia-bashing. And later in the day when ex-colleague asked for my 2 cents on Yahoo news related to the same topic , I thought of elaborating on this topic bit methodically.

There is intense cynicism and frustration in India right now specially among the segment which you can safely label as "better off and better educated " about how Congress and other "retro" parties have spoiled the "India-shinning" party. This has caused so much anguish that even rational voices have started dreaming of benign dictatorship and some people are nursing their bruised nationalistic pride on anticipating the possibility of some Italian-born lady becoming their prime minister.

Though not everything is as clear as one would like it to be. Frustrations are coming along two lines, first one relates to the lack of confidence in the "India shinning" project. Though there is no strong indications to that effect except some careless remarks by the pathetic Communist party members, market has already zig-zagged to make some historical dips. Second one relates to the growth in conservative political ideology among "better off and better educated" which is used largely to justify their economic goals. Though this second phenomena is ironically more global in nature.

Suffering a stunning defeat on these two fronts and finally seeing (as if to rub it in) the prospect of having yet-another-Gandhi acting as a PM really made all the political fence-sitters run to their online petitions and blog sites to vent out. Though I agree to some of the arguments related to shameless investment in Gandhi-name and Sonia's political inexperience. what really bothers me is the utter silence of these same Sonia-bashers and other India-shinning advocates on the issues of Gujarat riots, economic disparity within India and the actual reasons why voters went for this result. Why are some states still caught-up in the class-struggle which in Indian setting invariably means caste-struggle ? Who is paying the price of their neglect of social and political reality. It makes for a lame excuse to just say that few Indian states don't get it because of their caste based political inclination.

There are no easy solutions, no matter how you spin it all parties are similar in their power grab struggles. Only way they differ is in the definition of their core audience. Though it's extremely difficult for all BJP supporters to do (I would say impossible !) but if they really want their party to come out as a national party with national issues then they need to act on following points -

- Close all RSS, Bajrang Dal and VHP operations and make a clean separation from their divisive ideology
- Invest in issues based politics built on the secular platform
- "Steal" class/caste initiatives as currently championed by state level parties by convincingly building a diverse support base
- and develop a portfolio of deep-impact projects comprised of primary education (this is most important, atleast it will stop all intellectuals to stop acting as if they know too much about the illiterate masses), infrastructure, and secular social fabric.

Problem with this model is that it calls for investment in future. With less than 20% of Indian population now plugged into the global market - which is extremely impatient of slow moving political and social processes (their patience is a function of their bandwidth speed !) - for them future is getting invented at breakneck speed. It seems nobody has patience and political capital to push these big rocks.

On the Congress party side, Sonia Gandhi factor will be exploited by few spineless politicians. Her stand on most of the issues is still enigma to me. If they really want to come back as the Congress party of yesteryears then they need to act on few areas -

- Give complete autonomy to Manmohan Singh. He is the true initiator of this India-shinning project and has good macro-level economic understanding to solve pressing problems
- Parties which are supporting Congress should make sure Manmohan Singh has enough "operational freedom" to do the right thing and not get pushed around by vested interests from within Congress party

In a situation where every party is focused on the short-term goals, you get India-flickering not India shining.
If it has to shine then India needs to make sure that the beacon lights are angled at a fairly high height so that the majority can see it's light not just those who are plugged-in.