MaSSSoftech

A better operating performance and favourable currency movements help fetch the tech major better margins.
Infosys posted a 50 basis points increase in operating margins in the September 2009 quarter to 34.6 per cent, surprising the Street which had pencilled in a drop in margins, anticipating higher investments in sales and marketing. A better utilisation rate, up 300 basis points, together with a more favourable offshore:onsite ratio helped push up margins.

The Infosys management, however, remains cautious on margins, indicating it’s possible the 8 per cent increase in wages and salaries for offshore employees and the 2 per cent hike for onsite employees could hurt margins by about 200 basis points over the next couple of quarters. That is, however, not something to be concerned about, because with volumes recovering — up 2.3 per cent sequentially — compared with a fall in the June 2009 quarter, the outlook for the top tier technology firms now appears distinctly brighter.

Better volumes and favourable currency movements helped Infosys post an increase in dollar revenues of just under 3 per cent in the September 2009 quarter. Pricing, which came off by about one per cent, is still a bit of a concern, with the management indicating an upside could be some time away though right now pricing was stable. Nevertheless, the fact that Information Technology (IT) budgets aren’t coming off and are either flat or seeing a slight increase, has perhaps prompted the Infosys management to up its revenue guidance for 2009-10 by about 3 per cent to between $4.6-4.62 billion.

Even if budgets aren’t upped, it’s possible, say industry watchers, that Indian IT firms will gain as customers consolidate vendors. The good news is that the BFSI vertical, to which the bigger IT firms have a fairly large exposure, seems to have seen off the worst. Moreover, there’s traction in some other spaces, like telecom.

That was evident in the fact that Infosys managed to add 35 new clients during the quarter; at the same time the firm was also able to mine its top clients better. At Rs 2,178, the stock trades at 18.8 times estimated 2010-11 earnings and unless the rupee strengthens significantly or is very volatile, does hold at least a 15 per cent upside from current levels.

SAN FRANCISCO, October 10 (AFP) – Information technology (IT) will generate 5.8 million new jobs in the coming four years, according to research released Sunday by International Data Corporation, or IDC.

IDC predicts that the IT industry will help economies out of economic doldrums, creating more that 75,000 new businesses in the next four years and adding jobs at a rate of 3% annually.

"Countries that foster innovation and invest in infrastructure, education and skills development for their citizens will have a major competitive advantage in the global marketplace," said Microsoft Corp. (MSFT) chief executive Steve Ballmer.

"In this fundamental economic reset, innovative technologies will play a vital role in driving productivity gains and enabling the creation of new local businesses and highly skilled jobs that fuel economic recovery and support sustainable economic growth."

US software giant Microsoft sponsored the IDC research into the impact of IT in 52 countries that represent 98% of the global IT-spending.

"IT spending growth is a good sign as we come out of the recession," Microsoft Corporate Affairs communications manager Scott Selby said.

Employment growth in IT related jobs will be three times that of overall job growth in what Selby said is a "good driver of economic growth."

While the world has been in the grip of a recession, it has also been in the midst of a "technology renaissance," flush with advances in software, devices, and Internet-based services, according to IDC.

IDC expects IT spending in the countries studied to grow at slightly more than 3% annually, three times as fast as gross domestic product between now and 2013.

In good news for Microsoft, spending on software is predicted to grow faster than overall IT spending, rising 4.8% annually.

"Software is a driving force behind this IT growth," Selby said. "IT allows us to do more with less."

New technologies are also ushering in a new "cloud computing" paradigm, in which applications are provided online as services instead of as software bought and installed on home or office machines, according to IDC.

Money saved by using software as needed "in the cloud" instead of buying, maintaining, and updating applications will likely be devoted to bringing new products or services to market faster and cheaper, according to Selby.

IDC estimates that cloud services could add $800 billion in net new business revenues between the end of 2009 and the end of 2013.

"Over the past 20 years, we've seen transformative power in how investments in IT innovations foster economic growth," said Robert D. Atkinson, founder of the Information Technology and Innovation Foundation in Washington, D.C.

"Continued innovation and investment in information technology will help jump-start recovery from the current recession and will significantly contribute to the growth of employment and new businesses."

More than half of US companies do not allow employees to visit social networks such as Facebook, MySpace or Twitter while at work, according to a new survey.

Fifty-four percent of the chief information officers (CIOs) for 1,400 companies surveyed across the United States said workers were "prohibited completely" from visiting social networks while on the job.

Nineteen percent said employees were allowed to visit social networks "for business purposes only" while 16 percent said they allowed "limited personal use."

Ten percent of those surveyed said there were no restrictions on visiting social networks at work.

The survey of 1,400 companies with at least 100 employees was released this week and was conducted by an independent research firm for Robert Half Technology, a California-based provider of information technology professionals. It has a margin of error of plus or minus 2.6 percent.

Dave Willmer, executive director of Robert Half Technology, said "using social networking sites may divert employees' attention away from more pressing priorities, so it's understandable that some companies limit access.

"For some professions, however, these sites can be leveraged as effective business tools, which may be why about one in five companies allows their use for work-related purposes," he said.

Information technology (IT) bellwether Infosys Technologies announced its results for the second quarter of fiscal year 2009-10.

As is the practice, the company beat its target (guidance) it had set during the first quarter results on almost all counts. Known to be a conservative company, Infosys likes to set a lower guidance and beat it than set out a high target and not achieve it.

The company’s quarterly revenue stood at Rs 5,585 crore, up 2% from the previous quarter while it recorded net profit of Rs 1,540, up 0.85% in Q1.

The company also raised its full-year revenue and earnings per share (EPS) guidance.

Management speaks

After declaring the results, the Infosys top management comprising of CEO S Gopalakrishnan, COO SD Shibulal, CFO V Balakrishnan and Director – HR Mohandas Pai, among others, spoke to CNBC-TV18 in an exclusive interview on the company’s business and whether the slowdown in the IT sector was behind it.

“Customers are starting spend more money,” the Infosys management said, but added, “However, we continue to remain cautious on business.” A key challenge for the company ahead would be the volatility of rupee, it said. “The government must manage rupee volatility better.”

Infosys good numbers were a combination of better business and also internal factors, the management said. “We added 35 new clients in the second quarter and revenues from the top-10 clients were up 6%,” it said.

Infosys, which had recently hiked payscales of staff, also said the higher wages would impact the company’s margins by 200 basis points (2%).

It added that even as pricing had become stable and clients were not asking for renegotiations, an upside to pricing was still some time away.

On business ahead, it said: “FY11 [client] budgets are likely to be flat to marginally higher.”

Large corporate offices make a habit of blocking certain Web sites -- particularly personal e-mail, video sharing, and social networking sites. But, according to a recent survey compiled by Robert Half Technology, it appears that smaller businesses are locking out employees, too.

The survey of 1,400 Chief Information Officers (CIOs) from across the U.S. found that 54-percent of companies completely block access to social networking sites, while 19-percent block their use outside of "business purposes." Dave Willmer, executive director of Robert Half Technology, noted in a press release, "Using social networking sites may divert employees' attention away from more pressing priorities." Given the recent rash of people being fired over Facebook and Twitter, we imagine such policies might also serve to protect employees from themselves.

Still, despite corporate America's insistence on blocking access to many of these sites, some studies have shown that having access to Twitter, MySpace, Facebook, and even YouTube can make workers more productive. Having access to such services can provide a much needed break during the day and can alleviate the stress of being disconnected from friends and family while sitting in your cubicle. Besides, people will inevitably find a way around such restrictions.

There was one disturbing stat from the survey; one-percent of CIOs who responded didn't know their companies' policies regarding social networking sites. This leads us to believe that one-percent got their jobs purely through cronyism and nepotism. One of the responsibilities of a Chief Information Officer (the head of information technology) is to know the company's policy regarding, well, technology. And that does include social networking. [From: Robert Half Technology, via Huffington Post]

A bipartisan group of lawmakers supports legislation that would establish a database of economic bailout information to track, monitor and manage the $700 billion in Troubled Asset Relief Program funds.

We applaud the efforts of Rep. Carolyn Maloney (D-N.Y.) for sponsoring H.R. 1242 and Sen. Mark Warner (D-Va.) for introducing a companion bill in the Senate, S. 910. In addition, we would like to thank Chairman Dennis Moore (D-Kan.) and ranking member Judy Biggert (R-Ill.) for their leadership in holding a hearing recently in the House Financial Services Subcommittee on Oversight and Investigations. The hearing, titled “Utilizing Technology to Improve TARP and Financial Oversight,” shed light on the importance of data and data analytics.

H.R. 1242 would require the Treasury Department to deliver continuous, real-time updates on the status of bailout funds in a centralized database to provide true transparency. Such detailed reporting could support TARP and allow data analysts and government specialists to instantly detect possible systemic risk, waste, fraud and abuse in the future — using software alert notifications and predictive analytics for preventing potential economic disaster.

Currently, information regarding TARP funds has been spread across 25 federal agencies that are using incompatible formats and isolated databases. This makes it very difficult for government officials or taxpayers to gain an understanding of how TARP funds are being used and allocated. The technology proposed in H.R. 1242 would provide powerful new visibility that would benefit everyone — Congress and taxpayers alike.

True transparency and accountability require the integration of frequently-updated information from multiple sources into one centralized, immediately accessible database. This type of technology is what the best companies in every industry have been embracing for years. We call it business intelligence. Such a system would deliver timely, relevant and valuable insight to the financial oversight process, allowing regulators to head off potential problems before they become big enough to threaten the system.

Gathering, integrating and centralizing the right information and making sense of it is certainly a top priority. Intelligence begins with the integrity of information in the database. Financial oversight of the scope and depth required depends on a realistic grasp of the big picture — supported by enough detail to bring attention to potential issues. This requirement would be met with the deployment of an enterprise data warehouse, which would track all data movement to and from banks and the extended TARP network while providing continuous updates to the approved users.

We encourage Congress to pass legislation and establish a database that represents the very best of today’s information technology. True transparency for effective financial oversight depends on it.

ANN ARBOR, Mich., Sept. 22 /PRNewswire/ -- Ann Arbor-based ProQuest has ranked 27th on the 2009 InformationWeek 500, an annual listing of the nation's most innovative users of business technology. ProQuest, best known for its creation of information and technology tools that support research, is the top-ranked Michigan-based company and even placed higher than distinguished technology giants. InformationWeek is a premier source of news and analysis of leading-edge products and vendors in the business IT industry. Its InformationWeek 500 list is considered unique among industry rankings for its spotlight on the power of innovation in information technology.

"It's an honor to be named to this prestigious roster of information technology innovators," said ProQuest Chief Information Officer Bipin Patel. "Our customers and our employees have long considered ProQuest a leader in end user-driven information technology innovations. It's gratifying to have those opinions confirmed by a respected team of industry analysts."

ProQuest was recognized by InformationWeek for its establishment of a research and development team, which continually monitors new technologies and tests their applicability for researchers, librarians and end-users. The team collaborates with a variety of market segments to identify new ideas. An R&D lab provides freedom for team members to generate and test prototypes internally and externally. ProQuest's innovation efforts are focused on investigating new ways in which its products can improve the quality of research, both in experience and the breakthroughs it generates.

"For over 20 years, the InformationWeek 500 has honored the most innovative users of business technology," said InformationWeek Editor-in-Chief Rob Preston. "Year after year, InformationWeek 500 companies harness technology to improve efficiency, boost productivity, drive revenue, and establish a competitive advantage. We applaud this year's winners, and the CIOs and other executives whose ingenuity and risk taking are at the center of business technology innovation."

InformationWeek identifies and honors the nation's most innovative users of information technology with its annual 500 listing, now in its 21st year, and also tracks the technology, strategies, investments and administrative practices of America's best-known companies.

Additional details on the InformationWeek 500 can be found online at www.informationweek.com/iw500/.

About ProQuest

ProQuest creates specialized information resources and technologies that propel successful research, discovery, and lifelong learning. A global leader in serving libraries of all types, ProQuest offers the expertise of such respected brands as Chadwyck-Healey(TM), UMI(R), SIRS(R), and eLibrary(R). With Serials Solutions(R), Ulrich's(TM), RefWorks(R), COS(TM), Dialog(R) and now Bowker(R) part of the ProQuest brand family, the company supports the breadth of the information community with innovative discovery solutions that power the business of books and the best in research experience.

More than a content provider or aggregator, ProQuest is an information partner, creating indispensable research solutions that connect people and information. Through innovative, user-centered discovery technology, ProQuest offers billions of pages of global content that includes historical newspapers, dissertations, and uniquely relevant resources for researchers of any age and sophistication--including content not likely to be digitized by others. Inspired by its customers and their end users, ProQuest is working toward a future that blends information accessibility with community to further enhance learning and encourage lifelong enrichment.

For more information, visit www.proquest.com or the ProQuest parent company website, www.cambridgeinformationgroup.com.

About InformationWeek Business Technology Network

The InformationWeek Business Technology Network provides IT executives with unique analysis and tools that parallel their work flow - from the defining and framing of objectives through to the evaluation and recommendation of solutions. Anchored by InformationWeek, the multimedia powerhouse that looks across the enterprise, the network scales across the most critical technology categories with online properties like DarkReading.com (security), IntelligentEnterprise.com (application architecture), Network Computing (networking and communications) and PlugintotheCloud.com (cloud computing). The network also provides focused content for key IT targets such as CIOs, developers and SMBs with Dr. Dobb's InformationWeek Global CIO and bMighty.com, as well as vital vertical industries with InformationWeek Financial Services, Government and Healthcare. With content at the nucleus of our information distribution strategy, IT professionals turn to our network of expert voices, research and communities to stay informed, get advice, and research technologies to make strategic business decisions. (http://www.informationweek.com/)