Taiwan is setting up a new company to pull together six struggling computer memory chip makers and bring in technology from Japan's Elpida or US-based Micron in a sector suffering from its worst ever slump.
The government expects the move to fend off the industry's dominant players, Samsung Electronics and Hynix Semiconductor of South Korea.
Following are answers to key questions about the market for DRAM or dynamic random access memory:
What does this mean for the global industry?
The consolidation led by Taiwan will leave the $25 billion sector with four major DRAM makers globally -- Samsung, Hynix, "Taiwan Memory Co" and one other company that would be left out of the Taiwan consolidation (either Micron or Elpida).
The reshaped landscape might help Taiwanese suppliers -- which make nearly a quarter of all the world's DRAM memory chips -- to get a stronger grip on output, especially after companies recklessly built up output in the last many years. Elpida may need funds before the Taiwan plan can be implemented.
What is the outlook for Taiwanese chipmakers?
There's likely to be no impact in the short term because it will take about six months to set up the new company, while chipmakers, including ProMOS and Powerchip are still strapped for funds.
The government did not give any specifics on how the new company can bring local DRAM makers together, but any de-listing of a company in such a consolidation could face opposition from shareholders.
In the long term, some analysts say this move might force some of the debt-ridden chipmakers to consolidate their capacity into the new company. Taiwan Memory Co could become a centralised foundry and DRAM makers would diversify into sales and marketing.
The six chipmakers to be involved in the plan are: Powerchip, Nanya Technology, ProMOS, Inotera Memories -- joint venture between Nanya and Micron -- and Rexchip, unlisted joint venture between Powerchip and Elpida.
Is this a chance or threat for Samsung, Hynix?
Benefiting from more advanced production technologies, Korean makers such as Samsung and Hynix could further tighten their grip on the industry, while Taiwan Memory struggles to slowly integrate several companies and technologies into one entity.
Taiwan Memory could end up becoming a formidable threat to No. 2 Hynix, which may have to seek more funding for technology investments. Still, analysts say whether Taiwan's government can inject more funds into Taiwan Memory remains a question.
What is the outlook for DRAM prices?
Even after the government's move, any significant recovery in memory chip prices is unlikely in the short term. So far this year, memory chip prices have been flat but slumped about 50 per cent in the fourth quarter of last year as a global economic slowdown hurt spending on personal computers and other gadgets that use memory chips to store data.
Analysts' forecasts for global PC shipments in 2009 vary, but many expect sales to fall. Research firm IDC expects PC shipments to drop 4.5 per cent this year.
Agencies
Wednesday, March 11, 2009
Has Wipro set up new consulting R&D arm?
Technology major Wipro is planning a deep plunge into the global consulting market with the idea of competing with true-blue global consulting brands and IT consulting firms.
In preparation for this move, the company has carried out an in-depth study on select consulting majors including Ernst & Young, PriceWaterhouse Coopers, McKinsey and Bain & Company to understand what made them stay different in the consulting world.
Anurag Srivastava, head of Wipro Consulting Services (WCS) said, "The objective of the study was to gather a holistic understanding of the consulting business. We want to create differentiation in the global markets through innovation-driven consulting. Consulting will be the front-end service for most of our large business deals.''
Wipro has also set up a dedicated research and development arm, Global Research Centre, to support its initiatives in the consulting space. The R&D facility will seek to enhance the business value to clients through innovation. The company believes that consulting will work as a powerful tool during times of recession to gain customer confidence.
Wipro employs over 1,200 consulting professionals and 7% of them will now be part of the R&D team. The team will track 12 industry verticals. The research activity starts with profiling the customer, moves on to analysing industrial trends, followed by providing a macro-economic snapshot and culminating in a viable business strategy.
The job of the R&D team is to lay seeds of innovation. It will play a key role in bridging the divide between ideators and front-end workers.
"The researchers will work in tandem with consulting professionals, so that customers are increasingly benefited,'' Srivastava said. "Consulting will have a significant impact on our IT/BPO revenues. It will transform us from an outsourcing player to a transformational partner."
Agencies
In preparation for this move, the company has carried out an in-depth study on select consulting majors including Ernst & Young, PriceWaterhouse Coopers, McKinsey and Bain & Company to understand what made them stay different in the consulting world.
Anurag Srivastava, head of Wipro Consulting Services (WCS) said, "The objective of the study was to gather a holistic understanding of the consulting business. We want to create differentiation in the global markets through innovation-driven consulting. Consulting will be the front-end service for most of our large business deals.''
Wipro has also set up a dedicated research and development arm, Global Research Centre, to support its initiatives in the consulting space. The R&D facility will seek to enhance the business value to clients through innovation. The company believes that consulting will work as a powerful tool during times of recession to gain customer confidence.
Wipro employs over 1,200 consulting professionals and 7% of them will now be part of the R&D team. The team will track 12 industry verticals. The research activity starts with profiling the customer, moves on to analysing industrial trends, followed by providing a macro-economic snapshot and culminating in a viable business strategy.
The job of the R&D team is to lay seeds of innovation. It will play a key role in bridging the divide between ideators and front-end workers.
"The researchers will work in tandem with consulting professionals, so that customers are increasingly benefited,'' Srivastava said. "Consulting will have a significant impact on our IT/BPO revenues. It will transform us from an outsourcing player to a transformational partner."
Agencies
Tuesday, March 10, 2009
Has IBM resorted to scattered layoffs globally?
Technology giant IBM is resorting to "scattered layoffs" and the total could be nearly 4,600 employees in North America even though the company has reported surprisingly strong quarterly profits in January, a media report says.
"Big companies also routinely carry out scattered layoffs that are small enough to stay under the radar... and IBM is one such company," the New York Times said.
Interestingly, after reporting strong quarterly profits in January, its Chief Executive Samuel J Palmisano in an e-mail message to employees said that while other companies were reducing jobs, his company would not. "Most importantly, we will invest in our people," he wrote.
But the next day, the New York Times said "more than 1,400 employees in IBM's sales and distribution division in the United States and Canada were told their jobs would be eliminated in a month. More cuts followed, and overall, IBM has told about 4,600 North American employees in recent weeks that their jobs are vanishing."
Quoting J Randall MacDonald, IBM's senior vice-president for human resources, the newspaper said "it was routine for the company to lay off some employees while hiring elsewhere".
IBM says it remains the largest high-tech employer in the US, with 1,15,000 workers. But IBM's American employment has declined steadily, down to 29 per cent of its worldwide payroll of 3,98,445 at the end of 2008.
However, experts have a different take on this. According to them, these unannounced cuts raise issues of disclosure and the treatment of workers.
The report cited Harley Shaiken, a labour economist at the University of California, Berkeley, as saying that "the issue becomes all the more pressing in this downward economic spiral."
Meanwhile, as part of a government filing last week, IBM said its workforce in Brazil, Russia, India and China had climbed to 1,13,000. These are markets with faster growth than the United States, and less expensive skilled labour.
"At IBM, the layoffs are coming swiftly, if with less disclosure. The estimate of 4,600 job cuts comes from adding up the itemised headcounts in information packages given to employees in each of the businesses," the report said.
NYT further added, "In its financial statements, IBM does report the cost of severance payments and outplacement counselling for layoffs about USD 400 million annually in the last five years but not head counts."
Meanwhile, IBM workers whose jobs are being eliminated have said the undisclosed cuts, and the timing, seemed to contradict the company's public statements.
Agencies
"Big companies also routinely carry out scattered layoffs that are small enough to stay under the radar... and IBM is one such company," the New York Times said.
Interestingly, after reporting strong quarterly profits in January, its Chief Executive Samuel J Palmisano in an e-mail message to employees said that while other companies were reducing jobs, his company would not. "Most importantly, we will invest in our people," he wrote.
But the next day, the New York Times said "more than 1,400 employees in IBM's sales and distribution division in the United States and Canada were told their jobs would be eliminated in a month. More cuts followed, and overall, IBM has told about 4,600 North American employees in recent weeks that their jobs are vanishing."
Quoting J Randall MacDonald, IBM's senior vice-president for human resources, the newspaper said "it was routine for the company to lay off some employees while hiring elsewhere".
IBM says it remains the largest high-tech employer in the US, with 1,15,000 workers. But IBM's American employment has declined steadily, down to 29 per cent of its worldwide payroll of 3,98,445 at the end of 2008.
However, experts have a different take on this. According to them, these unannounced cuts raise issues of disclosure and the treatment of workers.
The report cited Harley Shaiken, a labour economist at the University of California, Berkeley, as saying that "the issue becomes all the more pressing in this downward economic spiral."
Meanwhile, as part of a government filing last week, IBM said its workforce in Brazil, Russia, India and China had climbed to 1,13,000. These are markets with faster growth than the United States, and less expensive skilled labour.
"At IBM, the layoffs are coming swiftly, if with less disclosure. The estimate of 4,600 job cuts comes from adding up the itemised headcounts in information packages given to employees in each of the businesses," the report said.
NYT further added, "In its financial statements, IBM does report the cost of severance payments and outplacement counselling for layoffs about USD 400 million annually in the last five years but not head counts."
Meanwhile, IBM workers whose jobs are being eliminated have said the undisclosed cuts, and the timing, seemed to contradict the company's public statements.
Agencies
Infosys to hire 20,000 engineering graduates at over 8% higher salary
India’s second-largest software company Infosys will be inducting almost 20,000 engineering graduates this year at over 8.3 % higher salary from what was offered last year, even as the company seeks to cope with a lower demand for software services in its top export markets such as the US and Europe.
At a time when other industry rivals such as TCS, Wipro and HCL Technologies are deferring the
joining dates for new hires, Infosys is holding on to its commitment and that too at better salary levels than last year.
“We have increased the pay package from Rs 3 lakh per annum to over Rs 3.25 lakh per annum for those joining in June this year,” Nandita Gurjar, senior vice-president and global human resources head, Infosys, told ET in an interview. “The idea is to get the best talent even during this slowdown, to provide better training and prepare them for the projects,” she added.
Experts such as Prashant Srivastava, managing partner of Gallup Consulting, said that top tech firms want to retain their edge as preferred employers in the industry. “Proactive companies are preparing and hiring high performers for the future, as they don’t want to run after talent once economy revives in few years,” he said.
The offer letters and dates of joining have been sent to 20,000 freshers (2008-09), and the process of joining will start from June this year. Last year, Infosys recruited almost 18,000 (2007-08) engineering graduates.
The company has also increased the training period for new recruits from the current four months to almost eight months. “It gives them better understanding of a project because the predictability of what kind of work you will get is much lower than what it was last year,” said Ms Gurjar. Infosys visits some 1,100 engineering colleges every year.
At a time when the US government is mulling stricter work permit regulations, Indian tech firms such as Infosys will need to deliver more projects from India. “We have been preparing from past three years to reduce our dependency on H1B visa, which is hiring more and more locals in all the countries, where we work,” said Ms Gurjar.
Agencies
At a time when other industry rivals such as TCS, Wipro and HCL Technologies are deferring the
joining dates for new hires, Infosys is holding on to its commitment and that too at better salary levels than last year.
“We have increased the pay package from Rs 3 lakh per annum to over Rs 3.25 lakh per annum for those joining in June this year,” Nandita Gurjar, senior vice-president and global human resources head, Infosys, told ET in an interview. “The idea is to get the best talent even during this slowdown, to provide better training and prepare them for the projects,” she added.
Experts such as Prashant Srivastava, managing partner of Gallup Consulting, said that top tech firms want to retain their edge as preferred employers in the industry. “Proactive companies are preparing and hiring high performers for the future, as they don’t want to run after talent once economy revives in few years,” he said.
The offer letters and dates of joining have been sent to 20,000 freshers (2008-09), and the process of joining will start from June this year. Last year, Infosys recruited almost 18,000 (2007-08) engineering graduates.
The company has also increased the training period for new recruits from the current four months to almost eight months. “It gives them better understanding of a project because the predictability of what kind of work you will get is much lower than what it was last year,” said Ms Gurjar. Infosys visits some 1,100 engineering colleges every year.
At a time when the US government is mulling stricter work permit regulations, Indian tech firms such as Infosys will need to deliver more projects from India. “We have been preparing from past three years to reduce our dependency on H1B visa, which is hiring more and more locals in all the countries, where we work,” said Ms Gurjar.
Agencies
StanChart to hire 2,000 professionals in 2009, says Official
Global Banking giant, Standard Chartered on Sunday said it has no plans to freeze hiring in India despite the challenging market conditions and would recruit around 2,000 professionals this year.
StanChart had recruited 4,000 people in the last calendar year but has decided to scale down fresh recruitments in the face of financial downturn that has hit its operations globally, StanChart Human Resources Regional Head Madhavi Lall told the media here.
"We have not stopped hiring. Although, the number of new recruits may be lower in 2009 as compared to last year, the bank plans to recruit 1,500-2,000 people in the current calendar year," Lall said.
The lender already recruited 110 people in the last two months while it plans to hire 28 more people by July to strengthen its various business divisions, Lall said.
"These 28 people will be joining us from IIMs. The bank will go ahead with its hiring plans in the months ahead, which will include campus recruitments," Lall said.
Presently, StanChart has a staff strength of 19,000 in India as against its global headcount of 75,000, Lall said.
Out of 19,000 total employees, around 6,500 people operate in StanChart's retail banking division.
Agencies
StanChart had recruited 4,000 people in the last calendar year but has decided to scale down fresh recruitments in the face of financial downturn that has hit its operations globally, StanChart Human Resources Regional Head Madhavi Lall told the media here.
"We have not stopped hiring. Although, the number of new recruits may be lower in 2009 as compared to last year, the bank plans to recruit 1,500-2,000 people in the current calendar year," Lall said.
The lender already recruited 110 people in the last two months while it plans to hire 28 more people by July to strengthen its various business divisions, Lall said.
"These 28 people will be joining us from IIMs. The bank will go ahead with its hiring plans in the months ahead, which will include campus recruitments," Lall said.
Presently, StanChart has a staff strength of 19,000 in India as against its global headcount of 75,000, Lall said.
Out of 19,000 total employees, around 6,500 people operate in StanChart's retail banking division.
Agencies
Monday, March 9, 2009
Has TCS extended working hours?
Tata Consultancy Services (TCS) has increased its working hours to 45 hours per week from 40 hours effective April 1. This effectively means that employees will have to put in an hour more every day.
The biggest software exporter has also decided to fire around 1,300 employees or 1 per cent of its global workforce this year. This roughly works around one percent of its global workforce.
These employees failed to meet performance standards, according to a company spokesperson said.
About 100 employees have already been sacked in Chennai alone in the last two weeks, sources in TCS told the media.
This comes in the wake of recent announcements by the company’s MD S Ramadorai 10 days back that variable pay of employees is being reviewed this year, to counter the tough economic situations across the globe.
The IT major has also increased working hours to 45 hours per week from 40 hours effective April 1. The TCS sources said in the last two weeks alone the company has sacked about 100 people after they were found wanting in their performance appraisal.
Agencies
The biggest software exporter has also decided to fire around 1,300 employees or 1 per cent of its global workforce this year. This roughly works around one percent of its global workforce.
These employees failed to meet performance standards, according to a company spokesperson said.
About 100 employees have already been sacked in Chennai alone in the last two weeks, sources in TCS told the media.
This comes in the wake of recent announcements by the company’s MD S Ramadorai 10 days back that variable pay of employees is being reviewed this year, to counter the tough economic situations across the globe.
The IT major has also increased working hours to 45 hours per week from 40 hours effective April 1. The TCS sources said in the last two weeks alone the company has sacked about 100 people after they were found wanting in their performance appraisal.
Agencies
India next to US in anti-dumping measures, says World Bank
With protectionism emerging as a major threat to the global trade flow, data compiled by World Bank shows that India is next only to the US in terms of new anti-dumping measures imposed by their respective governments.
Besides, the number of such measures increased substantially in the second half of 2008 in both countries, World Bank has said in its background paper for the G20 Finance Ministers and Central Bank Governors Meeting later this week in the UK.
The US imposed over 20 new anti-dumping measures during the July-December period in 2008, followed by 15 such measures by the Indian authorities.
As per the data compiled by the multilateral lending agency, India took more than 10 fresh anti-dumping measures in the first half of 2008 -- higher than any other country during that period -- while the US imposed less than five such measures.
Other countries where new anti-dumping measures are on the rise include Brazil and Canada, while European Union, South Korea and Egypt saw the number of such initiatives declining in the second half of 2008.
Agencies
Besides, the number of such measures increased substantially in the second half of 2008 in both countries, World Bank has said in its background paper for the G20 Finance Ministers and Central Bank Governors Meeting later this week in the UK.
The US imposed over 20 new anti-dumping measures during the July-December period in 2008, followed by 15 such measures by the Indian authorities.
As per the data compiled by the multilateral lending agency, India took more than 10 fresh anti-dumping measures in the first half of 2008 -- higher than any other country during that period -- while the US imposed less than five such measures.
Other countries where new anti-dumping measures are on the rise include Brazil and Canada, while European Union, South Korea and Egypt saw the number of such initiatives declining in the second half of 2008.
Agencies
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