In this issue: Low-cost laptops; Wi-Fi on campus; Africa eyes outsourcing; Execs on globalization; Software piracy on the rise; and CIOs and social responsibility.
By Steff Gelston
Microsoft Looks Beyond Low-Cost Laptops
Microsoft is looking beyond ultra-low-cost laptops to cheaper alternatives such as
smartphones and shared computing in the drive to give people in developing nations a way
to communicate and access the Internet.
The world’s largest software maker has a few projects in the making, including a push to
use mobile phones in computing and microfinance. Mobile phones have had an impact in the
developing world, enabling people such as farmers and fishermen to find better markets
and prices. Handsets give a person a way to be reached for jobs.
“Technologies like the mobile phone promise to take things like very small loans,
microfinance, and allow them to operate in a very efficient infrastructure so that the
price and the availability of financial products can be far broader,” said Microsoft
chairman Bill Gates at the Jakarta Convention Center last month.
One reason companies are looking more to mobile phones for developing nations is because
of the huge number of handset users worldwide, estimated at 3 billion, and because mobile
phone network coverage is widespread. Nearly 90 percent of the global population is
covered by a mobile phone network, according to the GSM Association and CDMA Development
Microsoft is also looking at ways to hook up smartphones to TVs to use the computing
power and connectivity of the handset with the television’s larger screen for a better
and cheaper Internet experience in the developing world. It began working on Fone+ a few
years ago and has tested prototypes, proving that such devices can lower the cost of
computing for the poor.
Ultra-low-cost laptop PCs (ULCPCs) do have an important role to play in providing Web
access to developing countries, but such devices are still expensive, according to Craig
Mundie, Microsoft’s chief research and strategy officer, and the head of its Unlimited
Potential Group, which works on projects for the poor. That’s why it is working on Fone+
and MultiPoint, a technology in which each student has his or her own mouse and unique
cursor to use the same computer. That drops the price of computing dramatically, to one
PC, a projector and 30 computer mice per classroom, instead of $200 per laptop.
Using ULCPCs to bring computing to students in developing countries began with the $188
XO notebook from the One Laptop Per Child Foundation (OLPC). The XO originally started
with an open-source OS, but OLPC has worked with Microsoft on using XP, and Microsoft has
dropped the price of a suite of Office software for such devices.
Microsoft and other organizations are concerned with bringing computing to the developing
world. The fear is that modern countries with access to IT and the Internet will continue
to expand the gap in technological know-how over developing nations.
Colleges to Speed Adoption of Next-Gen Wi-Fi
Though 802.11n is in its infancy and there’s still no associated official wireless
standard, 99 percent of all North American universities will be using it by 2013,
according to a report by ABI Research. A proposed upgrade to today’s wireless networking
schemes such as 802.11b and 802.11g, the new standard promises far greater speed than its
Less than 3 percent of North American universities are using 802.11n but adoption will
grow rapidly during the next five years, ABI predicts. Wi-Fi usage in K-12 schools is
also expected to grow during that period, due to a need for enhanced security and the
fact that schools are instituting “anytime, anywhere” learning.
Europe is also starting to join in, according to ABI. However, Wi-Fi adoption there could
be hindered by lingering health concerns associated with the technology.
Regardless, global revenue from Wi-Fi access point and controller equipment in the
higher-education space will jump more than sixfold from $137 million in 2007 to $837
million in 2013, ABI says. “Wi-Fi access point and controller equipment revenue in the
global higher education space will skyrocket,” says Stan Schatt, ABI VP and research
And despite a common belief that the Wi-Fi industry in general is fueled by large
enterprise wireless deployments, a separate ABI report found that consumer and
small-business customers make up the vast majority of the marketplace for the technology.
In fact, 95 percent of all access point shipments last year were to consumer and small
enterprises, ABI says. Revenue from large enterprise purchases accounted for just 32
percent of all access point revenue in 2007.
Africa has outsourcing in its sights
Move over, India: Africa wants a piece of the IT outsourcing market. Egypt, Ghana,
Nigeria, Senegal and South Africa are becoming increasingly aggressive in their push to
compete with India—and the rest of the world—in outsourcing.
“There is an opportunity,” says Yankee Group analyst Mindy Blodgett. “India is going to
remain the offshore outsourcing leader probably forever, but you never know. That market
is in trouble because of attrition. Companies are plagued by it.”
Prices are also going up in India, which is a good thing for Africa. Many of its
countries also have a time-zone benefit when dealing with European customers.
Several African nations have attracted outsourcing business but to compete they need to
develop a larger, better-educated workforce. Problems with power grids,
telecommunications infrastructure, transport infrastructure and unstable governments also
must be addressed.
International capacity, a talent pool and a good environment for investments, with tax
incentives, favorable labor laws, and economic and political stability, sum up what
Orange Business Services looks for in a country. “Once you get that, the business will
come and the customers will come. The demand is much higher than the available
resources,” says Yasser Radwan, vice president, Customer Services and Operations, Orange,
There is reason for Egypt and other countries to be interested in IT and business process
outsourcing. “These are good jobs…they tend to pay well, and it lifts an economy,” says
Execs Put a Positive Spin on Globalization
Globalization is viewed by top executives at leading organizations around the world as a
business challenge that is here to stay, according to a study by EquaTerra and World 50
of 217 business leaders. Most say they view the trend as having a positive long-term
impact on their business.
Study: Software Piracy Still Growing
computers First, the good news: The use of pirated software dropped in 67 of 108
countries surveyed in a study by the Business Software Alliance, which represents
software vendors and their hardware partners and pursues companies that use pirated
Now, for the bad news: The software piracy rate increased by three percentage points to
38 percent in 2007 because the worldwide PC market grew fastest in high-piracy countries,
according to BSA. Countries such as Armenia (93 percent piracy rate), Bangladesh (92
percent) and Azerbaijan (92 percent) led the way in software pirating.
“We are making much-needed progress in the battle against PC software piracy, and that’s
good news for governments, end users, businesses and the industry,” says BSA President
and CEO Robert Holleyman. “The battleground is now shifting, however, to emerging
Several market factors contributed to a rise in piracy rates. First were the market
dynamics in the PC segment, where the fastest growth is in the consumer and
small-business arenas. “These are the hardest sectors in which to lower piracy,” the
report notes. Second was expanded Internet and broadband access in emerging markets.
Market research company IDC (a sister company to CIO’s publisher) conducted the study for
BSA, relying on proprietary statistics for software and hardware shipments gathered
through surveys of vendors, users and the software sales channels; it also enlisted IDC
analysts in more than 60 countries to review local market conditions.
In total, according to IDC’s estimate, dollar losses from piracy hit nearly $48 billion
in 2007, a 20 percent increase from 2006. That loss number has been controversial,
however. Some critics say BSA wrongly assumes that every illegal software copy sold would
have been purchased legally otherwise.
Social Responsibility on CIOs’ Agenda
Social responsibility isn’t just for CEOs anymore. As the CIO role continues to change
and expand into the business, some technology executives are also making it their mission
to transform how IT is viewed by and can benefit the community.
One CIO who is making a difference is Steve Scopellite, winner of the CIO of the Year
award from Computers for Youth (CFY), a nonprofit organization that provides computers
for low-income families. Scopellite, managing director and co-CIO of Goldman Sachs, is
committed to creating an environment that can sustain a diverse workforce at Goldman
Sachs; he also works with schools and other organizations to engage young people in
“We need to get technology in the hands of kids at an early age. And I don’t mean Game
Boys,” says Scopellite. His work mentoring and recruiting future IT workers is why he was
chosen as this year’s CFY winner.
Recruiting new talent for Goldman Sachs became Scopellite’s main focus after he realized
the company could do a better job of getting women and minorities more interested in
technology careers. “I visited schools, worked with our recruiters and vendors, and
together with our management team, we changed the process with some very positive
outcomes,” he says.
Scopellite is the sponsor for the Technology Black Network within Goldman Sachs, a
network that is part of its diversity strategy. He also helped establish the Career
Development Committee and the Diversity Committee for the Technology Division.
“Recognizing CIOs for being socially responsible sends an important signal about how
critical the role of CIO has become,” says Elisabeth Stock, CEO and cofounder of CFY.