Archive for January, 2007

January 31, 2007

Tata-Corus deal closed, so What that means..??

India’s Tata Steel has won the bidding war for Anglo-Dutch steelmaker Corus Group with an $12.1 billion auction offer that trumped Brazilian rival Companhia Siderurgica Nacional.

What this means to Tata Steel?
with the trade barriers having been lowered, though not eliminated, most businesses have to align/ benchmark themselves against global practices. National beliefs, markets and boundaries have a role in shaping corporate strategy. But there are other forces as well – customers, technology, investors ! For many of the people in these the national borders, increasingly just mean additional/ specific documentation to be undertaken

For the tata’s this would mean that they would have about 50% of their revenues come from international customers/ operations. For a group which is as diversified and integrated into India as Tata, this is a significant change in their perceptions of business opportunities. Being a global company, does have advantages, but also different benchmarks and expectations. The next 5 years would show whether they have been able to graduate from an Indian Group to a Global group, keeping their core-values intact.

What this means to India?
A decade back, when pessimists thought that opening up of Indian economy will lead to the opposite result – all Indian companies being bought out by maruding foreigners but for the past few years, India Inc. has been looking abroad and lots of great buys have happened.

Tatas themselves have led the pack (with the acquiring of Tyco, Tetley, Daewoo’s Truck business and now Corus), like how they did in the last century – whether it be starting a premier institution – IISc & TIFR or starting aviation industry, steel production, Motors, Sofware services/Outsourcing (TCS)

It seems the phenomenon is spreading throughout, whether it is Pharma, Software/ITeS, Steel, Electronics, Beverages/FMCG… Even public sector companies like IOC and ONGC are refreshingly aggressive in this business. In the future, I would like to see mammoth companies like Indian Railways, SBI (and other group of Indian banks are much healthier than most Asian banks), BSNL, Power Corporations to be removed off their Shackles and enter the world economy in a big way.

and Interesting trend to notice.. Now, India’s FDI outflow is MORE than inflow. For long, Indians have obsessed about the amount of inbound FDI, especially when compared to China (India has received less in FDI inflows since 1991 than China will receive this year alone). Interestingly enough, with Tata-Corus deal and if Videocon takeover of Daewoo Electronics does go through, India’s FDI outflows will, for the first time, exceed FDI inflows. Effectively, the projections for 2006 are that India will receive $9 billion in inflows while outflows stand at $19 billion, spread across 100+ deals, turning India into a net exporter of capital (to be precise though, a lot of the external acquisitions are not funded by domestic capital, but from foreign sources). At the very least, the investment bankers among you, especially those working on outbound M&A deals, can expect a big, fat bonus this year.

We have just started as a trickle and it doesnt take a long time to become a flood, as all the individual droplets are getting bigger and their distance is getting smaller. I hope the Indian govt doesnt do any stupid things, as often as they do in the past, and be a silent pusher of Indian companies into the global arena.

Certainly interesting times ahead both for Tatas and India.

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January 30, 2007

Upgrade to Vista now or WAIT?

Most hyped Software Product released, with 6bn$ investment and over 5years in development – Finally Windows Vista is here. Now, Microsoft marketing blitz for Windows Vista has begun. Confusion and temptation of when to buying Vista?? is question of the season.

If you want a truly seamless transition to Vista – especially if you’re upgrading your existing PC versus buying a new one with it pre-installed – I’d say wait. Not the possible 11 months or so it will take for Service Pack 1 to come out, but maybe a month or two to let software and hardware vendors to work out the kinks with their apps and drivers.

Also, Vista haven’t publish kernel OS code for 3rd Third party tools/software. So you will not find any 3rd party software for Vista as of yet.

Its good to remember – Historically Microsoft releases a really shoddy product on its initial launch. Windows 95, Windows 98, Windows ME (never had a shining moment anyway), and Windows XP were all mediocre or even terrible until the first or even second service pack or equivalent, with the exception of ME which was just plain terrible.

Vista already has known issues with lots of common hardware. It also doesn’t seem to have *really compelling* features to drive an upgrade. And of course, the biggest reason to not upgrade now, is the COST.

January 30, 2007

Indi-list : an Idea that needs more hands

Indi-list : an Idea that needs more hands

January 30, 2007

Making Globalization Work by Joseph Stiglitz

An bold new insight about globalization from its one of the closest observers and toughest critic, Noble Prize winner-Sir Joseph Stiglitz .

Books draws equally from author’s academic expertise and his time spent on ground-0. Its very innovative and more practical vision for a successful and equitable world. Stiglitz focuses on policies that truly work, offering fresh new thinking about the questions that shape the globalization debate, including a plan to restructure a global financial system made unstable by America’s debt, ideas for how countries can grow without degrading the environment, a framework for free and fair global trade, and much more.

Stiglitz reveals that economic globalization continues to outpace both the political structures and the moral sensitivity required to ensure a just and sustainable world. And he makes plain the real work that all nations must undertake to realize that goal.

Recently The Hindu organized Lecture in Chennai, India about Making Globalization Work. you can find audio files of those interesting speech and Q&A below:

Introduction by N. Ravi, Editor, The Hindu (9.13 mins)
Lecture; Part 1 (8.48 mins)
Lecture; Part 2 (10.00 mins)
Lecture; Part 3 (5.18 mins)
Lecture; Part 4 (3.32 mins)
Lecture; Part 5 (7.02 mins)
Lecture; Part 6 (7.33 mins)
Lecture; Part 7 (10.08 mins)
Lecture; Part 8 (5.23 mins)
Question Time; Part 1 (11.23 mins)
Question Time; Part 2 (13.15 mins)
Question Time; Part 3 (16.42 mins)

Another interesting Q & A with Joseph Stiglitz – Click here

January 26, 2007

New ROI of blogging report from Forrester

Eversince Google’s high-profile buyout of YouTube, I was wondering about ROI and how this can be extended to blogs. During my quest to understand this better.. I landed on Forrester to find very interesting research.

The ROI Of Blogging: The “Why” And “How” Of External Blog Accountability

Many large companies stand on the brink of blogging, yet they are unwilling to take the plunge. Others, having dove in early, now face the challenge of managing existing blogs without the ability to show that they effectively support business goals. While blogging’s value can’t be measured precisely, marketers will find that calculating the ROI is easier than it looks. Following a three-step process, marketers can create a concrete picture of the key benefits, costs, and risks that blogging presents and understand how they are likely to impact business goals. This, in turn, enables marketers to answer the key questions, such as whether to blog or not to blog, or to make smart choices about an existing blog.

and follow-up research

Calculating The ROI Of Blogging: A Case Study, A Look At The ROI of General Motor’s FastLane Blog

Forrester used the process outlined in the first document in this series to calculate the ROI of General Motors’ FastLane blog; but, this is not merely an exercise to generate a number. Using scenarios, General Motors can understand the risk and impact of increases and decreases of a key metric — the number of press mentions — on the value of the blog. With this knowledge in hand, General Motors can make critical businesses decisions, such as whether to invest heavily in innovations that will rekindle press attention.

Metrics reflect the benefits:

These research deploy a framework to measure benefits of blogs.
Some common benefits highlighted are:

  • increased brand visibility, savings
  • from customer insights,
  • reduced impact from negative user-generated content,
  • increased sales efficiency
January 24, 2007

Yahoo… oho.. out of the game ??

Yahoo “blew it”, claims Wired in a lengthy expose. Company bounced back in the past five years, only to drop even deeper as it fell behind Google, the story alleges. It’s hard to argue with the raw data. Google’s revenues have taken a decisive lead over Yahoo’s.

Yahoo made two monumental mistakes: it failed to acquire Google in 2003 instead they allegedly brushed off the $5bn asking price, bidding a measly $3bn and it never properly integrated the 2002 Inktomi acquisition, a provider of pay-per-click advertising. The Inktomi deal is scheduled to be wrapped into the Yahoo business later this year, which is an embarrassment by all standards. The Inktomi dilemma is important, because Google has shown that good technology allows you marry the right advertiser with the right consumer/user.

But Yahoo also is betting on content much more than Google is. The firm is trying to be a destination rather than an information broker. Creating content is far more expensive than pointing people towards it.

Fact is: do a search on Google for anything. Anything at all. Then do the same search on Yahoo. One guess as to who comes up with more relevant data. One clue. It’s not Google. Come to think of it, Ask.com also has a better search than Google, and I know it’s not politically cool to say this on one of these sites, but so do MSN and AOL.

But Yahoo is falling behind, and if it allows this to continue, it risks becoming an acquisition target and Google is laughing all the way to the bank.

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