In case you have read this blog in the last few years you will have noticed that ever so often there is an article about China winning over in high-tech.

I have a special relationship to China because I lived and worked in Shanghai and Hong Kong for a few years when Hong Kong was still British. Also in the more than 10 years since then I was every year a few times in China for business development assignments.

Now since about 2-3 years things changed as for more and more clients China has shifted from being a country with unlimited growth potential to their number one competitor. And also my attitude to China has shifted from being enthusiastic (I learned some Mandarin even) more than 10 years ago, to doing some business (albeit very hard negotiations and never very profitable) to facing a competitor that is out to kill you and uses any legal and illegal business practices to do so.

I heard that China has taken on about 50 industries where they want to become the dominating force. In order to get there fast, copyright infringements are the way to go which companies like Cisco (Huawei stealing their IOS and copying routers 1:1) or Ericsson (an Ericsson BCS looked identical to that of Huawei) have experienced first-hand. If I tell people that you always loose against the Chinese it’s only a matter of how much, they are mostly puzzled and do not seem to understand. Of course my experience with them dates back nearly 15 years and is therefore further developed going through the three stages mentioned. Most people doing business with China these days and being enthusiastic are in stage 1 still. I am convinced that they will go through the same experience over time. I was thinking what I could tell them to make sure they do not loose out as well and came up with this list:

• don’t shift technology know-how to China even if they demand it and make business dependent on it
• in case they demand it then better do not comply and manufacture elsewhere in Asia, cost-wise there is no reason to be in China any longer
• increase your intellectual property security mechanisms, make sure there is no single point where all infos are stored and can be accessed, also encrypt all data, enforce security policies like a bank
• in order to stay competitive you must keep innovating, while this is sort of a no-brainer in high-tech it is even more so critical if Chinese companies start copying you
• make product marketing and product management one of your key strengths
• do not underestimate the Chinese competitors but study them the same way you study other competitors, always assume that they will soon be able to deliver the same quality products but for much less
• in case the Chinese partners demand something unusual not acceptable to you and insist on it walk out the door, one way that Chinese typically win in negotiations is knowing that Western managers have 3 or a few more months of reporting cycles and need to show results so are desperate, turn this around and make the Chinese feel uncomfortable and desperate, this requires an open-ended long term (years) approach on your side, in case you don’t have that, do not even start negotiating
• try over the years to bridge the intercultural gap, the new generations in China are changing also their attitudes becoming more westernized, it helps if you learn at least some Mandarin, BUT don’t try to do business with it, you do not want to have another disadvantage
• build your strategy not on China alone but have at least one or two other regions where you develop business so that you can shift focus in case it is needed

Yesterday IBM announced the acquisition of DemandTec for $440 million. The company has hundreds of customers such as in retail and government helping them analyzing and deriving conclusions from massive amounts of company collected data.

“Big data”  as the name suggests has to do with masses of data collected from just about everywhere. We talk about terabytes and more of data collected from all kinds of sources such as information-sensing mobile devices, aerial sensory technologies, cameras, microphones, RFID readers, wireless sensor networks, social media, buying patterns and so on. The fact that 90% of the data in the world today was created within the past two years makes this an even bigger challenge as it is a constantly moving target. Currently used relational databases and  desktop statistics/visualization packages cannot deal with this unstructured data requiring instead massively parallel software running on large computers often grids of dozens, hundreds or even more of servers.

Its not surprising that Google is into this for quite a while since their search algorithm is doing exactly what big data is all about: collecting massive amounts of data and making decisions (search) based on analyzing them. Google is offering access to compute power now even to enterprises with its service BigQuery. More also in this Google blog.  Google was also there right at the beginning with its framework MapReduce that was then used in projects by others such as Yahoo leading to Hadoop, a story on this you find here.

Data collected are e.g. from web logs; RFID sensor networks; social networks; social data, Internet text and documents; Internet search indexing; call detail records; astronomy, atmospheric science, genomics, biogeochemical, biological, and other complex and/or interdisciplinary scientific research; military surveillance; medical records; photography archives; video archives; and large-scale eCommerce.

A McKinsey report on Big Data mentions e.g. these points:

• The use of big data will underpin new waves of productivity growth and consumer surplus. For example, we estimate that a retailer using big data to the full has the potential to increase its operating margin by more than 60 percent.
• The computer and electronic products and information sectors, as well as finance and insurance, and government are poised to gain substantially from the use of big data.
• Policies related to privacy, security, intellectual property, and even liability will need to be addressed in a big data world.

Today I attended The Green Grid meeting in Paris at the Schneider Electric headquarters.

The Green Grid has made itself a name by being able to have three continents (US, Europe, Asia) to agree on a clear definition on how to calculate the PUE (Power Usage Efficiency) metric. The PUE value is inside a data center the power ratio of the total power used by the whole facility divided by the power used up by IT equipment. A PUE value of 1.3 means e.g. that 30% of the total power used is for cooling, power loss and other facility sources on top of the power used for IT (1.0). So the smaller the value the more efficient the data center. Of course this value depends on when it is being measured. During a cold winter day it will be better than during a hot summer day assuming free cooling is being used. The Green Grid wants data centers to measure the value over a period of 12 months which makes lots of sense.

Now PUE might not necessarily be the best value to use although it is great as mentioned that a metric has been agreed on internationally. There are the following shortcomings:

• PUE does not include information on availability, a more redundant data center would have naturally a higher PUE than a very low or not redundant data center
• total utilization of a data center is also not reflected, a new big data center with few clients can have the most innovative green measures in place but still achieve a bad PUE
• it is also very possible that measures reducing IT load such as consolidation of servers enabled with virtualization increase the PUE
• while electrical energy is important to look at also water used, CO2 production, reuse of waste energy and other resource efficiencies are not reflected
• an older data center will most likely have PUE values that will be higher than a new data center with latest innovative cooling systems used

What will be next in data communications infrastructure innovation one might have asked already a few years ago. With 1G interfaces well installed everywhere and 10G also becoming the norm in datacenter backbones it seems a longer way to reach 40 or even 100G mostly due to physical limitations. While the innovation buzz has shifted in ICT to cloud computing it seems, the good old networking infrastructure vendors have to look for their next spotlight. This could well become Open Flow which promises to provide lower cost networking connectivity. A few startups that are still in developing and/or in stealth mode such as Big Switch or Niceria promise to challenge the established vendors soon.

latest news: interesting is that also IBM, who departed routing and switching as well as optical communications long time ago jumps back onto this opportunity.

The probably most visible European ICT startup ever Skype changes hands again. And this time Microsoft pays a huge premium that most analysts who don’t get the hightech world don’t understand. Of course Skype is not worth 8.5 billion USD, and Microsoft knew that, but this deal was a fight between Google and Microsoft and Google dropped the ball at 8 billion or so deciding to better build than buy.

What will Microsoft now do with Skype? Well that will be interesting to see. They could with their financial power create a very powerful telco where you communicate from your desktop, laptop or mobile with your peers. Microsoft has other technology in the unified communications area and could well integrate this all offering their enterprise customers local as well as wide area networking over the Internet heads on competing with the telcos.

If this indeed happens we will see. Guys like Cringely doubt it. I am not so sure if he is right though… ICT markets keep spinning fast and remain highly interesting.

This week’s EURO mess showed a few things that one might have suspected beforehand but only became evident when the crisis hit, and there are good chances now to fix issues finally.

• German - French friendship seems more for political show than something Europe could rely on in a crisis.
• In contrast, the Swiss showed where their real interests lie and supported the Euro heavily with their national bank which already holds two thirds of its reserves in Euros.
• Deutsche Bank and others are actually more interested in making tons of money in such a situation than stabilizing the markets. Total trading transparency and control are inevitable in the near future meaning NOW to show who follows what interests.
• Even though the UK has just had a change of government it also became clear that Europe is somewhat a club without them. If one looks at the fall in the British pound in the last few years the Euro is a safe currency in comparison. I think the UK needs to decide if they want to really become part of a European system or stay isolated on their island somewhere in no man’s land between Europe and the US. It is their call.
• Without strict fiscal control of Euro countries and punishments when needed this will not work; it looks like Germany is taking on the role of watchdog, which might be a good thing for all in the end.
• Countries can become bankrupt and the financial institutions who lend them money can’t hope anymore so that the taxpayers pay for eventual losses; the same will be true for big banks.
• update: This here is a good contribution in the Swiss newspaper Tagesanzeiger. The author suggests that the EURO countries include into their constitutions a maximum debt threshold. That way - assuming the countries respect their constitutions -  each country can separate the discussion from politics since it becomes a law. Germany followed last year Switzerland doing exactly that.

I had asked not long ago in a blog post here “SAP - Quo Vadis?”, raising the question why they don’t get a database and also invest more into mobile enterprise software suggesting they should do acquisitions. And voila, SAP will buy database and mobile application specialist Sybase for about $6 billion.

Competition is heating up in the tech sector where the big ones need to offer most solutions that enterprise customers might need. This is also triggered and accelerated by e.g. Google who is increasingly becoming a software application player making its web-based Google Docs more robust and adding missing features to catch up with Microsoft. Microsoft itself needs to look for other software opportunities such as enterprise resource planning interfering with e.g. SAP. The list goes on and on and one can expect that Oracle, Microsoft, Cisco, HP, Google and IBM will continue their acquisition strategy and become increasingly more competitors.

Yesterday Microsoft launched at a press conference event in New York SharePoint 2010 which offers better social collaboration features than the former SharePoint.

Compared with other pure social collaboration offers Microsoft is quite late, lacks key features, will be expensive to implement, make you vendor dependent and will still be bought by most corporations IT departments who don’t care much and just want to add a check mark at their users’ requests for better collaboration tools.

Forrester commented in a similar way:

At the end of the day, Forrester clients seem to be falling into one of three buckets:

• Those that are committed to SharePoint and are planning to take the native social capabilities, even if it means being a bit behind the cutting edge.
• Those that want the latest and greatest in social technology in their enterprise and will pursue a pure social technology offering.
• Those that want both and will look for a pure social offering with deep integration with SharePoint.

Today the Swiss government officially launched the so called SuisseID which allows for secure Internet transactions. Application areas will be:

• e-government, allows you to do more and more simply online
• e-signature, allowing you to sign a contract online (need an additional software for that such as SwissSigner10 and is also supported by Adobe 9)
• as a login/authentication mechanism to use web applications that support SuisseID

The Swiss Post is the official distribution partner for the SuisseID. You need to fill out a form online and then go to a post office to verify with your current ID such as a passport to obtain the chip card with your ID. There are then three ways to use it: simple USB reader that holds the chip, USB stick that holds the chip and also contains more software such as a secure browser and the SwissSigner10 software to do online signatures, or a plastic card (the size of a credit card) that works with a card reader.

I looked into it as a way to do online signatures for us but then decided that we actually don’t need it right now or the 238 CHF for this option is not worth it. Probably for a company who does many contracts this is a small worthwhile investment though. The option with USB reader only is quite cheap with 39 CHF. For doing e-government this is worth paying I think and once I am officially Swiss will probably get one to be able to vote online and use other e-government services conveniently.

As mentioned in a GigaOm post Skype is growing by leaps and bounds with no slowing in sight. 12% of all international long distance call minutes are made with Skype now. They also rolled out recently a few new features nearly quietly such as public Wifi access (I was surprised to suddenly get the option in a public Wifi hotspot to pay through Skype, but that made lots of sense as it speeds up the sign on process), screen sharing (this feature is not made very public either and I only heard about it today, you need to enable it in the menu bar under Call/Share Screen) and then they seem to have further improved the call quality (the call quality is simply excellent and I practically hear no difference if I talk to someone in the country, in China or the US, maybe initial delays but that goes away too quickly).

And then they have currently big efforts under way to bring Skype onto mobile phones working over wireless networks.