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But Wait, There's More
Congressman Introduces Bill That Could Curb Offshoring
The battle lines are being drawn between corporations and their workers, and it is now going to run right through the Congress. Last week, Representative Bernie Sanders, an independent from Vermont, introduced a bill called the Defending American Jobs Act of 2004, which will prevent companies from getting any federal assistance--including grants, loans, subsidies, tax breaks, or guarantees--if their layoffs in the United States are deeper than those overseas. The bill would also start keeping a strict accounting of job rolls by corporations in the United States, assessing which ones are hiring, firing, and offshoring. The proposed law would also require companies that receive such government funds--and just about every major corporation in the country does get some form of corporate welfare so it can remain competitive in overseas markets--to provide statistics about pay rates for workers at home and abroad. There are so many ways that big corporations benefit from government largesse that it is hard to quantify the benefits they get from government, but it is sufficient to guess that not getting money from Uncle Sam would seriously affect their abilities to show profits.
"Companies should not be asking for U.S. government handouts if they want to secretly throw American workers out on the street while they are expanding employment overseas," Sanders said in introducing the bill. "The American people have a right to know when American companies are exporting our jobs overseas. And, the American people also have a right not to give corporate welfare to those companies that are leaving the United States for India, China, or Mexico." But Sanders, who tends to be one of the more outspoken members of the House, didn't stop there in upbraiding corporations for their short-sighted behavior. "In my view, it is an insult to the middle class of this country, that American taxpayer dollars are being used to provide loans, loan guarantees, grants, tax breaks and subsidies to huge and profitable corporations who then say to the American people: 'Thanks for the welfare, chumps. But we're closing you're your plant and taking your job to China.' " Some 50 legislators in the House have backed the bill.
Several weeks ago, Senate Minority Leader Tom Daschle, of South Dakota, introduced the "Jobs for America" bill, which would force public companies to disclose how many jobs they are sending overseas, where they are going, and why they are being sent overseas. The proposed Senate law would require any company that lays off 15 or more workers to send those jobs overseas to give three months' notice to those employees and to send reports to the Department of Labor, so it can monitor the effects of offshoring.
SEC Extends Dates for Sarbanes-Oxley Compliance
If you are busting your hump to revise your computing systems to get compliant with the Sarbanes-Oxley Act, which is bringing more stringent accounting and reporting of public companies to bear in the wake of myriad accounting scandals, you just got a little more time. The Securities and Exchange Commission, which is implementing the law, originally required that any company with a market capitalization of $75 million or higher (which it deems an accelerated filer of corporate financial reports) had to be compliant with Sarbanes-Oxley by June 15. This date has been extended to November 15. Smaller companies originally had to be compliant by April 15, but now have been given until July 15.
Meta Group Says ERP Vendors Gearing Up to Go After SMBs
If you are a Windows shop or thinking of adopting Windows, the odds favor that you are a small or midsized firm. According to IT analysts at Meta Group, makers of ERP software are going to be banging on your doors a lot in the next two years to try to drum up some business. The SMB market accounts for about half of total worldwide IT spending, says Meta, and it is commonly said that the SMB space is growing at twice the rate of the large enterprise section of the IT biz, even in this down economy. So you can see why ERP vendors want to talk to you.
According to a recent analysis by Meta, SMBs that sell their products into larger enterprises are going to need ERP software makers, too, since larger enterprises are automating their supply chains to try to wring efficiencies and profits out of those chains. If you are an SMB, you are going to have to do EDI, B2B, RFID, and a whole alphabet soup of different kinds of things to link your systems into those of the companies that buy from you. This is going to mean either bolting on solutions to the sides of homegrown or third-party code or buying an integrated suite of products that provide such functions.
But sophisticated ERP software with SCM and CRM features has been very expensive to buy and implement, and the features for larger enterprises are usually overkill for an SMB customer that has to manage fewer products, fewer customers, fewer pricing schemes, and fewer suppliers of its own. Meta says that SMBs have to get more sophisticated not only about what ERP software they buy but also about how they buy. Carl Lehmann, vice president with Meta's technology research services unit, says that software makers are going to be rejiggering their technology, product lines, selling techniques, and pricing structures so they can become more appealing to SMBs in 2004 and 2005. This probably means a lower price for less function.
But Lehmann says that SMBs have to get more sophisticated, even as prices come down. "Vendors often try to base maintenance contract prices on the 'list price' of software licenses--usually 20 to 22 percent--when dealing with SMB buyers," he said. "It is important for SMB buyers to leverage the interest in their market and negotiate maintenance agreements based on 'as sold' prices, or contract deliverables in return for their business." He said that even SMBs could negotiate down to the 18 percent industry average for maintenance fees, or even lower. Telling customers what other people are paying is part of accomplishing this, which is why this story is in this newsletter. Information is power. Meta is also advising that SMBs that can't get the low prices they like to add maintenance contract deliverables, like support--troubleshooting, help desk, and patch administration--and future-release updates to the deals they strike. This may not lower the initial sticker price on ERP software, but it does lower ongoing costs. This is how the big companies do it.
AMD Drops Voltage to Create Low-Power Opteron HE, EE
by Timothy Prickett Morgan
A few weeks ago, when Intel was talking about its 64-bit extensions to its Pentium 4 Xeon processors at Intel Developer Forum, rival Advanced Micro Devices tried to steal a little thunder from Intel by launching its low-power 64-bit Opteron HE and EE processors, which burn a lot less electricity and crank out a lot less heat than normal Opterons delivering the same performance. At the time, we were not able to find out how AMD did this. Now we know.
As it turns out, according to Brent Kirby, AMD's product manager for its server and workstations group, the trick that AMD is using to create low-power Opterons is to drop the voltage. AMD has not cut the cache memory on the Opteron down from 1MB, nor has it moved from a 130 nanometer process to a 90 nanometer process to lower the power consumption and heat dissipation. You can't just drop the voltage on any old Opteron to accomplish this, says Kirby. AMD has to sort through the Opteron bins to find those Opterons that can run at the same rated clock speed as the regular Opterons, which range from 1.4GHz to 2.2GHz currently, but can do so at substantially lower voltage. Only a small percentage of them can do this, and the further the voltage drops, the fewer chips that can do this. Hence, AMD is charging a premium for those Opterons that offer the lowest power consumption. It's just a supply-demand curve.
Lower voltage means lower power consumption (since power is volts times amps), and that means lower heat. The regular Opterons crank out 89 watts running at 2 GHz at 1.5 volts, but finding an Opteron that can run at only 1.3 volts--seemingly a small change of only 13 percent in voltage--lowers the maximum heat dissipation to 50 watts, a drop of 44 percent. These are the Opteron HEs. AMD has found that it can drop the voltage on a number of Opterons to as low as 1.15 volts and still run them at normal clock speeds, dissipating only 30 watts when running at 2 GHz. That's a 23 percent drop in voltage for a 66 percent decrease in power consumption and heat dissipation, and these are the Opteron EEs.
All of the Opteron, Opteron HE, and Opteron EE processors have the same 940-pin design, which means that they can be used interchangeably in the same motherboards. AMD is charging the same amount of money for a 1.4 GHz/30 watt Opteron EE as it charges for a 2 GHz/55 watt Opteron HE as it is charging for a 2.2 GHz/89 watt Opteron. That's $733 for a uniprocessor version (100 series), $851 for a two-way capable Opteron (200 series), and $1,514 for a four-way version (800 series).
PartnerWorld 2004: Sam Plays It Again
by Dan Burger
You could say it was back by popular demand. After all, IBM has been promoting the on-demand concept for more than two years, and now it wants to make money from it, just as it did with e-business. Without a doubt, IBM's on-demand computing strategy was center stage at the annual conglomeration of business partners that convened in Las Vegas last week, where the safe bet was following Big Blue's advice: Get on board with on-demand computing and open standards.
The "on demand" terminology is nothing new to business partners or anyone who follows IBM, even from a distance. The IT industry giant has been characteristically vocal on this the topic for close to three years. Now that the door to a better economy seems to be creaking slowly open, IBM doesn't want any of its faithful partners forgetting the message or going forth confused about the plan.
Frankly, the on-demand strategy has been a little fuzzy to many people. IBM Chairman and CEO Sam Palmisano admitted as much in a speech that opened PartnerWorld 2004. Despite its high ranking on IBM's "to do" list, most people know "on demand" only as it relates to hardware and processing power: If you need more juice, it's only a phone call away. Palmisano (along with everyone else who collects a paycheck with IBM's name on it) is now on a mission to clarify, as well as expand, the understanding of the on-demand concept to a variety of processes, techniques, and schemes.
"On-demand computing isn't one thing; it's a combination of approaches to address what IBM sees as a fundamental change in how the IT industry operates," Palmisano told his PartnerWorld audience, which was estimated at more than 5,000 resellers, independent software vendors, integrators and consultants. "The client is forcing us to focus on solutions," Palmisano said. He spoke disparagingly of a recent era when IT companies threw technologies at customers, and he criticized the best-of-breed approach to building an IT infrastructure. (Any comparisons I might make at this point about politicians saying that government has to be responsive to the people would probably not fall on deaf ears. But government does need to be more responsive, and IT companies cannot just dump new technologies into data centers and walk away any more.)
In addition to the on-demand message, Palmisano tied in several other important themes during his address. Moving the customer base in the direction of open source solutions remains a constant theme. As expected, Palmisano chided IT vendors for their disjointed efforts at accepting of open standards. There was also the unmistakable and increasing interest in the small and midsized businesses market, a highly competitive battleground where IBM is undoubtedly pouring resources into such strategies as Linux and server consolidation. Both are important to the on-demand approach to winning more business.
IBM sees resellers and distributors playing critical roles in the on-demand operating environments customers require. The selling skills and industry knowledge of consultants and integrators need to be on demand in order to win customers. On demand is also used to describe the independent software vendors' industry specific solutions. For its part, IBM is rolling out product, training, marketing support, and sales incentives.
"You have to commit to our point of view. You have to commit to open standards. If you do that, we will invest with you, to help you become more successful," Palmisano said. The channel may be generating more of IBM's sales, but IBM is still calling the plays.
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