Archive for April 2009
iRise Helps Enterprises “Test Drive” Business Applications Before Deployment
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by Leena Rao on April 30, 2009

iRise is a software company that lets companies “visualize” models and prototype business applications before they are built so businesses can test drive the software. The ability to visualize business applications before they are officially deployed (or a single line of code is written) lets enterprises test drive apps, then quickly and cost-efficiently correct any problems.

iRise says its software helps large companies cut at least 30% of their application development cost and deliver more successful systems twice as fast. iRise’s software is gaining popularity amongst Fortune 500 and big-name companies-UPS, The New York Times, Morgan Stanley, Delta Air Lines, and American Express all use the visualization software.

iRise can be used to visualize any software that has a user interface: new Web applications, portals, enhancements to existing systems, customizations to packaged implementations, as well as mobile applications. But the software isn’t cheap-its around $7000 per user, which to a small or mid-size business may be too much to spend on a software application, especially in the current economy.

by Leena Rao on April 29, 2009

Workday, a financial and human resources SaaS provider, has secured $75 million in Series E funding led by New Enterprise Associates (NEA) (which contributed $45 million) with existing investors Greylock Partners and Workday CEO and co-founder Dave Duffield also participating. Duffield founded PeopleSoft, which he sold to Oracle in January 2005 for $10.3 billion. The company has raised a total of $150 million in funding.

Workday, which currently has over 80 customers, plans to use the funds to extend its product portfolio and support the company’s expansion. Workday’s software, Workday Human Capital Management and Workday Financial Management, helps companies manage human resources and finances in a single system.

by Leena Rao on April 29, 2009

SugarCRM, a provider of commercial open source CRM software, has launched Sugar Express, a low-cost, on-demand CRM that runs on SugarCRM’s global on-demand computing platform – the Sugar Open Cloud.

Like Sugar CRM’s other products, Sugar Express delivers sales, marketing and support features, complete with Sugar Plug-Ins for Microsoft Office and access to SugarCRM Customer Support. Sugar Express is offered as an annual subscription at $499 for up to five users or $799 for up to ten users per year.

by Erick Schonfeld on April 28, 2009

TellMe, which Microsoft bought two years ago, is rolling out an upgrade to its call center automation software which should improve its speech recognition rates. It is also adding Global Crossing as partner for reselling its VoiP carrier service, along with AT&T and Verizon. TellMe handles 2.5 billion calls a year for customers such as American Airlines and ETrade, all on-demand. Even a one percent improvement in automated call completion rates translates into millions of dollars a year for large call centers.

TellMe will be deploying a new text-to-speech engine with an almost-sexy female voice called Zira. She only sounds slightly robotic. Another set of technologies can break up sentences into their constituent parts so that if the software doesn’t understand something it can ask for only the piece of missing information instead of repeating the entire question. or instance, if you say you want to fly from New york to San Francisco on Wednesday, and it got everything but the day, it would only ask you what day you want to fly instead of making you repeat your entire itinerary.

by Leena Rao on April 28, 2009

Zoho, the creators of a web-based software suite made up of document, project and invoicing management tools, has launched the availability of its comprehensive webtop productivity products on mobile devices.

Zoho previously had basic mobile support for its applications on iPhone and some limited capability on Windows Mobile but now fully integrates Zoho Applications with several mobile devices. Zoho Mail, Calendar, Writer, Sheet, Show & Creator are now available for the iPhone, Android, BlackBerry, WindowsMobile and Symbian devices.

As we’ve written in the past, Zoho is an innovative document management tool, and includes easy access thanks to support for Google and Yahoo IDs and the group sharing across different apps feature. While Zoho has added useful features to its software suite, Zoho is going to have to fight an uphill battle to keep consumers from going towards web-based applications offered by companies with a vast reach (Google, Microsoft, Adobe, etc.).

by Leena Rao on April 27, 2009

Marin Software, a startup that creates search engine optimization software for advertisers and agencies, has secured $13 million in Series C financing led by DAG Ventures, with Focus Ventures, Benchmark Capital and Amicus Capital participating. Marin received $7.25 million in Series B funding in 2008 led by Benchmark Capital. The company also received $2.5 million in Series A funding from Amicus Capital in 2006.

Marin Software offers a browser application to help advertisers and agencies managing paid search advertising campaigns across Google, Yahoo, MSN and other search sites. Marin’s software is used by Razorfish, ZipRealty and other companies. Marin’s customers spend at least $100,000 per month on paid search campaigns across the major search engines.The company’s main competitors include Kenshoo and Refined Labs.

Facebook drops other shoe tomorrow?
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by Steve Gillmor on April 26, 2009

The Wall Street Journal is reporting Facebook will open up most if not all of their user-contributed data to developers at a developer event tomorrow. This has been long expected and will likely trigger a wave of third-party integration of Facebook streams with other popular feeds, most notably that of Twitter.

Should players such as Seesmic Desktop and FriendFeed roll out an integrated service, we will be a major step closer to a single stream of realtime events. This in turn will rapidly accelerate a convergence around micromessaging similar to the one around email when it achieved a critical mass following AOL’s opening up of the limited educational and government mail systems to average users.

Already the emotional reaction to the possibility of a swine flu pandemic has pushed Facebook back into the spotlight as people contact their family and friends over the private/public channel. While trying to track down a friend I missed chatting with this weekend at a live performance, someone used Facebook chat to ask what I thought about a Flu Emergency preparation list he’d compiled. Events were moving so fast that he published it before I could respond, but the tools will prove superior to Twitter direct messages, which have been intermittent in recent days according to some reports.

While Twitter has tremendous advantages for newbies, the depth of Facebook and FriendFeed is more and more valuable as we rely on these networks for fail-over instant communications. FriendFeed’s realtime direct messages will likely be duplicated in short order by Facebook, and the opportunity for meshing Facebook and Twitter together will prove irresistible to the hot Twitter client market, what with Tweetie for the Mac synchronizing with its leading iPhone app.

The debate on the network is between Dave WIner, who sees a thousand Twitters, and Jason Calacanis who says Twitter is dialtone. Tomorrow’s announcement suggests something between those two views, with a single aggregated feed managed by two or more of the players in a distributed cross-licensing model. Twitter will continue to own the celebrity growth, but those who look to harness this realtime platform for business and personal networking will quickly adopt the more powerful tools now available at FriendFeed and coming online from Facebook and perhaps Google.

Cloudkick Now Lets You Migrate Your Amazon Machine Images To Slicehost
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by Leena Rao on April 24, 2009

Cloudkick, a Y Combinator startup that offers a free server management system to businesses whose web infrastructure is maintained by Amazon’s EC2 or Slicehost cloud-based servers, is unveiling a nifty feature today at Under the Radar. Cloudkick has added the ability for users to migrate their Amazon Machine Images (the template for servers on EC2) on their EC2 servers to another service provider, like Slicehost (which is owned by Amazon Web Services competitor Rackspace). This lets users who are tied to Amazon’s servers be able to easily switch to a less-expensive provider.

When we first reviewed Cloudkick, the company only managed the 350 servers of the 40 Y Combinator startups. Now, Cloudkick is managing 10,000 servers and increasing clients rapidly. Built off of Amazon Web Services’ API, Cloudkick gives users a single control panel where you can manage all of your servers (or instances) through various platforms.

Cloudkick provides detailed graphs on the health of your servers, and tools to categorize and keep information about what each server is doing. Cloudkick’s dashboard allows you to easily add or remove EC2 or Slicehost servers with a click and then monitor an unlimited amount of instances. You can see all the servers in one place, and color-code and label each server. Cloudkick will check whether servers are alive and functioning and then alert you, via email or voicemail, if servers go down. Cloudkick also provides data on bandwith and other metrics on servers in easy to use graphs and tables, allowing you a visual snapshot of server activity. You can also access servers straight from web and can run commands through your web browser remotely, which is handy when you are trying to manage servers from another computer

As we said in our earlier review of Cloudkick, Amazon offers a web-console along with their product but you cannot add servers from other cloud platform, you can’t tag or label servers, you can’t run commands on servers from the web and EC2 doesn’t offer graphing or monitoring features. Rightscale is another cloud management platform that offers similar services to Cloudkick but its a paid service.

Cloudkick is part of the birth of cross-cloud applications and management tools. As technology companies roll out their cloud platforms and businesses begin to become increasingly reliant on the cloud, these management tools will become even more useful, especially when the service is free and it lets you optimize your investment in the cloud by easily switching to a less expensive
provider. There’s is definitely positive results from deploying interoperability between cloud servers. Having more than one alternative cloud service will create competition between Amazon, Rackpsace and other server providers which will probably drive down costs for customers.

by Michael Arrington on April 24, 2009

Good Data, a startup founded in the Czech Republic and with headquarters in San Francisco, has closed a second round of financing – $2.5 million from Marc Andreessen, Ben Horowitz, OATV and General Catalyst. The company has now raised a total of around $4.5 million in capital.

You don’t see a lot of startups coming out of Eastern Europe, and even fewer who receive Silicon Valley capital. But founder Roman Stanek is an exception and a highly fundable individual. He sold his first startup, NetBeans, to Sun for $10 million and his second, Systinet, to Mercury Interactive/HP for $105 million. And like his previous startups, Stanek has perfected the running of a tech company with operations in both the U.S. and Prague.

Good Data is disrupting a highly lucrative multi-billion dollar market – data analytics. This is a sector dominated by huge software companies like IBM (via their Cognos acquisition), SAP (via Business Objects) and Oracle (via Hyperion). Companies pay hundreds of thousands of dollars for the software, plus large yearly maintenance fees. And now Good Data is offering a cloud based solution. For free.

AMD Ups The Ante In Competition With Intel; Unveils Powerful New Server Chips
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by Leena Rao on April 23, 2009

Advanced Micro Devices (AMD) announced yesterday that its delivering a six-core AMD Opteron micro-processor code named “Istanbul” in June, ahead of schedule, that promises up to 30 percent more performance than current Quad-Core AMD processors.

AMD also unveiled Direct Connect Architecture 2.0, which will accommodate up to 12 cores initially, with native virtualization performance and features to prioritize low-power consumption. AMD introduced another upcoming product, the AMD Opteron 4000 series, which is designed to address virtualized Web and cloud computing environments.

AMD says that these products reflect the customers’ drive towards performance and virtualization, causing the need for more cores and greater scalability of servers. Of course, these powerful new products represent AMD’s message to Intel that they are upping the ante to keep up with their main competitor. AMD has been struggling with sales in the enterprise space. Earlier this week, AMD reported significant losses in the first quarter of 2009, with as revenue falling 21% to $1.8 billion. The company lost $416 million, compared with $351 million in same quarter last year.

AMD has long been one step behind Intel-but this week, Intel’s position became even more clear. Earlier this week, VMware launched its virtualization software vSphere “cloud operating system” with Michael Dell, Cisco’s CEO John Chambers, EMC’s CEO Joe Tucci and Intel’s SVP Pat Gelsinger all collaborating in the event, symbolizing a powerful consortium of big-name IT companies that are supporting VMware’s virtualization products. Read more on TCIT’s analysis of VMware’s event and consortium here. VMware and Intel also announced a partnership to optimize the VMware Client Virtualization Platform (CVP) (a product that will be part of the VMware View suite of desktop virtualization products) to run on desktop and notebook client PCs utilizing Intel’s processors.

The Elephant in the Room
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by Steve Gillmor on April 22, 2009

elephantIt was flying CEOs all over the stage at VMware’s vSphere rollout Tuesday in Palo Alto. Though the first thing you see these days as you enter is the Cloud word emblazoned on the gateway sign, today’s event was more like “We’re all about the stuff that will make up the cloud real soon now.”

That’s not to say that VMware’s massive upgrade of its virtualization technologies is trivial or unimportant to keeping VMware ahead of Microsoft’s freeware attack. It’s just that calling it a Cloud OS or the foundation of a “private cloud” is the reason so many tech leaders danced on and off the stage.

The first to accept a glad hand from VMware boss Paul Maritz was Cisco counterpart John Chambers, followed closely by Intel SVP Pat Gelsinger, Michael Dell, and EMC CEO and VMware Chairman Joe Tucci. The message was consistent: virtualization can now handle anything that used to be thrown at Big Iron, from compute cycles to big network switches to storage. The cream of the Valley and server vendors from Dell to HP – well, you get the picture. Virtualization is ready to take on the big boys.

But as Maritz and CTO Stephen Herrod viscerally demonstrated in a series of odd flourishes to the huzzahs of the assembled VMware blue shirted multitudes on the lawn outside, just who the big boys are is in play. One demo used some Men in Black Secret Service poseurs charged with protecting the President’s Blackberry to show how resources could be taken offline without disrupting the flow of messages from Dick Cheney, current staffers, and even the White House dog.

Video showed an Olympic torch-like rushing past cheering blue shirts around the world, with a perhaps unintended message being VMware and its partners are middle relay runners with Big Cloud waiting for the handoff when their strategies mature. And of course there was the elephant in the room, a Sun Fire receiving a handwritten sign with IBM crossed out and Oracle added. For a group of industry captains celebrating a serious leap in the power of virtualization, the parochial atmosphere jarred.
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Perhaps it was the toppling of Sun in such swift order that sent a shiver up these tough guys’ spines. Talking after the event with the small companies who will build out these private clouds for customers, the sense was that VMware has extracted the best of what the Valley can offer and provided a rational bridge to the broader cloud future. But just as no questions were allowed at the Oracle/Sun analyst call the day before, a promised media conference with John Chambers was abruptly canceled, and Dell literally ran away from one reporter toward the parking lot.

by Erick Schonfeld on April 22, 2009

Regular search engines such as Google and Yahoo use statistics to make sense of the Web. They count links, keywords, and other items on a page to determine its rank in search results. Semantic search engines try to actually understand the meaning of the words found on the Web and other documents to bring back the most relevant results to a query. Microsoft bought Powerset for $100 million to gain semantic search expertise, but so far all it can search is Wikipedia.. Hakia, Textwise, and other startups are also working on semantic search. Now comes NetBase, which brings a slightly different approach that its says can scale to the entire Web.

NetBase has been around for a while. Originally called Accelovation, it has raised $9 million in two rounds of venture funding over the past four years, has 30 employees, and counts among its current customers P&G, Caterpillar, 3M, BP, Kraft, BASF, and Goodyear. It is now changing its name and offering its core semantic indexing technology as a platform for other companies to build their own products. Already, scientific publisher Elsevier uses NetBase to power its Illumin8 research tool for searching scientific articles, patents, and Websites.

by Leena Rao on April 22, 2009

LogLogic, a security and log management firm that helps companies sort though log data in their IT systems, has acquired security management company, Exaprotect, for an undisclosed amount. Exaprotect’s software monitors and manages companies’ IT security threats and breaches.

LogLogic, a Sequoia and SAP Ventures-backed private company, offers companies a suite of software products that helps IT departments make sense of logs of IT audits, compliance, and threats, other operational data. Customers can also build their own applications and workflow from LogLogic’s log management software. LogLogic has nearly 800 customers. LogLogic is hoping that this acquisition will help the company edge out competitors RSA, IBM and ArcSight for market share in the security management space.

Big Blue’s Profit Slips In First Quarter But Beats Estimates, Software Sales Soften The Blow
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by Leena Rao on April 20, 2009

IBM reported its first quarter 2009 earnings this afternoon, posting diluted earnings of $1.70 per share compared with diluted earnings of $1.64 per share in the first quarter of 2008, an increase of 4 percent. First-quarter net profit fell one percent to $2.30 billion from $2.32 billion in the first quarter of 2008. Total revenue for the first quarter decreased by 11 percent, to $21.7 billion from the first quarter of 2008. Analysts expected first quarter earnings of $1.66 a share on revenue of $22.5 billion.

IBM said that it expects to report 2009 earnings of at least $9.20 a share.

IBM CFO Mark Loughridge said that sales of the companies software and services helped IBM weather the economic environment. Hardware was hit harder, according to the company.

Revenue, which IBM says was impacted by currency performance and the declining economy, from all parts of the business decreased on the whole. Total Global Services revenues decreased 10 percent, Global Technology Services segment revenues decreased 10 percent, and Global Business Services segment revenues decreased 10 percent. Short-term business client contract signings decreased by 14 percent to $5.5 billion but longer-term signings increased 14 percent to $7.0 billion.

Revenues from the Software segment showed the least drop, decreasing by 6 percent to were $4.5 billion compared with the first quarter of 2008, revenues from IBM’s middleware products (WebSphere, Information Management, Tivoli, Lotus and Rational products), decreased by 5 percent to $3.6 billion, and revenue from operating systems decreased 7 percent to $492 million. Revenue from the Systems and Technology segment fell 23 percent to $3.2 million. Systems revenues decreased 22 percent.

IBM saw fast public sector contract growth, with a 200 percent increase in public sector contracts in the U.S. alone. The company saw a 50 percent increase in public sector contract signings worldwide

When asked about this morning’s news of Oracle’s acquisition of Sun Microsystems, Loughridge remained evasive and said the company is optimistic about their acquisition strategy in the coming year. IBM withdrew is $7 billion offer to buy Sun a few weeks ago, but it appeared that talks may were have been renewed between the two companies. Loughridge also said that the company will continue investment in initiatives like Cloud computing, which seems prime to drive growth.

by Erick Schonfeld on April 20, 2009

Larry Ellison has always wanted to be the Steve Jobs of the enterprise. With this morning’s announcement that Oracle will buy Sun Microsystems for $7.4 billion, he took a big step towards making Oracle more of a soup-to-nuts provider of enterprise technology. With Sun, he will now be able to build and package together everything from chips and servers to operating systems, Java middleware, databases, and enterprise applications.

Like Apple, Oracle wants to take away complexity for its customers and bundle the entire IT stack neatly together so that it works without hassles and is optimized for Oracle’s software. With this deal, Ellison has come full circle from his early-1990s mantra of “best-of-breed” systems, which he abandoned long ago. Rather than look like Apple with its dedication to making the perfect product, Oracle just became IBM. It will use Sun’s existing server market share to push Oracle databases and software, and bundle it all with IT services. Sure, it will continue to support Dell and HP and even rival enterprise software, but the sales pitch will be around the bundled product. If that turns out to be a superior product at a lower price, then both Oracle and customers will win out. But to the extent that it takes away choice from IT buyers, it could be an even tougher sell than convincing them to give up their beloved Blackberries for an iPhone.

by Leena Rao on April 20, 2009

BlueStripe Software, a company that sells application service management software, secured a $8 million in Series B funding from Valhalla Partners and Trinity Ventures. The company secured $5 million in Series A funding in 2007 from Trinity Ventures. BlueStripe says it will use the funding to expand business operations, create new products and further sales and marketing efforts.

Founded in 2007, BlueStripe helps enterprises stage, deploy, and manage business applications in the server environment. BlueStripe’s flagship product, FactFinder, gives businesses the intelligence to manage business‐critical applications during physical to virtual (P2V) conversions, new application roll-outs, and production deployments.

The Swarms of Silence
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by Steve Gillmor on April 19, 2009

tickerI like talking about Twitter. I have no problem with Oprah getting hip to Twitter. I have no problem with being left off the Suggested List. I have no problem with Twitter having dropped Track and slowed the micromessaging era until it became totally obvious that Twitter is a transcendent shift in the fabric of the network. All the rest is noise.

That’s because of people like the guys who are building out FriendFeed. There have been many such folks in the history of the network. Some have contributed ideas that routed around proprietary roadblocks. Some have used broad market force to mandate standards that led to impregnable empires built on economies of scale that in turn spawned disruptors of that hegemony. But today requires a combination of all these models, a blend of market power, independence, and crucially, the ability to work with your competitors in ways that allow both to grow.

FriendFeed appears to have the ability to sustain itself to the point where it can achieve its functional goals. Those goals, if its founders are to be believed, are to foster a suite of tools for managing the rich flow of metadata orbiting content objects on the information network. It’s not an open source project, but rather an open goal project. The bootstrap is in creating the synergies necessary to observe the results of realtime conversation and its output.

With the release of FriendFeed’s realtime tools and the imminent addition of Track (realtime search alerting) two weeks ago, the most observable result has been the monitoring of Twitter’s explosive growth in mainstream media. Although many of the former uber-followed tech stars have lost ground in relation to the bloated Hollywood effect of Twitter’s Suggested List and the gaming it incented, the rest of the rank and file have seen steady growth, ranging from one or two a day for newbies to 10 or 20 for more established technologists, journalists, and marketers.

FriendFeed realtime swarms around shows such as TWiT and FFundercats continue to expand, with downloads and streaming users growing aggressively as millions start participating in the Twitter information flow. While we don’t precisely know the pragmatic value or usage patterns of these swarms, we know enough to realize that learning by doing is a hedge against being passed by as the race for traction in the new media markets accelerates.

Although some see this as a battle of entrenched media versus the forces of transparency, the reality is much more nuanced. For one, the notion that gifts of attention should be taxed at some set value is unworkable. Did John Lennon receive unfair wealth because he was the Smart One, and was Paul McCartney disadvantaged because he was in Lennon’s shadow? Did The Beatles become colossal because Brian Epstein put them in suits and sucked up to the Queen? Did the Stones become great by pissing off the Queen? Popular culture has its own rules, its own operating system, its own arc of innovation, consolidation, and glorious decay.

For another, realtime has interesting characteristics that smooth out the hype curve on both ends. If people ignore the pressure of submitting to the realtime feedback loop, they lose authority rather than preserve it. Those that stand and engage in realtime are perceived as more transparent, more relaxed, less conflicted, and less scripted. JFK’s press conferences were the first realtime television events in the political process, and to this day they are electrifying to watch. Watching Dylan in a sea of lighters at Madison Square Garden intoning, “Even the President of the United States must stand naked…”

Once we get past the novelty of the realtime swarms around events, we begin to see the actual flow of realtime in the now, not about an event but the event itself. As the new comment folds in, you begin to see the body politic’s rhythm, the interval between comments, the ones that get picked, the ones that don’t. You begin to see the intelligence of the swarm at work, separating the brand management from the passionate, rewarding the humor with silence to let the gems resonate. The swarms of silence.

It’s not easy to hold your fire, or speak when you’re afraid of not being perfect. The realtime conversation has been attacked as creating an opportunity for thoughtless bravado and chattering of the mind, but more often than not the evidence points in the other direction. Particularly in an identity-focused environment like FriendFeed, the nasty stuff is muted by concern for reputation – hiding and liking are not necessarily weighted in the service’s core algorithms but the cumulative effect is visceral.

For now, FriendFeed has limited tools for sensing presence and aggregating distributed conversations. Ironically, @replies on Twitter are more useful for initiating a communication, though FriendFeed direct messages promise to improve cross-domain visibility. What comes next is the buildout of the rich middle of the realtime experience, where Twitter’s broadcast model breaks down and IM and email prove too siloed.

Track, of course is the foundation of such commerce, a distributed series of freeways where affinity services can be sampled, meshed, and decoupled. This is the intersection of social cloud computing, an elastic virtual town hall where the efficiency of social gestures, their transparency and pragmatism, produce high-value communication. It’s there already for the observing, even with just two weeks of probing. Best of all, the assholes who say this is much ado about nothing are reluctant to venture into the realtime arena. See you on the Funway.

Big Blue Takes Its Software To The Tracks
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by Leena Rao on April 17, 2009

IBM is moving into the transportation industry by helping railway companies operate their trains and infrastructure. In particular, IBM is helping develop high-speed rail networks globally, and released a study called the “The Smarter Railroad,” highlighting how emerging technologies will help rail companies better instrument and manage rail networks.

According to the report, the top challenges in the development of sound rail systems are capacity, congestion, operational efficiency, reliability, safety and security. And IBM says its technologies can help rail companies better instrument, analyze and manage rail networks and equipment in real-time. IBM says that $300 billion will be spent globally to upgrade, expand and initiate high-speed railway networks during the next five years.

High-Speed rail is uber-fast railway transportation between geographic areas, which goes 2-3 times faster than the Acela train, the fastest of Amtrak’s commuter trains. According to IBM, high-speed trains travel at speeds of close to 200 miles per hour. High-speed rail is a hot topic in the U.S. these days. President Obama just pledged nearly $13 billion dollars to funding high-speed railway projects in the U.S. If you take a look at the vision for the high-sped railways in the map, there are a good amount of potential spots where high-speed rail could be built. California is already planning a high-speed rail network the state.

IBM is already using its software to provide advanced transportation analytics, research, supercomputing and new sensor networks for high-speed rail projects in China, the Netherlands, Stockholm, Brisbane, Singapore, Dublin, and London. And the company hopes to be the provider for this technology in the high-speed projects in the U.S. But if these projects ever do come to fruition, Big Blue will have some stuff competition from other companies who dabble in the transportation technology space, like Accenture and Cap Gemini, for the contracts.

Here’s a video detailing IBM’s railway transportation initiatives:

by Leena Rao on April 16, 2009

McKinsey & Company released a report, “Clearing the Air on Cloud Computing,” today that claims that large corporations could lose money through the adoption of cloud computing. The report paints cloud computing as over-hyped and maintains that cloud computing services like Amazon Web Services (AWS) overcharge large companies for a service the companies could do better on their own. The study also says that while cloud computing is optimal for small and medium-sized businesses, large companies will spend less if using traditional data centers. Virtualization is the optimal way to go, says McKinsey, and by implementing virtualization in-house, corporations can reduce costs when factoring in depreciation and tax write-offs. Virtualization, which McKinsey says can boost server utilization to 18% from 10%, lets you treat one machine like many, by carving the servers into many virtual engines, so that software can maximize power from one machine and add scalability. Not only is this cost-effective for companies, but cloud computing takes advantage of virtualization.

The report makes some thought-provoking points but neglects to address a few key trends that are occurring in cloud server services. Innovation is rapidly changing in the cloud. The space is still very much a work in progress and big cloud computing services, like AWS, Google, Sun Microsystems and Microsoft, are regularly coming out with different products. As these companies throw their hats into the “cloud computing ring,” AWS will face increased competition in the market and could cause prices to go down to fight for market share.

by Robin Wauters on April 16, 2009

Looks like Sun Microsystems is open to renewing acquisition talks with International Business Machines (IBM) if the latter makes a stronger commitment to actually closing the deal, according to Bloomberg sources.

Earlier this month, discussions over a potential takeover broke down when IBM withdrew its earlier $7 billion bid to buy Sun.

Discussions have stalled, still according to the sources, and both companies are now waiting for the other to make a move.

The information provided by the two unnamed sources implies that Sun withdrew exclusive negotations with IBM because there were apparently no guarantees that they would ultimately stick with the takeover if the companies encountered barriers such as an antitrust review. So basically Sun is saying: if you’re going to talk the talk, you’d better be prepared to walk the walk.

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