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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Sam Citron who wrote (7091)	9/8/2003 1:26:12 PM
From: Lizzie Tudor	Respond to of 25522

Sam, Oracle sells software to IT departments almost entirely. When I worked with Oracle for example, Sprint IT was just about the biggest win you could get. Sprint and other large IT shops are offshoring now, they are outsourcing the entire shop to India, usually using Satyam or Infosys. That means, if Oracle wants to sell software to Sprint, now, they actually need to sell to Satyam. Not entirely of course, because Sprint still has a CIO and they are only in the process of offshoring the whole business. Also, Sprint bought Oracle years ago so oracle/msft etc are "locked in". But say you have a new piece of operational software for the enterprise you want to sell. The sprint IT management isn't going to care, nor will they be interested in this. Satyam is interested in operational software but they pay staff $5K/year so how much is operational efficiency worth to them, not much. If a US software company comes up with new software that really does something that makes a huge difference from a business perspective to Sprint management there is probably a sale to be had. But anything that relates to operations- DBA software etc, any QA type software for new product deployments (mercury interactive for example), code management/migration software- basically any product that helped in the development process- this stuff that we have in the US today is too expensive and not cost effective for an indian team, this market is in the process of collapsing. CRM call center is the classic example. There is a cottage industry in india to create CRM call center software I am sure. There is no market for US made CRM products that Siebel used to sell, that stuff is just too expensive for an indian market. I come from enterprise software so this transition has been painful for us. But the upside is significant too, it is just affecting different industries like the SCEs. Every one of those indian workers that is now employed by Satyam to do work for Applied needs hardware and infrastructure. Only software is cannibalized, the PCs, chips, networking infrastucture is money that Applied is happy to spend because they save so much in employee costs. So there is a huge upside to chips and networkers in moving IT to india. Not to mention the lower costs for projects going forward that applied can do. Larry Ellison is totally screwed though, he is crying the blues again in the Chronicle this weekend. He compares Silicon Valley with detroit. The reason he is coming off as such a fool is that Oracle, more than any other tech company, ushered in the transition to an indian workforce. They were the first to shift their labor offshore. It was inevitable anyway but Oracle initiated their own demise, now Larry is crying over it, what a fool! Lizzie