Summit Notebook

IBM skips around China Internet censorship

Foreign companies in China, which has the world’s biggest online community, have faced allegations of bowing to censorship rules in their hunt for market access. To be careful, they usually avoid questions on the subject altogether or deflect them with humour.

“I don’t think I am the expert to comment on this,” Shirley Yu-Tsui, a vice president of strategy for IBM greater China, said at the Reuters China Investment Summit.

“All I know is my children complain they can not get on Facebook,” she said.

The subject is very serious, as companies such as Google and Yahoo have had their executives called to face angry congressional questioning in the United States to explain their business practices in China.

“I don’t think they would come to IBM for that,” said Yu-Tsui when asked what IBM would do if asked to help monitor traffic on China’s Internet.

China backed down only last month from a plan to pre-install the controversial “Green Dam” Internet filtering software on all personal computers sold in the country.

Photo Caption: Shirley Yu-Tsui, a vice president of strategy for IBM greater China. REUTERS/Christina Hu

IBM: No Sun, but there are other fish in the sea

IBM’s Chief Financial Officer Mark Loughridge didn’t have much to say about Oracle’s planned purchase of Sun Microsystems at the Reuters Global Technology Summit.

I don’t see that much has changed in this. They have been partnering for decades. It doesn’t fundamentally change the position” in the industry.

Loughridge also wondered aloud how Oracle was going to handle Sun’s hardware business, given that its expertise is in business software.

I think it’s going to be pretty tough to just announce that you’re now going to be a hardware business. It’s a fundamentally different business… it’s not like you have a track record in managing that kind of acquisition.

As you may recall, IBM lost out to Oracle in the bid for Sun Microsystems. The world first came to know a couple of months ago that IBM and Sun were in exclusive acquisition talks, but those discussions fell through because of differences on deal guarantees and fears of extended antitrust scrutiny. Soon after, Oracle and Sun announced their $7.4 billion deal, and sources told Reuters at the time IBM didn’t know this would happen until the night before the announcement.

Were Loughridge’s comments to Reuters a case of the proverbial sour grapes? Analysts have already said they expect IBM to now be even more acquisitive. Big Blue has the cash to do it and Loughridge said the M&A landscape was “fertile” at the moment, with valuations very attractive.

We looked at acquisitions back in the mid-1990s as opportunistic.

Audio – Outsourcing daily life

At the Reuters India Investment Summit we asked Managing Partner of IBM Global Services Sandip Patel about the first thing he would like to outsource from his daily life. His response, perhaps instinctively, was automating the cleanup of thousands of his emails.

Anantha Radhakrishnan, Vice President at Infosys BPO, yearned for extended telecommuting to cut down on travel time (and probably cost as well!!) when asked the same question.

Evidently, productivity improvements and radical cost-cutting measures are weighing heavily on the minds of corporate big wigs these days.

The BPO services industry, which was once able to fund disproportionately high wages and lavish perks for employees, is now plagued with rumours of disappearing stationary and depleting entertainment budgets all in the name of cutting costs.

Audio – Still holding out

One would expect a top executive of the world’s largest software services provider to hang out with the latest gadgets. Sandip Patel, Managing Partner for IBM Global Business Services in South Asia, seems to be quite the contrarian.

He is antagonized by even the most common gadget to adorn executive pockets in these times.

“I haven’t yet succumbed to the Blackberry,” Patel confessed when asked what phone he carries. He spoke at the Reuters India Investment Summit.

He proudly pulled out a well-worn Nokia E90 and admitted he wasn’t much of a gadget guy and just liked a good solid phone.