Category: Economy

Unrest in technolgy industry

Lot happened since I wrote my last blog: Steve Job left Apple’s chief executive office; HP came up with radically different business strategy; Facebook is working on a search tool; Google launched Google+; Google bought Motorola Mobility; Google bought IBM’s patents for undisclosed amount; Future of Android after Google’s acquisition of Motorola Mobility appears to be questionable; Microsoft continues to prove its copycat marketing strategy with Mango; It is more than obvious that personal computers migrating to legacy typewriter category; Oracle has the money and may have the desire to buy HP; Scientist found a planet made of diamond; gold deposits in earth were carried by asteroids – keep eye on those asteroid to monitor the gold value in financial market  and few other significant ones.

For each one of these events, I wanted to write a blog but unfortunately after 24th hour of a day, clock is reset for the next day and cycle repeated. And today, due to the heavy rain in Michigan my pre-quarter final cricket game got cancelled and got free few minutes and hence this blog post.

By watching the significant events in recent past, it is evident all the tech dinosaurs are roaming wild to avoid the next big tech asteroid.  In current market, it is a big business puzzle to predict the predator and prey due to growth acceleration rate in terms of consumer adoption in the technology segment. Lots of companies were formed in a garage with a simple idea and some of them were successful by simplifying the original idea and became a giant, and soon, it is worth for billions. Most of the overnight multi-billion dollar companies do not manufacture goods; do not provide a tangible service and hence very vulnerable for next big simpler idea.

Recent trends have been proving the 200 year old economics theory needs fundamental change. The economic value is not only measured by goods and services but by a geo-cosmic fiber created by invisible social network.

Dominant player in the technology company map is rapidly changing and player who is of size of a continent soon becomes unnoticeable island and vice-versa.  All recent activities in the technology segment are all about positioning to the uncharted journey of consumer trends. We wish we have a magic lens to preview the future but we don’t. We understand and agree no tool or process or person can predict the future precisely but people are capable of approximate or define it.

How do we approximate the future?

Keep in mind few concepts.

  • Timing is everything.
  • Learn history and study current.
  • Unleash the core and its dependencies.
  • Connect the dots.

Using the above concepts, how do we approximate the future of disk storage market segment?  It will become a 30-40 page research report to completely answer the question. So, the approach is to scratch the surface to provide an idea how to approximate the future with an example.

There are few dominant players in the storage industry like NetApp, EMC, IBM, Hitachi and etc. Today the storage is based on longitudinal magnetic recording or perpendicular magnetic recording. The limitation of this recording methods are competing requirement of read, write and stability. The size of storage unit using this technology ranges from 130 gb – 1 tb in square inch. The next generation recording will be based on shingled magnetic recording, bit patterned recording or thermally-assisted recording or combination of bit patterned and thermally assisted and over comes the limitation in the current recording methods. The storage unit size will range from 2 – 10 tb in square inch.

All the current, future magnetic and thermal recording is done by set of semiconductors. There are set of companies manufacture those semiconductors that are used in manufacturing the storage units. The trends of semiconductors are based on the advancement in the quantum physics and solid state physics. The trends of the solid state physics can be studied by research made in academia by monitoring the paper published in journals and forums (like carbon based semiconductors are emerging and future electronic devices like iPad will have almost zero mass and can be folded and kept inside a shirt pocket).  Connect all the above to trends of associated technology (quantum computing), problems faced by end users, problem introduced by the associated new technology trends, and etc. Being exhaustive in each step stated above will approximate the future of the storage industry.

All the current tech giants are performing the similar studies to define or approximate the future. They are defining their merger and acquisition strategy, corporate strategy, business strategy, collaborative strategy and competitive strategy. It has become more challenging due to fundamental change in economic valuation and hence the unreset in technology industry.

Time only can answer the actual results of these strategies of technology giants.

I wish I had more time to write less in this post.

2009 Economical-Magic

Flow of electron is current and flow of cash is economics. If no electron flow then there is no current and if there is no cash flow then there is no bright economy. It is as simple as that.

What is the solution for the current economic crisis?

Increase consumer confidence

Consumer confidence is measured by the consumer confidence index and it is record low now. Economics is a social science studies the production, distribution, consumption of good & services. Consumption is the driver for distribution and production. The consumer adapts a conservative approach for consumption of goods and services and hence there is a slow down in the whole cycle. The conservative approach chosen by the consumer due to bleak future.  Consumer are not spending due to uncertain future and current & near future depends on the consumer spend. I call this situation as “economical dead lock”. 

The lock only be released by consumers and it depends on creating HOPE in them. Any big events in first quarter of 2009 is going to create that hope in consumer. The big event could  categorically be under  geo-political, scientific invention, leadership, Government policy.

The president elect going to sworn in first quarter of 2009 and he already made clear that his top priority is to focus on economy. By introducing new policies, regulation and deregulation in certain areas, introducing all construction projects are likely would  provide confidence in consumer that there is a bright future ahead. That magic would release the economical dead lock. 

It is highly likely that global economy will turn around by 3rd or 4th quarter of 2009.