Will Facebook Buy Skype?

Reports indicate that Facebook CEO Mark Zuckerberg is talking to Skype about either buying the company or forming a joint venture, according to Reuters.

One of the sources said Facebook is considering a buyout of Skype at a price of between $3 billion and $4 billion.

The other source told Reuters the deal won’t be a purchase by Facebook but rather a joint venture between Facebook and Skype.

Skype and Facebook are no strangers. In October, when Skype released its version 5.0 software for Windows, it included a Facebook tab that let users chat or call Facebook friends via Skype, right from the Facebook newsfeed that can be viewed from within the Skype application.

Facebook isn’t the only one chasing Skype. One of the sources talking to Reuters added that Google was also in “early talks” with Skype about a joint venture.

When we contacted Skype Wednesday night, the company responded, “As a practical matter, we avoid commenting on rumor and speculation.”

Let us know in the comments what you think of this deal and who stands to gain the most.

Source: Reuters+Agencies

Global recession; Wipro customers cancel contracts!

Indian IT outsourcing company Wipro is seeing a few customers cancel contracts and more delaying or downsizing deals as a result of deteriorating global economic conditions, its joint chief executive said.

Girish Paranjpe added that Wipro, India's third-biggest software services exporter, was feeling minimal impact from last week's attacks that killed almost 200 people in Mumbai, and reiterated that the company expects business to improve next year.

Referring to the Mumbai attacks, he told Reuters in an interview on Monday, "I don't see any operational impact of that ..."

When asked about cancellations by Wipro's customers -- who include Cicso, Credit Suisse and Nortel -- he said: "Some few, but much more delay, postponement, resizing -- a few cancellations."

Paranjpe said he remained hopeful that business would pick up in the company's first quarter beginning in April next year after a slowing that began about a quarter ago. Customers cannot sustain constrained spending indefinitely, he said.

"About six months you can manage with compression, three to six months you can manage with compression. Beyond that, you have to start thinking longer-term," he said.

"I'm still kind of optimistic that we would have gone past the bottom some time in the first fiscal quarter" next year, he added.

Sector leader Tata Consultancy Services and fellow large Indian outsourcer Infosys have recently expressed cautious optimism about the market, but like most peers they face at least short-term uncertainty.

Wipro makes about half its revenue in the Americas, and about a quarter globally from the financial services sector -- a fairly typical business split among Indian outsourcers, whose large English-speaking workforces gave them an early advantage.

Asked how tough price negotiations were becoming, Paranjpe said Wipro was trying to help customers cut costs in other ways than lowering prices. "There is a discussion about how we can alleviate the pain that they are going through. Our discussion has been about how we can help them with cost, rather than focused on price."

"That's what clients ultimately care about: Given the downturn, how much has my budget gone down and to what extent can you contribute to help me bridge the gap?" he said.

Paranjpe argued that big players like Wipro stood to gain market share as customers looked for reliable partners. "You want fewer people you can bet on, who are going to survive the downturn as well. So there is an almost automatic flight to size and quality," he said.

Although consolidation in the financial sector would undoubtedly make for a tougher market, Paranjpe said it would also bring opportunities in the medium term as customers would have to integrate and streamline their operations.

It would also bring chances to make acquisitions as valuations dropped -- possibly large ones, after last year's $600 million buy of Infocrossing -- and to make selective hires of personnel who might have been unaffordable in better times.

"I think we have gone past the small-budget acquisitions, which is not to say that we will never do a small one, but which is also to say that big dollar signs don't scare us," he said.

"We would like all the acquisitions to be made outside India so we can globalise our workforce."
Asked about the effect of the weakening rupee and stronger dollar on Wipro's results, Paranjpe said, "It's dizzying, actually. It's completely roller-coaster, on the currency side."

"So what we have decided is that we will simply go hedge, for a certain duration, and let our treasury worry about that, and the business will really focus on generating profits from operations," he said.

Wipro will be more cautious about spending but does not plan a hiring or travel freeze, Paranjpe said.

"Building our new facilities we're kind of watching more carefully, hiring lots more people. We're kind of being circumspect about spending on marketing ... being more cautious about travel."
"Full-page ads are out," he added. "Any business which has been in full growth mode for five years does accumulate a certain amount of excess baggage."

Source: Reuters

Who are the militants behind the Mumbai attacks?

Militants armed with automatic weapons and grenades attacked luxury hotels, hospitals and a famous tourist cafe in India's commercial capital Mumbai late on Wednesday, killing at least 101 people.

Who is behind the attacks?

Witnesses say the attackers were young South Asian men speaking Hindi or Urdu, suggesting they are probably members of an Indian militant group rather than foreigners.

The attacks were claimed by a previously unknown group calling itself the Deccan Mujahideen in an e-mail to news organisations. Deccan is an area of southern India. Analysts say that while it is not clear whether the claim is genuine, the attacks were most likely carried out by a group called the Indian Mujahideen. The name used in the claim of responsibility suggests the attackers could be members of a south Indian offshoot or cell of the Indian Mujahideen.

Who are the Indian Mujahideen?

Indian police say the Indian Mujahideen is an offshoot of the banned Students' Islamic Movement of India (SIMI), but that local Muslims appear to have been given training and backing from militant groups in neighbouring Pakistan and Bangladesh.

SIMI has been blamed by police for almost every major bomb attack in India, including explosions on commuter trains in Mumbai two years ago that killed 187 people.

Police said the Indian Mujahideen may also include former members of th Bangladeshi militant group Harkat-ul-Jihad al Islami.

In an e-mail to various media in September, the group denounced Mumbai's police anti-terrorist squad, accusing them of harassing Muslims.

"If this is the degree your arrogance has reached, and if you think that by these stunts you can scare us, then let the Indian Mujahideen warn all the people of Mumbai that whatever deadly attacks Mumbaikars will face in future, their responsibility would lie with the Mumbai ATS and their guardians," it said.

The Indian Mujahideen have made credible claims of responsibility for most of the recent major attacks on civilian targets in India over the past two years.

The Mumbai attacks appear to have been carefully co-ordinated, well-planned and involved a large number of attackers. A high level of sophistication has also been a hallmark of previous attacks by the Indian Mujahideen.

The Mumbai attacks also focused clearly on tourist targets, including two luxury hotels and a famous cafe.

In May, the Indian Mujahideen made a specific threat to attack tourist sites in India unless the government stopped supporting the United States in the international arena.

The threat was made in an e-mail claiming responsibility for bomb attacks that killed 63 people in the tourist city of Jaipur. The e-mail, signed by "Guru Al-Hindi", declared "open war against India" and included the serial number of one of the bicycles on which the bombs were left.

Witnesses in Mumbai say the attackers in Mumbai singled out Americans and Britons in their attacks.

The group first emerged during a wave of bombings in the northern state of Uttar Pradesh in November 2007, sending an e-mail to media outlets just before some of the bombs exploded. Their next attacks were the Jaipur blasts.

On July 25, eight small bomb attacks in the IT city of Bangalore on July 25 that killed at least one person and wounded 15. There was no known claim of responsibility.

But a day later, at least 16 bombs exploded in Ahmedabad in the state of Gujarat, killing 45 and wounding 161. Shortly before the blasts, an e-mail in the name of the Indian Mujahideen was sent to local media warning that people would soon "feel the terror of death" in the name of Allah.

It said the attacks were revenge for the Gujarat riots of 2002, when around 2,500 people, most of them Muslims, were killed by Hindu mobs. A later e-mail accused several state governments of harassing, imprisoning and torturing Muslims and threatened consequences if they did not stop.

In September, at least five bombs exploded in crowded markets and streets in New Delhi, killing at least 18 people. The Indian Mujahideen sent out an e-mail moments after the first blast in New Delhi, saying the explosions were to prove its capability to strike in the most secure of Indian cities.

All previous incidents in which the Indian Mujahideen are suspected of involvement involved co-ordinated serial bombs. The Mumbai attacks also show clear signs of co-ordination but were carried out by gunmen, some carrying grenades.

The tactics, a military-style assault on soft targets, singling out foreigners, and taking hostages, are rare and do not fit the usual methods of militant attacks on civilian areas.

However, similar attacks have been carried out before, notably the May 2004 attacks in the eastern Saudi city of Khobar.

Gunmen attacked two oil industry installations and a foreign workers' housing complex in the city, taking more than 50 hostages and killing 22 of them. The attackers asked hostages whether they were Christian or Muslim before deciding whom to kill.

Source: Reuters

Mumbai attacks will not slow investment, says Kamal Nath

Trade Minister Kamal Nath said on Thursday the attacks on high profile targets in the country's commercial capital would not slow investment into an ecomomy already under strain.

At least 101 people were killed by gunmen in the attacks on some of Mumbai's top hotels, a popular cafe, a busy railway station and other locations. Hostages were taken in two of the hotels.

"This does not have an economic component. It's an unfortunate event. These type of things have happened in New York and other major cities," Nath told Reuters by telephone.
"(There will be) no slowdown in investment flows."

The global downturn has already rattled Indian financial markets and a credit squeeze has prompted the government and central bank to take a series of measures to lift sagging growth.
The Reserve Bank expects the economy to expand by 7.5-8 percent in the 2008-09 fiscal year, slowing from 9 percent posted in the last three years.

India's capital market regulator said the country's two major stock exchanges would remain closed on Thursday.

Source: Reuters

Is Wipro facing impact of global woes?

Wipro in India sees the impact of the financial crisis in the form of lower demand output.

This is the view of Wipro CFO Suresh Senapaty during a television interview at the Reuters India Investment summit in Bangalore.

To check out the video interview...click on the video below:
http://in.reuters.com/news/video?videoId=94456&videoChannel=104

IBM India continues to hire despite recession

IBM's India BPO continues to hire and has not yet seen any impact of a slowdown.

That is the view of Sandip Patel, managing partner of IBM's global business services in India and South Asia, during a television interview at the Reuters India Investment Summit in Bangalore.

To check out the video interview...click on the link below:

http://in.reuters.com/news/video?videoId=94457&videoChannel=104

Online networks helps job-seekers

Janel Landon, who runs a small PR consultancy in Chicago, has long been aware of the potential of online networks: now in her mid-50s and facing a global recession, she's decided to sign up.
"Given the state of the economy, I recently decided to jump on board," Landon told Reuters. "Professional networking is a 'must do' during unstable economic times."

The economic crisis slamming firms across the globe has sparked a spike in usage of professional networks -- Xing and LinkedIn are key sites -- as people hedge against losing work and laid-off employees seek jobs.

U.S. unemployment hit a new 14-year high in October and according to online job advertising firm Monster, recruitment activity on the Web plunged to its lowest level in nearly three years. Jobless rates are also rising in Europe.

Traffic on the world's top professional Web networks has surged since the financial crisis started to make headlines, with top player, privately held LinkedIn, notching 25 percent more registrations in September than forecast.

"Nobody has ever seen anything like this before," said Kevin Eyres, head of LinkedIn's operations in Europe. "Now we are growing by almost one new user each second."

Membership on LinkedIn has jumped to more than 31 million from 18 million at the start of the year, growing fastest in the financial services, media, education and technology fields, Eyres said. The firm has not disclosed any financial details.

To read on...click on the link below:
http://in.reuters.com/article/technologyNews/idINIndia-36700120081126?pageNumber=1&virtualBrandChannel=0

Will Citi bailout end fancy pay?

Citigroup's top executives could forego some of their compensation as a condition of the bank’s bailout, but that may not satisfy critics who want firm limits on the earnings of leaders at companies getting government help. Citigroup, the latest financial institution lining up for federal help to shore up its finances, must submit an executive pay plan for government approval as part of its rescue. The plan should focus on rewarding long-term performance and contain “appropriate limitations,” the bailout agreement says.

A Citigroup spokesperson, Stephen Cohen, said on Monday that details of the pay plan were being worked out, and that no deadline for its submission has yet been announced. He declined to comment on which executives from the bank, which is getting $20 billion in new capital and an agreement from the government to shoulder the bulk of potential losses from $306 billion of toxic assets, would be subject to the pay rules.

Government officials have said more details on the compensation arrangement would be available next week. Citigroup’s chief financial officer, Gary Crittenden, said on CNBC television on Monday that the pay plan would affect 2008 compensation for some executives but offered few other details besides saying, “I know it will be done the right way.”

Source: Reuters

Will US govt bail out Bank of America next?

US government rescue plan has eased investors’ concerns about Citigroup, but mines lurking in the balance sheets of rivals including Bank of America still tempt shortsellers. Bank of America, the No 3 US bank by assets, has loaded up on mortgages as the world’s largest economy wrestles with the worst housing market since the Great Depression.

The Charlotte, North Carolina-based bank further heightened its exposure to home loans by acquiring Countrywide Financial, the largest US independent mortgage lender and agreeing to buy Merrill Lynch, which owns the world’s largest retail brokerage.

If losses on mortgages and other debt securities mount significantly, the bank may see the ratio of equity to risk-weighted assets, known as Tier-1 capital, dwindle to alarmingly low levels.
“I would expect there are more banks who are in dire straits and more who can expect to be helped,” said Michael Farr, president of investment management company Farr, Miller & Washington in Washington, DC. “The share price makes it look like Bank of America might be next in line,” he said.

Before Monday’s stock market rally, Bank of America shares had lost 52% in November alone, making them the second biggest decliner for the month in the KBW Banks index after Citigroup. Analysts at independent research company CreditSights forecast that in a scenario where the commercial and residential real estate markets really tank beyond banks’ expectations, Bank of America would have a Tier-1 capital ratio of 7.15%.

The minimum that regulators seek to consider a bank “well capitalized” is 6%, but any ratio near or below 7% tends to spook investors. Bank of America declined comment. CreditSights also expressed concern about Wells Fargo, which it said would have a Tier-1 capital ratio of 6.98% under its worst case scenario. Wells Fargo recently agreed to buy Wachovia.

Under the same assumptions, and before the government’s latest investment, Citigroup would have a Tier-1 capital ratio of 8.64%.

American Express CEO for Citi Bank?
Vikram pandit may thank the TINA (there is no alternative) factor for still being in job as Citigroup CEO, as the US government reportedly did not push for his ouster in its rescue package. A day after the mega rescue plan, it has now come out that the authorities discussed whether to replace Pandit as Citi CEO, but there was an disagreement over the issue. A report from a US business daily has said that the name of American Express CEO Kenneth Chenault had emerged as a possible replacement.

Source: Reuters