Page 14 - enterpriseinnovation.net

viewpoint Charles Mok: The cashed-up Hong Kong govt must fund smarter IT initiatives Page 10
The Fourth
Utility
Your data-connectivity’s
crucial, but who’s building
it as a utility in Hong Kong?
Page 14
SINCE 1984
bizpeople
New IBM CIO
Mark Hennessy
Page 12
legalwatch
Contractual requirements
for security
Page 22
industry
HK’s online marketing
Page 24
backpage
Driving China’s ICT
By Robert Clark
Page 42

c o n t e n t s April 2009
coverstory
The 4th utility
18
It was standing-room-only at the
5th annual Banking and Finance
Technology Forum Asia 2009
bankingtech
Your data-connectivity’s crucial, but who’s building it as
a utility in Hong Kong? Page 14
business
4 upfront
“No comment”= no story
6 biznews
8 viewpoint
The cashed-up Hong Kong govt must
fund smarter IT initiatives
Charles Mok writes that although the
government has increased ICT spending, the
effect on the industry’s hardships is inadequate
10 bizpeople
Inside the new Big Blue
CIO Mark Hennessy on
transforming the IT organization
at IBM, fostering a culture of
innovation and managing IT
during the financial crisis
technology
28 technews
30 careerwatch
Microsoft teams with Cyberport to support
local start-ups
32 CWHKAwardsspecial
47 categories of excellence
36 networking
Social apps for business:
plan less for less pain
38 chinawatch
24
Local online marketing
intelligence firm to go global
As the downturn deepens, online
marketing becomes increasingly
important for Hong Kong, says
Admomo’s founder and director
Winston Law
Industryprofile
Check: www.cw.com.hk for daily news
and online features.
20 analystwatch
Asia’s top 10 locations for offshore IT
services
22 legalwatch
Security breaches: leaning on the
suppliers
26 industryevent
Helping the tough get going
27 industryevent
Driving IT to deliver full value
Five technology leaders shared their insights
into how businesses can leverage existing
capacity to help them navigate through the
current economic slump
Google share of China search market inches
up, Dell sees faster economic recovery in the
Middle Kingdom, VMware claims high demand
for virtualization in China and 3Com eyes
expansion from their ‘home market’
42 backpage
Driving China’s ICT
Huawei and ZTE go from merely being major
players to driving the whole sector, writes
Robert Clark
www.cw.com.hk
April 2009 Computerworld Hong Kong 3

upfront
Adecade ago, I edited an architectural magazine
here in Hong Kong. While conducting
an interview with a local architect who
held strong views on architectural aesthetics, he
vented his opinions about me and the magazine.
“You have a responsibility to the people of
Hong Kong!” he howled. “Why don’t you write
a review and tell everyone what a terrible building
[famous building on the Central waterfront]
is? And as for that eyesore [another famous landmark
on the Hong Kong skyline], you should
write a review of its lousy, amateurish architectural
design!”
I told him I thought that was a great idea: “And
I assume I can start by publishing
what you just told me about those
buildings.”
He turned pale and almost choked
on his latte. “No, no, you can’t do
that! You can’t publish what I just
said!!”
“Well,” I said, “you see the problem.
If no one’s willing to comment,
there’s not much of a story.”
Ten years later, the same philosophy
grips Hong Kongers dealing
with the press. The attitude seems to be: “If
you already know, I don’t need to tell you, and if
you don’t know, it’s not going to be ME that tells
you.”
This game of “no-comment” creates a circus of
absurdity. Every so often a journalist would run
into that brick wall once too often, and the resulting
copy was both cathartic and hilarious. At one
press conference for a retail-outlet years back, a
journalist asked how many branches the retailer
operated in Hong Kong. The spokesperson flatly
refused to disclose the number of stores—hardly
a state secret. The floodgates opened and the
journo went into rant-mode: their next column
detailed press-con “no-comment” absurdities.
Sometimes there’s good reason to keep information
confidential. Computerworld Hong Kong
has a policy of complying with requests made by
sources—people tell us things off the record, and
we keep them off the record. This is reasonable,
and we believe in reasonability.
But when things become a matter of public
record, and we have an opinion, we will state it.
Do we agree with every government policy? Not
necessarily, and as the government has a responsibility
to serve the people (ALL of them), disagreement
with policies that could be improved,
I feel, is reasonable.
We’d like to hear more from our readers,
which is why you can comment on our blogs or
on our Facebook page. You can remain anonymous
if you like. Please be reasonable (no links
to spamtastic.com, and leave the profanity to
LegCo members and Commercial Radio!).
More seriously, the “no-comment” press conference
is being replaced by the “no-client” case
study. Increasingly, vendors tell us about deployments
they’ve done that have saved the users
time and money and are “success stories” for
their companies, but won’t identify the user. We
understand that vendors must often sign non-disclosure
agreements (NDAs) to get the contract.
We’re sympathetic.
And we also ask for consideration. In many cases,
writing a quote or using a case-study without
naming the user is useless. We usually edit out
the reference, because it’s not useful
to our readers.
This is a subject I bring up in offthe-record
conversations with vendors,
and I find that they too feel
the frustration. Vendors spend a
lot of time and effort selling a complex
system and making sure it’s
deployed properly, supporting the
user throughout the implementation
and afterward, and they have a
story to tell. But if the user wants
silence, we remain mute.
The flipside of the coin: perhaps the user wants
to publicize their new tech system. And why not?
If you craft your message for content-value, it
may become news.
There’s a great difference between a press release
lauding anonymous users and a case study
which details TCO and ROI, tells the reader
how much time (and other resources) were consumed
and how the system is working. A superb
case study will tell us how many employees were
redeployed to more useful tasks within the organization
as a result of the tech upgrade.
It happens—a good tech deployment will make
your employees’ lives easier. We’ve seen it happen.
But unless the user is willing to reveal themselves,
we can’t report on it.
And lately, we’re getting more silence than
information. Considering IT stands for “information
technology,” that’s ironic. For journalists, it’s
also frustrating.
Stefan Hammond
Editor
shammond@questexasia.com
http://www.cw.com.hk
Computerworld Hong Kong is published by Questex Asia Ltd, 501
Cambridge House, Taikoo Place, 979 King’s Road, Quarry Bay, Hong
Kong.
EDITORIAL
EDITOR-IN-CHIEF Chee Sing Chan cchan@questexasia.com
EDITOR Stefan Hammond shammond@questexasia.com
SENIOR REPORTER Teresa Leung tleung@questexasia.com
CONTRIBUTING WRITERS Ross Milburn, Jason Krupp
SALES
PUBLISHER Simon Yeung syeung@questexasia.com
ACCOUNT DIRECTOR Connie Yip cyip@questexasia.com
MARKETING & SALES Donna Hon dhon@questexasia.com
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ART DIRECTOR Eric Lam elam@questexasia.com
PRODUCTION & Donna Hon dhon@questexasia.com
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CIRCULATION & John Lam jlam@questexasia.com
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ASSISTANT CIRCULATION Allie Mok amok@questexasia.com
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HR & ADMIN MANAGER Rebecca Ip rip@questexasia.com
BUSINESS MANAGER Eunice Chan echan@questexasia.com
Computerworld Hong Kong is published monthly. All
material is Copyright 2009 by Questex Media Group,
Inc. Reproduction is strictly forbidden without written
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Sales and Custom Publishing Enquiries: E-mail can
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Takeaminutetosavemilionsinvendorlock-incosts.
WatchourChoice&Flexibilityvideoatjuniper.net/choice
© 2009JUNIPERNETWORKS,INC.

iznews
China becomes a leader in managed print services
China has become one of the leaders in
Asia Pacific’s managed print services
estimated to reach US$1 billion by 2012,
said Springboard Research recently.
The managed print services (MPS) market is
forecast to grow from US$392 million in 2007 to
US$825 million in 2011, according to the research
house.
“These robust growth figures indicate not just
a vibrant MPS marketplace,
but they also reflect
the emergence of
MPS as the best growth
bet for the print hardware
vendors in the
region, who have seen
a decline of hardware
sales amidst the economic
slowdown,” said
by 2012
Sanchit Vir Gogia, senior
research analyst for Services at Springboard
Research. “Enterprises in the region are eager to
test and adopt the ‘next level’ of printing environment,
presenting the MPS vendors with a growth
opportunity in a difficult economic situation.”
Australia and China lead the region
Australia and New Zealand together will remain
the largest MPS market in the region throughout
the forecast period of 2007-2012; cornering
over 25 percent of the market and expanding at
a CAGR of 19.3 percent, Springboard said. While
China’s managed print services to top US$1 billion
India is behind China and ASEAN in overall market
size, the south Asian country is forecasted to
be the fastest growing market in the region with
a CAGR of 22.6 percent, the analyst firm added.
“The MPS model is still in its infancy in Asia Pacific
and enterprises in the region need to be educated
that this is much more than an alternative
print hardware purchase model,” said Phil Hassey,
vice president for services at Springboard
Research. “The challenge
for providers is
to ensure they manage
MPS offerings prices
and offer solutions as
a long-term strategy,
providing immediate
and successful results
for enterprises.”
In the MPS competitive
landscape,
HP is the clear leader with a dominant market
presence in the region’s marketplace, said
Springboard. In second place, Fuji-Xerox has
leveraged its robust set of MPS offerings and a
strong partner ecosystem to strengthen its regional
presence, Springboard added. Lexmark
is the only other global printer vendor who has
a discernible market presence in the region,
Springboard noted. The remaining market is
highly fragmented and is made up of local service
providers and other printer vendors, the
research company observed.
By Matt Hintsa
Express e-channels aimed to reduce border
crossing time from 12 seconds to eight
seconds have attracted 126,512 Hong
Kong residents to sign up for their trial run.
The Immigration Department has installed 10
express e-channels at the Lo Wu control point
since early March as part of a HK$7 million pilot
project.
According to the department, around 20,000
travelers use the news express e-channels at Lo
Wu daily, about 18 percent of the total e-channel
user base. The department’s figures indicate that
about 1.2 million Hong Kong residents visit China
via Lo Wu at least once a month.
“As there’s a daily average of 10,000 Hong Kong
residents completing the enrollment process, we
expect to sign up all 1.2 million frequent users in
four months,” said Jacqueline Kwan Chan Suetmui,
assistant immigration director (information
systems).
Instead of inserting their ID cards into a reading
machine when using the traditional e-channels,
users of express e-channels put the cards on
an optical reader.
An optical reader scans only the personal information
on an ID card rather than information
from the ID card chip scanned by traditional e-
channels, the department said, adding that the
entire optical scanning process takes just three
seconds.
Users must give consent to the director of immigration
for personal data retrieval from the
chips in their ID cards and to such data being
stored for subsequent self-service immigration
clearance, the department added.
As the user data are stored on the Lo Wu server
not connected to other networks, the department
assures the public that personal data cannot be
leaked to outsiders, said Kwan.
Kwan noted that the department will conduct
a review when the pilot ends six months later:
“We will then decide whether the express service
should be extended to other checkpoints.”
—Compiled by Teresa Leung
newsbites
Korean asset management firm deploys
TelePresence
Datacraft said it has completed the installation of a
Cisco TelePresence system for Korean asset management
firm Company, Mirae Asset Global Investments’
offices in South Korea and Hong Kong. The tailor-made
system for Mirae Asset includes the installation of two
Cisco TelePresence Systems (CTS) 3,000 in Korea and
Hong Kong and four CTS 1,000 systems to be deployed
in India, Brazil, the US and the UK. The network hub in
Seoul, Korea also comprises a TelePresence manager,
Call manager, multi-point switch and LDAP facility,
Datacraft added.
Adobe-enabled stream video at
Oriental Press
Adobe has announced that Hong Kong-based Oriental
Press Group has selected Adobe Flash Media Server
software for streaming video on ontv, the company’s
online TV service on its news and information Internet
portal on.cc.
The on.cc portal combines content from two of the
territory’s daily newspapers, Oriental Daily News and
The Sun, as well as streaming video content from their
TV service. Oriental Press said the site has 2.1 million
unique viewers each month.
AOL closes China R&D base as
economy slides
America Online will close a research and development
base in Beijing but keep trying to break into China’s
market amid the sliding global economy.
The Beijing office, which opened in 2007 and has 56
staff, will be shut down by midyear given poor economic
circumstances and reorganization plans, an AOL spokeswoman
in the US said via e-mail. But AOL’s Web portal
for mainland China, launched last year, will continue to
operate from the company’s Hong Kong regional base,
the spokeswoman said.
Amerson to set up China delivery
center
US consulting and outsourcing services company
Amerson will set up a global delivery Center in Chengdu,
China. “The setup of the delivery center in Chengdu is
very important to the company’s regional and global
development strategy, “ said Dr Rob Ouyang, managing
director of Amerson, adding that the city has exceptionally
well investment environment, locally abundant talented
resources and high efficiency of government services.
Dell cuts staff worldwide
Dell in mid-March said it had laid off staff at different
sites worldwide in an effort to cut costs and streamline
operations. The company didn’t provide an exact number
of employees it had laid off. However a company spokesman
said that jobs were cut globally, including sites in
Texas and North Carolina.
6 Computerworld Hong Kong April 2009 www.cw.com.hk

Sponsored Feature
Coping with network strain
With network complexity rising Juniper’s EX Series Switches offer
performance, security and significantly simplified management.
Juniper’s EX Series Switches put an
emphasis on uptime, reliability and
simple management.
associated with true chassis-based systems.
Bunt noted that companies can now use the virtual
chassis concept to manage network expansion from
a single chassis and still utilize the shared redundancy
across a new branch network and across multiple
locations.
“The EX Series offers carrier-class reliability, operational
simplicity and integrated security in the form of
end-point protection,” said Bunt.
Switches at work
Bunt also pointed out existing customers who are
taking full advantage of these features.
One organization reaping the benefits of the Juniper
EX Series of switches is the Pittwater Council in
Sydney, Australia.
As a local council body, its responsibilities to citizens
have changed from managing tasks like rubbish
collection to creating and managing interactions and
electronic platforms for public service delivery.
This recent strategy has resulted in a critical need
for a reliable and secure platform for information delivery
and robust disaster recovery solution to ensure
service levels are never disrupted.
The choice was to outsource the operation or build
its own system. The latter choice was taken and Pittwater
Council utilized the Juniper EX4200 Ethernet
CIOs today face unprecedented challenges
with massive pressure to cut cost, drive efficiency
while also deliver even more services
with ever limited resources. Data centers are being
consolidated and virtualized while networks face
growing performance needs, security requirements
and more complex management issues.
The wave of added functionality at the network
level is creating tremendous management issues for
CIOs and network managers.
Networks were designed originally just for connectivity.
“But in recent years companies have bolted
on additional functions to the network as an afterthought,”
said Greg Bunt, Asia Pacific Director for
Advanced Technologies, Juniper Networks. First it
was integrating security, then new applications like
voice and video with the need for QoS, then issues
like enabling number portability and now its end-user
authentication.
“The list grows longer by the day and networks today
have to enable all of these in an easy, reliable and
secure manner,” Bunt added.
Under pressure
But the need to invest in new networks and tools to
manage these issues is tempered by the severe cost
pressures. CIOs on average have 70-80% of their
budget already tied up by essential management and
maintenance costs, leaving little to invest in anything
strategic.
With budgets being cut that gives CIOs even less
room to move. On top of this the restrictions on resources
mean there is a huge demand for highly
skilled professionals to manage the vast network
challenges with fewer people and tools.
“In the current environment such highly-skilled
people are even harder to find as they tend not to
move from their existing jobs,” said Bunt.
In response to these challenges enterprises have
sought to deploy networking platforms that enable the
network perform at higher service levels with the same
resources and remain easy to manage?
Single view
Juniper’s solution is its EX Series of Ethernet switches.
The EX series portfolio is designed for network
performance-minded enterprises and service providers
with an emphasis on uptime, reliability and simple
management.
One unique feature is its single OS which is consistent
across the whole series of EX switches as well as
Juniper’s complete portfolio of networking and security
products.
Many competing platforms have adopted the
approach of an OS for each and every product
range. Having different versions of OS on switches,
routers, application management and security
products just makes the management challenge
increasingly difficult. Juniper’s JUNOS operating
system allows users to patch and update OSes
and have that applied consistently across their
networks. This lowers management costs and
eases the burden on network managers.
Virtual networks
Another unique feature of the EX Series of
switches is its virtual chassis technology. This enables
firms to connect multiple switches together
to act as one logical device that can support up
to 480 10/100/1000BASE-T ports. Because of the
modularity of the Virtual Chassis, switches can be
added on as needed. This scalability reduces the
initial investment as well as operational expenses
Greg Bunt, Juniper: Networks were designed
originally just for connectivity. But in recent
years companies have bolted on additional
functions to the network as an afterthought.
switch with virtual chassis technology to help support
the DR capability. The Virtual Chassis allowed optical
links to be concurrently utilized, increased throughput,
reliability and enabled easier administration The
capital expense of this option was calculated to be
far less than the outsource option and delivered the
required service levels for backup and recovery operations
Ajisen (China) Holdings Limited which operates
an extensive chain of restaurants across China and
Hong Kong has also everaged the EX switching
platform and additional Juniper technology including
firewalls and remote access VPN and Juniper
routers.
This has enabled Ajisen to deliver business critical
services to a massively distributed environment covering
243 locations. IT administration has been drastically
simplified and reliability and security markedly
improved.
For more information or enquiry
please email hk_enquiry@juniper.net

Check Point helps firms cut
through the security tangle
Check Point’s new software blade
architecture set to deliver flexible and
manageable security to businesses of all
sizes
Let’s face it, securing a corporate IT infrastructure
is a challenge for any business
regardless of size, particularly as IT departments
roll out layer upon layer of security
technology to cope with the continually growing
number of threats.
What this has created is an environment
often characterized by a host of overlapping
products, hardware platforms, management
consoles and daily monitoring systems.
And this is often a Gordian Knot that is inefficient,
costly and difficult to get a clear understanding
of where the vulnerabilities are.
“Every application comes with a package of
threats. Every time we evolve in this industry
there are new threats created and we constantly
need to have an answer to these,” said Itzhak
Weinreb, Vice President of APAC Sales for
Check Point Software Technologies Ltd.
“Now consider that there are thousands of applications
out there, dozens of technologies and
hundreds of vendors – it is an ongoing nightmare
for any CIO.”
Weinreb said this clearly highlights a need
for a single security suite that is simple to rollout
and maintain, flexible enough to grow with
the needs of the business and with a high degree
of manageability to make operating and
reporting easy.
And he believes that Check Point has answered
all of these key criteria with its latest
security gateway version, the R70.
Live by the blade
What sets the R70 apart is that it is built on
software blade architecture, a first for the security
market.
What this essentially means for customers
is the ability to select exactly which security
products they want from a
library of over 20 software
blades to create a unique
level of protection tailored
to their operating environment.
The libraries include VPN,
Firewall, URL filtering, antivirus
& anti-malware, antispam
and intrusion prevention
system (IPS) modules among
others.
And as the business
grows, additional blades can
be quickly and easily added
to the existing platform,
ensuring the investment is
right-sized to current needs
but flexible enough to grow as the business
does.
Additionally, the software blades can be added
without deploying new hardware, reducing deployment
times and operational costs, as it runs
on Check Point UTM-1 and Power-1 appliances,
open servers and within virtualized environments.
“The idea is to give the customer the option to
choose what they want to put on their system,”
said Weinreb.
“They can either do this a la carte, and choose
the blades that suit their business, or they can
choose from one of our packages because
Check Point’s Itzhak Weinreb:
Our main interest is to simplify everything—the
management tools help
you monitor and control everything
from a single location
we know more or less what
customers at different levels
need.”
Blades for all sizes
The flexibility of Check Point’s
solution extends even further,
giving IT departments the ability
to select specific versions of
the R70 to meet their current
hardware, and is available in
single, two, four or eight core
versions.
And by going the software
rather than the hardware approach,
the R70 is easily integrated
into existing security
infrastructures.
There are thousands of applications out there, dozens of
technologies and hundreds of vendors – it is an ongoing
nightmare for any CIO.
Itzhak Weinreb
All this reduces the total cost of ownership, a
key pain point for many CIOs, under pressure
from senior management to reduce costs in the
current economic climate.
In addition it means the R70 security software
can be rolled out to any organization, whether
they are a small, medium or enterprise-level
business.
“The small market is getting the same security
functionality as the big enterprises but at the
right price,” said Weinreb. “They just choose the
version to match the size of box.”
Another impressive feature of the R70 is in its

Sponsored Feature
functions, allowing them to graphically view high
volumes of event data in real-time and quickly
drill down from a business view of events to a
forensic level of details.
The new provisioning of software blade provides
centralized administration and activation
of Check Point security devices via a single
management console. The unique unified management
architecture of Check Point R70 allows
administrators to manage, set policy and apply
protections across the entire security infrastructure
from a single interface.
Check Point’s IPS software Blade secures everything from the client to server and
OS vulnerabilities, malware and worm infections
At the end of the day it is about giving the customer choice.
CIOs get to invest in the infrastructure that they need, not
what the industry and vendors are bundling together.
Itzhak Weinreb
“Our main interest is to simplify everything the
management tools help you monitor and control
everything from a single location. You get
reports from each machine identifying what are
its weaknesses and how to solve it – even remotely,”
noted Weinreb.
“This saves a lot of internal resources because
you only need a bare minimum of staff that is
familiar with the easy to use management tools
to run the entire security operation.”
This resonates well with CIOs today, because
it lowers operating costs, and decreases the reliance
on specialized security skills, which are
often expensive and in short supply.
ability to allow administrators to set the performance
levels of each blade.
“This is a real revolution when compared to
UTM products for instance. Most UTM products
offer a fixed combination of security functions on
a fixed platform for a fixed price. There is no option
to disable functions to improve overall performance
nor is there an option to add function
as security needs change.”
In the new Software Blade architecture, security
functions run as a separate piece of software
within the same software environment. Security
managers can choose different combinations of
Software Blades in ‘containers’, predefine the
level of performance and manage all applications
in a consistent way from a central management
system.
This means guaranteed performance, according
to Weinreb.
Walking the talk
The new IPS software blade uses a multi-tier intrusion
prevention engine that allows businesses
to pre-emptively protect themselves, by securing
everything from the client to server and OS vulnerabilities,
malware and worm infections.
And the increased performance of the Check
Point R70 means businesses have a unique
alternative to pre-emptively protect themselves
against all threats by deploying the IPS software
blade on every gateway.
Weinreb believes this is an attractive offering
to many customers out there.
“Today, about 80% of customers do not turn
on IPS due to performance concerns.” said
Weinreb. “This is why we came up with the idea
to integrate the IPS into the blade platform. “This
enables full IPS utilization. All customer has to
do is activate the IPS blade, activate the acceleration
blade and set up the performance level.”
Keeping it simple
While Weinreb is happy to talk about the nuts and
bolts of the technology under the hood of the R70,
he also notes that this solution would not be complete
without manageability and good reporting.
It is for this reason that Check Point introduced
two security management blades for IPS event
analysis and provisioning of gateways.
The IPS event analysis blade provides customers
with the ability to focus on critical events and
Seamless deployment
Weinreb also points out that while the R70 and
Check Point’s software blade architecture form
the basis of a new security platform, it still compliments
the current security offerings.
“Even if you are running the R65 on the current
box, you don’t need to change the box, just
upgrade to the latest version, the R70. And it is
an upgrade, not a completely new deployment
which is another advantage.” said Weinreb.
Ultimately Weinreb believes that the R70 and
Check Point’s software blade architecture will
resonate with CIOs in the current economic climate
and beyond, because regardless of market
booms or busts, flexibility, manageability and
lower total cost of ownership are always going to
be important to any business.
“At the end of the day it is about giving the customer
choice. CIOs get to invest in the infrastructure
that they need, not what the industry and vendors
are bundling together,” concluded Weinreb.
The key focus is to address CIO pain points, giving
them a complete security solution that is simple,
flexible and manageable, and one that they can
easily justify investing in because of the lower cost
of ownership, a key criterion in these tough times.
Check Point company website: http://www.checkpoint.com
Email: info_ap@checkpoint.com

viewpoint
Charles Mok
The cashed-up Hong Kong govt
must fund smarter IT initiatives
John Tsang, our Financial Secretary, unrevealed
his second budget in February and
said that “preserving jobs” was his objective.
The theme surely resonates with the public,
but the content of this budget does not justify its
stated goal.
Those who criticize the Hong Kong government
for neglecting its citizens’ hardship
during the current downturn have a point.
Governments around the world are enacting
aggressive economic stimulus measures. But
our government seems to be sitting idle in
spite of record fiscal reserves.
Hong Kong: cash-rich, initiative poor
At the end of January 2009, our fiscal reserves
reached a record-breaking HK$543
billion, while accumulated surplus of the Exchange
Fund was around HK$500 billion. According
to a government press release, as at
31 January 2009, the financial position of the
government stands at the enviable level of
HK$49.8 billion surplus. Instead of the fiscal
deficit of HK$4.9 billion that the government
estimated in the budget, we may end up with a
huge surplus at the end of this financial year.
Taking into account this possibility of a huge
surplus, the meager initiatives proposed in the
budget are even worse than when they first
meet the eyes. On the ICT front, although the
government has increased its ICT spending,
the effect on alleviating the industry’s hardships
is inadequate.
Perhaps more so than in other industries,
our ICT sector faces dwindling demand, and
professionals are under threat of layoff day
and night. Yet prices—for products, services
and manpower—are falling. This is the perfect
opportunity for the government to improve
our information infrastructure, in order
to provide better public services, help sustain
demand, and preserve jobs.
The government must recognize the irreparable
damage that will be caused to the ICT
industry in financial downturns, as ICT skills
are harder to maintain than most other professional
skills if a professional is out of action
for a year or several months. Our industry
and indeed the entire Hong Kong professional
workforce will face a shortage of ICT talent
when the economy recovers—similar to the
post-SARS situation.
E-health scheme not enough
The only bright spot is the appropriation
for the territory-wide e-health records (EHR),
which will go a long way to establish Hong
Although the government has increased its ICT spending, the
effect on alleviating the industry’s hardships is inadequate
Kong as a center of health information system
development. But the ICT industry must
be further and better engaged in the setting
up of the strategy and direction of EHR, so
that the ICT industry will be able to participate,
contribute and benefit from this sizable
investment.
The “MyGovHK” project, which allows users
to customize the government portal, is another
idea I previously proposed in my “Ten
Information Infrastructure Projects.” The government
finally accepted the need for Hong
Kong to have a clearer policy to support the
development of data centers—also welcome
news, after years of lobbying from the industry
and myself along with former LegCo member
Sin Chung-Kai urging the government to
remove restrictive barriers in their land and
innovation support policies.
Hiring for specific needs
But the government’s responses to our other
recommendations in other policy areas, such as
education, transport, food labeling and so on,
have fallen short of the industry’s expectations.
For instance, the budget earmarked HK$63
million for a one-year education program on
online safety, which will create 500 jobs.
But the fund could be much better utilized
if each school hires a single IT assistant: a
trained tech to alleviate the heavy workload of
teachers who must handle IT support chores
in addition to teaching. Instead of the unclear
motives and clearly one-off nature of the proposed
program, what teachers and students
really need is the government’s commitment
to support them in a sustainable way.
The Financial Secretary has indicated that
he may announce further mid-year initiatives,
opening a door for further supportive measures.
It’s high time for our sector to unite
behind a common cause: urging government
to recognize the ICT sector’s importance to
our economy and financing more concrete
measures to re-ignite our momentum, so that
Hong Kong can realize our potential when we
emerge from this crisis. This “worst of times”
is indeed the best of times to make this investment
on ourselves, and we must realize that
this is a once-in-a-century opportunity we are
facing, not a crisis
Charles Mok is the president
of Internet Society Hong Kong,
and ex-officio Member of the
Hong Kong Information Technology
Federation. He has been
in the IT industry for almost 20
years, and is active in a number
of advisory committees and
statutory bodies of the HKSAR government
10 Computerworld Hong Kong April 2009 www.cw.com.hk

izpeople
Inside the new
Big Blue
???
CIO CANADA: How are you, as a CIO, responding
to the current difficult financial
situation on an immediate and longer term
basis?
HENNESSY: We are being very deliberate
about what the returns are going to be from the
investments we’re making and what the business
cases are behind those investments. We’re also
trying to shorten the time to value for those investments;
we’re working on projects that have
quicker returns, more hard-dollar benefits, as opposed
to multi-year projects.
We’re also trying to make our application development
and our transformation programs more
agile and more tightly integrated with the business
units, so we really understand what value
needs to be created quickly and what the return
on that is going to be.
CIO Mark Hennessy on transforming the IT organization at IBM, fostering a
culture of innovation, managing IT during the financial crisis and the value of
social networking tools By David Carey, CIO Canada
a governance model, and by building a skilled
team. All of those things that go into an IT transformation.
CIO: How far have you progressed with the IT
transformation?
HENNESSY: From a centralization standpoint,
we’ve made a lot of progress, consolidating
155 data centers down to five strategic centers
around the world. From an application sunsetting
standpoint we’ve gone from 16,000 down to about
of employees has been increasing, our IT cost
has come down by 26 percent.
We’ve done an awful lot but there’s still a lot
more to do. We’re going to carry on with our IT
transformation [and] continue to drive down our
costs so we can invest in other areas.
CIO: Can you talk about some of the projects
you have under way?
HENNESSY: We’re now in the middle of a very
large virtualization project. About a year ago I
We’ve gone through an IT transformation over the past five to
ten years, going from 128 CIOs down to one
CIO: How is the IT landscape at IBM changing?
HENNESSY: We’ve gone through an IT transformation
over the past five to ten years, going
from 128 CIOs down to one. We’re focusing on
ways to drive more efficiency, such as centralization
in terms of reducing the number of data
centers, sunsetting legacy applications, working
with partners much more closely, and optimizing
our global resourcing.
We’re ensuring that we have a tight relationship
with the business units and making sure we
have a balance between operational excellence
and business value—we’re creating that balance
with a set of standards, with an architecture, with
4,700. I still think 4,700 is too many and we’ve got
work underway to bring that number down.
We’ve done a very good job in terms of working
closely with partners. As an example, we
have one global network now as opposed to
sourcing our network from lots of different
places or driving it internally. We’ve also made
some fundamental steps forward in things like
VoIP.
And we’ve optimized our global delivery—we
now have multiple locations around the world
that have certain skills that we need—and we’ve
figured out how to optimize both service delivery
and application services. Over the past five
years, even though our revenue and our number
challenged a team to take about 25 percent of our
infrastructure, about 3,900 servers, and consolidate
them down into 30, and that project is going
very well. For us the best approach has been to
consolidate those Intel and UNIX servers onto a
Z platform running Linux.
We also have a lot of work going on around
application development and driving for a much
faster return on investment, reducing the time
to value through agile methodology and rational
tools and looking at an outcome-based model as
opposed to utilization models.
CIO: What’s IBM doing to foster a culture of
innovation across the enterprise?
12 Computerworld Hong Kong April 2009 www.cw.com.hk

izpeople
HENNESSY: CIOs today are well positioned to
address this issue. First of all, they’re one of the
few executives that see the enterprise from endto-end,
across all business units, across all geographies.
They see the data flows, they see the
interactions, and so they have a good perspective
on the enterprise itself.
Secondly, they have access to a lot of these
exciting new tools and technologies around social
networking [and] Web 2.0. We are working
hard to try and use those tools and that
knowledge to drive innovation. We have four
generations of IBMers—traditionalists, baby
boomers, Gen X, and Gen Y—and they’re
spread out all over the world. We need to try
and figure out how to use these tools to drive
relationship-building, and then collaboration,
and then innovation across all of our employees,
regardless of what business, geography or
generation they’re in.
We’ve started to implement lots of different
tools to do this, such as blogs and wikis. We have
about 18,000 blogs up and running now, and over
half of our population—about 200,000 people—
are using Wikis as an ongoing part of their business.
We also have online collaboration forums
where people can go into an online team room
and introduce topics that others in the organization
can talk about, or managers can come in
and sponsor a work effort that anyone can collaborate
on. Communities have now started to
build around topics that groups of people are interested
in.
CIO: How are you fostering technology innovation?
HENNESSY: From out of the CIO’s organization,
we have what we call a Technology Adoption
program, which is kind of a sandbox that
we’ve built where people can try new tools and
new processes. They can then provide feedback
to the developers and help shape the new products
and processes, ensuring that they’re as valuable
as possible, whether the intention is to take
those new tools to the market or to use them internally.
CIO: What are you doing to help optimize the
value of the social networking tools you’re using?
HENNESSY: I find it important to try and understand
the value of each of these different tools,
and I do that in a number of ways. How many
ideas are created by a particular tool? How many
get sponsored by somebody that has a budget?
How many are collaborated on? How many actually
make it to market? What revenue is generated
by those ideas?
I have a set of tools now that I use to track
the ideas and the innovations that come out of
the different tools—so that I can better align my
investments to the tools that are driving the better
and more innovative ideas. That’s something
that I spend a lot of time talking about with
other CIOs around the world: the ROI of social
networking.
CIO: What’s the company’s attitude towards
younger employees using their own social networking
tools, such as Facebook?
We have about 18,000 blogs up and running now, and over half
of our population—about 200,000 people—are using Wikis as
an ongoing part of their business
HENNESSY: I think it would be hard to try
to control it or turn it off. We understand it’s
a reality and we have to try and leverage that
technology internally. So we give all of our employees,
regardless of what generation they’re
from, the opportunity to use these tools to collaborate,
post their ideas, and work with colleagues
wherever they are to try and come up
with the best solutions for their clients or for
their own internal customers. Because we have
a culture of innovation, utilizing these tools to
get ideas from colleagues is very natural and
it’s taken off quickly.
The other interesting thing is how are we going
to start using those social networking tools
outside the firewall? We started to do it on a
couple of different projects. One is our corporate
service corps, which is a group of IBMers
that have taken a leave to work in emerging
markets and places that need their assistance.
We now have a Web site that is a part of the
social networking tool that allows interaction
between those folks and the government agencies
that they’re working with and others that
have ideas that can help them. And we’re going
to do more of those types of things to help give
our clients better access into our resources,
our people, our intellectual property and our
key industry thoughts, because we think that
will be helpful in terms of developing new ideas
and new solutions and helping create more value
for our clients.
CIO: What advice do you have for other CIOs
around innovation?
HENNESSY: I would say experiment and pilot.
There are different innovation tools and approaches
out there—it’s not one size fits all.
Everybody’s company is a little different. Their
organizations, their geographies, their cultures
are a little different. If you start with different
tools and incubate them and test them and pilot
them, you’ll start to see what may work well for
your company
I was with a CIO in Japan and his approach
was to create a blog for himself and ask employees:
what issues keep them from being
successful? He was amazed at how quickly he
got ideas back—he didn’t expect that kind of
direct dialogue. Another CIO started his own
Facebook type of social networking tool and
he posted ideas about himself personally. Others
in his organization started doing the same
thing, and they found that the relationships
started building quickly across business units
and geographies—they got to know people who
were interested in similar kinds of projects, who
were working on the same kinds of issues for
their clients, and so that took off pretty quickly
for them.
CIO: What technology would you point to that
is going to have a significant impact in the
next three years?
HENNESSY: The pervasive devices that are
emerging around the world in all different industries—sensors,
monitors, cell phones or whatever—are
really going to change the environment
that we’re in, whether they be wirelessly connected
or not. These pervasive devices, as they
become intelligent and interconnected, are going
to create an opportunity for understanding
the environment and making some significant
changes.
All of these embedded devices, as they become
more interconnected and intelligent, are going to
give us opportunities for other types of ‘smart’
environments. And figuring out how to take advantage
of that, not only to improve efficiency
and effectiveness but also to give value back to
businesses, governments and society as a whole,
is going to be important.
www.cw.com.hk
April 2009 Computerworld Hong Kong 13

Your data-connectivity’s
crucial, but who’s building it
as a utility in Hong Kong?
By Stefan Hammond
The first electrical standards fight raged a
century ago. On one side: famed inventor
Thomas Edison, who is credited with inventing
motion pictures, the incandescent light
bulb and audio recording on wax cylinders. On
the other: a Serbian inventor—part genius, part
Bottom Line:
build
madman—named Nikola Tesla.
Although many believe it was
Marconi who invented radio, it
was in fact Tesla, and the volatile
Serb had a powerful backer:
tycoon George Westinghouse,
who believed that the Tesla
Polyphase System should be deployed
to wire the households of
the USA’s east coast with electrical
current.
Edison made no attempt to
conceal his displeasure. Alternating
current (AC) was dangerous, he thundered,
pointing out that AC was used in the
electric chair to execute criminals. Westinghouse
and Tesla countered that the only way to
transmit current efficiently over long distances
was via an alternating polyphase system which
would carry juice “the last
mile”: into the home. Giant
transformers would encode
the current at a frequency of
60 Hertz (Hz, then known as
“cycles per second”).
Edison had a financial stake
in the direct-current standard.
But needless to say, he
lost, because Westinghouse
and Tesla were right about
long-distance transmission.
Electricity delivered via AC
14 Computerworld Hong Kong April 2009 www.cw.com.hk

ecame a utility, although it was many more
years before a dependable, accurately calibrated
supply was available at wall-sockets around
the world.
One thing is true of both inventors: neither
could have imagined the usages we now have
for electric current. It’s a utility we never think
about until a circuit-breaker trips, cutting off
the juice.
Electricity—along with water and telephone
lines—are three utilities most Hong Kongers
take for granted. While the uses for wired telco
lines are fairly limited, use of water is more
creative, and electricity heats, cools, amuses,
illuminates and even prolongs or saves lives.
Most of electricity’s uses weren’t dreamt of
in Tesla’s time (although he did build massive
electrical-discharge units known as Tesla
coils—there’s a lovely photo-pool of these
machines in action at http://www.flickr.com/
groups/tesla_coil/pool/). Genius though he
was, Tesla didn’t create the utilization, he built
the utility.
Which brings us to data-transmission.
Utility number four
Data transmission—especially via broadband—squares
electricity’s potential. While
AC brought us television and radio, broadband
brings us interactivity via blogs, forums, wikis
and social networking applications. It makes
peer-to-peer file-sharing (which has powerful
legal uses, a fact hyperventilating politicians
and corporate executives sometimes overlook)
possible.
While digital-telecasting, even in high definition,
can be accomplished over the airwaves,
video-over-wire is far more powerful. Ditto for
streaming audio (fire up the “Radio” section
of your iTunes app sometime and try some
browsing). While these uses are basically improvements
on existing media, remember the
pace of change and the inventiveness of human
beings. We’ve only begun to scratch the
surface.
During the heady days of the “dotcom boom,”
is still greatly underutilized. Collectively, we’re on the steep
part of the learning curve
Broadband over Power Lines (BPL)
T
CLP’s Locandro:
one oft-repeated example was the Net-savvy
refrigerator which would magically monitor,
say, milk levels, and order new supplies when
necessary (the tech cynics among us waited
for the first time this apocryphal device would
malfunction and order a case of milk, or perhaps
several cases).
Like most of you, I don’t want my fridge connected
to the Internet and ordering groceries
on its own. But what about a unit that monitors
electric usage and micromanages it for greater
efficiency—while your air-conditioners and
dehumidifiers do the same—and allows onetouch
ordering of deliveries via a biometricidentifier?
Too gimmicky? How about regular
monitoring of a homecare patient’s vitals—data
automatically sent to an authorized healthcare
service? Such a scheme would dovetail with
the Hospital Authority’s plan to create patient
records to support all Hong Kongers.
Standards body
The 4th utility is a vast, sprawling subject, so
the best place to start is with a standards body
The US-based professional association BICSI
(pronounced BIK-see) supports the information
transport systems (ITS) industry. Membership
spans nearly 90 countries, and they
provide a definition of the 4th utility I find apt:
“With information transport systems (ITS)
forming the new fourth utility and the everincreasing
demand for bandwidth, the proper
installation of copper and optical fiber systems
has become paramount,” says their Web site.
“ITS covers the spectrum of voice, data and
video technologies,” according to BICSI. “It
continued on page 16
www.cw.com.hk
April 2009 Computerworld Hong Kong 15

continued from page 15
encompasses the design, integration and installation
of pathways, spaces, fiber- and copper-based
distribution systems, wireless-based
systems and infrastructure that supports the
transportation of information and associated
signaling between and among communications
and information gathering devices.”
Where does Hong Kong rank on this digital
scale, up against connectivity powerhouses
like Korea, Japan and various Scandinavian
countries? According to BICSI, on the Global
Information Technology Report 2008-2009,
produced by the World Economic Forum in
cooperation with INSEAD, the leading international
business school, and sponsored by
Cisco Systems, Hong Kong ranks 12th.
“In general, the transport of data and communications
in a ubiquitous environment is
ever-growing,” said Joe Locandro, director,
Group IT, CLP Holdings. “The two major
mechanisms to achieve this are via wireless
communications with WiFi and into traditional
buildings/home via fiber, copper, ADSL or
even BPL (Broadband over Power Lines). Data
compression algorithms allow effective use of
transmitting data via the above mechanisms.”
(Please see sidebar “Broadband over Power
Lines (BPL)” on page 15 for more information
on this technology).
“The real future will be using the information
highway of both domestic and business users,
using a multiple variety of access methods and
allowing people to connect to the Internet anywhere
anytime,” said Locandro. “Even to the
extent that people can turn on their air conditioners
on before they get home via a Web
page at the office.” The CLP IT expert said
he’d seen working models of this technology
demonstrated in the USA.
Wired flats in Hong Kong
Research firm Gartner has repeatedly said
that consumer tech serves as the blueprint for
tech in the enterprise space. This is often the
Research firm to US President
Obama: invest in fiber-optic
T
case, so it’s worth examining the Soho 38 residential
project from developer Kerry Properties,
a building wired by a variety of vendors
including Cisco, Microsoft, HP, and Hong
Kong-based Home Touch.
“When Home Touch approached us [about
Soho 38], we were surprised,” said Kimmy
Lau, senior marketing manager, Kerry Real
Estate Agency Ltd. “The typical decision-maker
for a flat purchase in Hong Kong may not
be IT-savvy. But we feel that potential Soho
38 flat-buyers aren’t typical, and the technology
we’ve built into the structure will appeal
to them.”
On their Web site, Kerry describes the project
as “the first building in Hong Kong integrating
work, entertainment, communication
and home automation under one platform.”
Data transmission—especially via broadband—squares
electricity’s potential
Much of the tech used in Soho 38 was driven
by CCRE (Cisco Connected Real Estate), a division
of the networking giant devoted to creating
“nerve centers” for new buildings. “Considering
the building itself as a ‘live’ entity is at
the heart of CCRE,” says Cisco’s Web site, in
a case study on Deloitte’s new corporate complex
in Milan. “By harnessing the power of Internet
Protocol (IP) the traditional perception
of the workplace can be overturned. It has the
ability to bring enormous financial and operational
rewards to institutions.”
However, despite the IP ubiquity, much of
the tech going into the project is aimed at
consumers. In-building wiring is Cat 5 copper
rather than fiber-optic. The home control-unit
is from Home Touch, who helped integrate
the HP and Cisco products with their own devices,
according to Kerry’s Lau. The idea is
to provide an overall consumer experience,
which has crossover with enterprise use. For
example, the building has full Wi-Fi connectivity,
a concept pioneered by Cyberport. another
capability that may appeal to enterprises is video-over-IP
security—Soho 38 uses a “portable
video door phone” that captures voice and
video images.
The future
Despite all the progress currently being
made, the 4th utility is still greatly underuti-
16 Computerworld Hong Kong April 2009 www.cw.com.hk

COVER STORY
Power-saving building networks
to get cheaper
Cisco’s Chiu: The Net has become ‘the 4th utility’ as
‘intelligent buildings’ regard communication-related
services as an integral part of the overall infrastructure
lized. Collectively, we’re on the steep part of
the learning curve.
“In view of the acute problems relating to
population growth and unsustainable energy demands,
Cisco has made a commitment to help
address these challenges with CCRE...in essence,
the Internet has become ‘the 4th utility’
as ‘intelligent buildings’ regard communicationrelated
services such as telecommunications,
broadband, security circuits and fire systems
as an integral part of the overall infrastructure
similar to life necessities such as water, electricity
and gas. Indeed, IT plays such a central
role in all of this that it scores very highly in
the ‘Leadership in Energy and Environmental
Design’ (LEED) program, the internationally
accepted benchmark for the design, construction
and operation of high performance green
buildings,” said Barbara Chiu, general manager,
Cisco Hong Kong and Macau.
“Over the years, Cisco has implemented
many CCRE projects locally, such as Cyberport
in Hong Kong, helping them reduce power
requirements and enhance building usage
to provide a flexible foundation for growth,”
added Chiu.
Locandro concluded that “one thing is for
sure: we will live in an interconnected IP
world—from PDAs streaming data to household
appliances having their own IP address.”
Like Tesla and Edison a century ago, we
can’t imagine all the possibilities. But technology
that helps save energy and makes people’s
lives simple and easier is something we
at CWHK support, and will always report on,
whatever stage it’s in.
The maker of components that link millions of sensors and control devices is
launching a new generation of technology designed to make power-saving control
networks affordable for small buildings.
Echelon, a 20-year-old company that developed a now-standardized technology for
these specialized networks, has rolled out a new version that it says is only half as
expensive for its customers to put in their devices. It also can carry incoming data from
many more sources on a network, according to Steve Nguyen, Echelon’s director of
corporate marketing.
Echelon’s LonWorks 2.0 platform updates the whole range of components that the
company sells to makers of devices such as lighting controls, security systems and
HVAC (heating, ventilation and cooling) systems. That includes a processor, a transceiver,
an operating system, and development and installation tools. The transceiver
and processor are set to ship in volume in August, and all the components will be
available by 2010.
LonWorks is based on the ISO/IEC 14908 standard, which allows sensors and
control devices to share a single network and exchange data on a peer-to-peer basis,
according to Nguyen. For example, a thermometer can send a signal that the temperature
in a particular spot has gone over a pre-set limit. An automatic air-vent controller
linked to the same network can interpret the thermometer’s signal and respond by
opening a vent, without having to pass the information through a central computer.
Such mechanisms can now be controlled from beyond the local network using Web
services. One key example of this is “demand response” software operated by energy
providers, Nguyen said. Using a system from a vendor such as EnerNOC, utilities can
send timely information about regionwide demand to individual customers who have
subscribed to the service. Based on that information, devices linked to a control network
can automatically adjust their operations to reduce energy consumption. Together, those
small adjustments may prevent utilities from having to fire up more capacity, Nguyen said.
The ISO/IEC 14908 standard can be applied to networks with a number of different
signaling systems, including fiber-optic cable and wireless. Echelon offers the specifications
for the ISO/IEC 14908 technology openly without a licensing fee, Nguyen said.
About 700 vendors have adopted the technology, he said.
In addition, the more powerful processor offered with LonWorks 2.0 will be able to
support more functions, Hill said. For example, a keypad on the wall for adjusting the
heat or lighting could have a motion sensor, which would cause it to light up when
someone walked up to the keypad. The new modules should also have more capacity
for self-installation programs, which would save engineers having to visit every room
where a module is being set up, Hills said.
No matter how much energy a building-control system may save, one of the biggest
factors in convincing a developer to use it is how long it will take to pay for itself,
Hill said. In terms of energy savings, smart lighting systems can pay for themselves in
three to four years and heating controls in four to five years. LonWorks 2.0 should help
energy-saving systems pay for themselves sooner, he said.
—By Stephen Lawson, IDG News Service (San Francisco Bureau)
www.cw.com.hk
April 2009 Computerworld Hong Kong 17

Banking and finance technology forum packs out venue
It was standing-room-only at a recent banking/finance tech event in Hong Kong
By Computerworld Hong Kong staff
The 5th annual Banking and Finance
Technology Forum Asia 2009 was held
on March 17, which is also Ireland’s national
holiday: Saint Patrick’s Day. The “luck of
the Irish” was with organizers Euro-Events as
the event was absolutely packed—some events
were standing-room-only as people gathered to
hear speakers from the region dispense their
wisdom on the technology driving financial
services.
Experts discuss optimization
A lively panel discussion on the subject of
“Competing in a Turbulent Marketplace: CIO’s
Agenda for Year 2009” was moderated by Vincent
Chan, partner, Technology and Security
Risk Services, Ernst and Young.
Michael Leung, SVP and CIO, China Construction
Bank (Asia), spoke of the differences
in banking today, with varieties of experiences
in retail banking. “I sometimes wonder if there’s
still any room for banks to make some money,”
said Leung. “We’re expending a lot of money
and effort to follow compliance regulations,”
but, he said, many new rules and processes were
confusing—such as the need to have a younger
person to accompany elderly customers when
purchasing certain investment products.
Leung also mentioned the need for centralization
of back-office processes. “Our cost-cutting
is brutal,” he declared. “For instance, we plan to
add 10 new branches while keeping the bank’s
headcount at roughly the same level. We now
have automatic shut-off of PCs at [approximately]
9PM each day, and if you need to work late,
you have to pre-register.”
The CCB executive said his firm no longer
pays OT as a normal practice. “And paper-use is
to be cut drastically,” he said, “it doesn’t matter if
you print one-side, two-side, whatever.”
“I don’t think there’s a CIO out there, in any industry,
who’s not using outsourcing,” said Alpesh
Patel, Regional Head of IB IT, APAC, UBS (Hong
Kong). “Our firm is going into virtualization, but
it’s not quite there yet, even though the vendors
will tell you it is. Your infrastructure is sitting out
there at 10-15% [utilization], but at market-close
it’s 90%, so you need it.”
“Unless you’re in this industry, you won’t believe
the need for storage: every Powerpoint [presentation]
or other data must be kept for years,”
he said. “[And] because of security breaches, offsite
storage must be encrypted.”
Leung said it was ironic that “in a few cases,
regulatory compliance and cost reduction work
well together. For example the HKMA [Hong
Kong Monetary Authority ]and the PDPO [Personal
Data Privacy Ordinance] say you should
retain your customers’ data for seven years, but
no longer. Seven years [plus] one day is unnecessary
and strictly speaking illegal! So by purging
older data from databases we’ve been able
to curtail our storage growth rate while staying
fully compliant.”
Vendor discounts
“With the buying power we have, we can get
excellent discounts from vendors these days,”
said Leung. “We can also find great talent now in
the job market, such as branch managers.”
David Lau, head of IT, Kim Eng Securities
We plan to add 10 new branches while keeping the bank’s
headcount at roughly the same level
— Michael Leung, China Construction Bank (Asia)
Hong Kong, agreed with Leung. “This is the best
time to look for new talent,” he said. For vendors,
said Lau: “It’s a great time to approach companies
with new deals.”
“Even in this job market, the best people command
a premium,” said Patel. “For vendors,
you’ve got a contract, but it needs renewal, so
prepare to be flexible. On the vendor-side, don’t
lose heart: we’re both in roles where we’ve both
been successful, if we keep a long-term view, we
can keep it going.”
Financial trends have shifted drastically, noted
Leung. “As a mainland bank, we are now manu-
Patel from UBS:
facturing our own investment products—bonds,
structured notes—because people no longer believe
in those big names overseas anymore,” he
said.
“As for our bank, products have become simplified,”
said Patel. “The buffet is gone—now you
get the menu, and you look in your pocket to see
who much money you have.”
Ensuring exchanges
Ian Tan, regional sales director for Asia, Tumbleweed
Communications (now merged with
Axway), gave a presentation on “Compliance and
Data Security on File Exchanges in Financial Institutions.”
Tan pointed out that the patchwork of legacy
systems, connected by FTP scripts of various
vintages, can’t meet new security requirements
such as the PDPO.
He said that “we hear horror stories of customer
data being leaked” in Asia, there’s not necessarily
legal necessity to publicize leakage, so we
may only hear about it when the media gets the
information.
Tan added that the means of file transfer between
clients and the enterprise network are
many and varied, and that cash management systems
demanded scalability and security.
Computerworld Hong Kong April 2009 www.cw.com.hk

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Jim Longwood
Asia’s top 10 locations for offshore IT services
The impact of the economic downturn is
driving companies to consider moving
their IT services to lower-cost locations.
However, determining where to host such operations
is a daunting task for many organizations.
Gartner assessed the suitability of A-Pac countries
as offshore locations and identified “10
Leading Locations for Offshore Services in Asia
Pacific for 2009.” These included the undisputed
leader in offshore services (India) and the greatest
challenger in terms of potential scale (China).
The rest are a mix of mature environments that
offer limited cost-benefits (Australia, New Zealand
and Singapore) and emerging countries
with a variety of challenges, but attractive costs
(Malaysia, Pakistan, the Philippines, Thailand,
and Vietnam).
Although India continues to grow in top-line
revenue levels of IT services being exported, its
share of the overall worldwide totals has declined
as other countries are investing to gain more market
share. Enterprises seek strategies to reduce
risk, and India faces challenges. These include
wage inflation, local attrition rates, geopolitical
issues (including the Mumbai terrorist attacks)
and the “Satyam Effect.”
Despite increases in investment, infrastructure
remains India’s biggest weakness—
strained power capacity and inadequate connectivity
remain challenges. Some IT service
categories such as application outsourcing
have matured and the level of incremental
growth is smaller.
The Philippines generates considerably more offshore revenue
than China...the country has a history of providing services to
the US and Asian markets
Testing methodology
What about China?
Alternatives in the Asia Pacific region? Gartner
analysis shows a number of countries positioning
themselves as credible alternatives.
China is attracting great interest. But it still has
challenges to buyer confidence: security, quality
and intellectual property issues, relatively low
English-language capabilities, and a scarcity of
middle managers.
A large portion of the current market is geared
to R&D-embedded engineering services, which
differ significantly from commercial enterprise
buyer requirements. Thus, there is a need to
build strong process and quality maturity for delivery
of IT services to commercial enterprises.
Marketing skills across the value chain of the
outsourcing industry are still immature, which
results in a lack of information access and authenticated,
verified sources of data for decisionmaking.
Organizations wishing to engage China
today should plan and budget for more-substantial
levels of project management, change management
and governance requirements, given
the immaturity of the market.
Where else then?
The Philippines generates considerably more
offshore revenue than China. The country has a
history of providing services to the US and Asian
markets. Some IT services have been exported
for more than 15 years. It’s now a key outsourcing
destination for call centers, finance and accounting.
English continues to be the predominant language
in the country and the level of accent
neutralization required is relatively low—significantly
lower than in India and China. It has a
good labor pool that’s scalable at low cost and its
overall cost structure is lower than India’s. Wage
inflation and attrition ratios are also lower.
When considering the Philippines as an offshore
location, companies must be sure to establish
adequate risk mitigation measures around
intellectual property protection, security and
privacy. They should also ensure they are comfortable
with specific technology and industry
knowledge before signing a deal.
Companies seeking to be pioneers in a large
and untapped low-cost destination should investigate
Vietnam. Opportunities exist, but rigorous
due diligence is required. Salaries of IT and business
process professionals are among the lowest
in the world. Consequently, Ho Chi Minh City
and Hanoi are attracting a good deal of interest
from major IT companies. Both IBM and CSC
have made substantive investments in setting up
global delivery centers in the country.
However there are some major challenges,
which include a significant lack of awareness
of key business practices and operating norms,
and few known vendors. Reliable information regarding
Vietnam is scarce, and difficulty in doing
business in Vietnam from a logistical and funding
perspective is a key hurdle.
Companies should think carefully before allowing
the excellent cost base to overly influence
their choice of Vietnam as an offshore destination.
Understand all the risks, including hidden
costs, risks related to data security, ease-of-doingbusiness
issues and relatively low-level Englishlanguage
skills.
Tread carefully
In the current economic climate there are
definite advantages in moving IT services offshore.
But organizations and vendors eyeing
any of the 10 Asia-Pacific countries in the Gartner
report should understand that each country
in the region is quite a different market in
which to operate, particularly if companies are
considering doing local business as well as offshore
business.
Jim Longwood is a Gartner
research vice president based
in Melbourne. As part of both
the Asia/Pacific and global IT
services teams he is responsible
for undertaking research on
sourcing best practices, trends
and market positioning of
external service providers in the Asia/Pacific IT
services market
20 Computerworld Hong Kong April 2009 www.cw.com.hk

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Peter Bullock, Pinsent Masons
Security breaches: leaning on the suppliers
It seems unlikely for a health authority to blame
a hardware-supplier for data leaks caused by
one of the authority’s own employees misusing
a USB stick. Yet there are many occasions
where suppliers—or their subcontractors—have
been directly responsible for a security breach.
The rise in these incidents (coupled with media
reportage) has led to significant changes in commercial
contracts covering the handling of sensitive
data as well as the balance between data
owners and their suppliers.
Vague responsibilities
The Personal Data (Privacy) Ordinance (PDPO)
implicitly requires that organizations load their required
security standards onto third party suppliers.
In the past, organizations preparing contracts
for IT projects have attempted to abdicate responsibility
by putting a boilerplate (standardized-text)
provision in the contract which states that the supplier
will do what is appropriate regarding security.
In the event of any security breach, contractual
disputes are a certainty.
Despite general awareness that security obligations
must be passed to suppliers, there is a
lack of audit processes and assurance processes
in relation internal and external security. Third
parties with access to an organization’s data, particularly
suppliers, are not subject to any form of
order or review.
The law has remained static but regulatory responses
and media reaction have changed radically.
Audit and assurance procedures have become
a key issue on the boardroom agenda in many
organizations—as opposed to 12 months ago.
Regulatory consequences and adverse PR
consequences mean that organizations must
boost their efforts in this area. They must decide
whether their real world controls for the transfer
of personal and confidential information to third
parties, particularly suppliers, are effective.
A tipping point came recently in Hong Kong
when both HSBC and the Health Authority revealed
serious security breaches within days of
each other, attracting substantial media attention.
Now both public and private sectors recognize
that this issue requires revision, allocation
of resources, and be escalation up risk registers
within organizations. People now understand
that this is not a mere compliance issue but a
time-bomb that can damage the reputation of a
business and ultimately the bottom-line.
Guarding the gates
Organizations are no longer satisfied with boilerplate-text:
they demand a project-specific information
security plan with specific controls and
safeguards which respond to the specific risks
identified. When standard practice evolves, consumer
expectations change and interpretation of
security guarantee
the PDPO changes because what’s appropriate
today might not be appropriate tomorrow.
We’re seeing large organizations across many
sectors—including energy, financial services,
retail and the public sector—examining their
supplier-selection process and how they identify
information security risk within the supplier
base.
Internal audit departments and group security
departments are examining contracts to vet supplier
performance. Is the objective to mitigate,
manage and control real world security risk?
How does having “perfect contract” accomplish
that? Yes, liability issues might be covered so
you may not end up paying the bill if a security
breach occurs, but in that unfortunate event it
may be your firm’s brand and reputation on the
line and it may be you personally explaining to
the CEO why it happened.
Set your standards
Project Specific Information Security Risks
and Controls should be drawn from ISO standards
or other appropriate international standards.
It is important to note that ISO standards
are not a panacea. They are a set of control objectives,
control statements and controls which
organizations draw upon to manage real world
scenarios.
It’s not enough to assure a supplier you will
comply with ISO requirements. You must identify
risks, what controls will manage and mitigate
those risks, then specifically require the
supplier to implement those controls. But during
this process, both parties must recognize
that this is not a black and white issue.
Implementation of controls may not be enough
to achieve absolute security and no organization
can expect a supplier to give an absolute security
guarantee.
Security costs
This degree of process does not come cheap.
Producing project-specific risk analyses, coping
mechanisms, and security audits, especially on
a substantial IS (information security) project,
consume thousands of man-hours of consulting
resources. And these projects often take years
to complete.
The landscape for contractual requirements
surrounding security provisions has changed
so radically and so rapidly that what now seems
like common sense and best practice to procurers
of IS projects doesn’t match the contractual
requirements those procurers signed their suppliers
to, on the same project, 18-24 months previously.
Much to their annoyance, these procurers
are now finding that their suppliers are making
claims for the work associated with “state of the
art” security arrangements, by way of change
controls. Sometimes the figures involved are
quite staggering.
Security is no longer boilerplate.
Peter Bullock, a technology lawyer,
is a partner with Pinsent
Masons in Hong Kong and can
be contacted at peter.bullock@
pinsentmasons.com
22 Computerworld Hong Kong April 2009 www.cw.com.hk

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Steve Tunstall
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Local online marketing intelligence firm to go global
As the downturn deepens, online marketing becomes increasingly important
for Hong Kong, says Admomo’s founder and director Winston Law
By Teresa Leung
WL: At the moment our customers come from
Asia Pacific. They include portal sites and gambling
companies.
CWHK: How much does it cost to use your services?
WL: For Hong Kong data only, it costs HK$40,000
a year for one account. Australian data costs
HK$80,000 annually because there are about 600
publishers in the country, which is a higher number
than Hong Kong.
CWHK: How much have you invested in
R&D?
Admomo’s Law (left) and CTO Felix Ng: We aim for 2,000 customers in two years
CWHK: Why online marketing intelligence?
Winston Law: Nowadays we see more companies
with online marketing strategies. This trend
is more obvious when businesses are affected by
an economic downturn because online media is
low cost, interactive, and provides measurable
ROI.
According to survey results announced by Nielsen
Media Research earlier this year, Internet media
budgets are expected to increase from 6 percent to
8 percent. However, the average budget of each advertiser
will fall to HK$17.8 million compared with
HK$20.4 million last year.
At the same time, advertisers want to know the
most effective online advertising platform, what
their rivals are doing online and how much they
spend, as well as online advertising trends in particular
industries. An online marketing intelligence
service provides answers to all these questions.
CWHK: How many Web sites are offering advertising
space in Hong Kong?
WL: There are already more than 200 publishers.
We call Web sites that offer advertising
space “publishers.” In 2008, there were more
than 4,000 advertisers (excluding Google ads)
and more than 10,000 campaigns valued at more
than HK$600 million.
CWHK: When was the company founded?
WL: Admomo was founded in 2007. We have a
team of 30 people. Our Hong Kong office is Admomo’s
R&D base while the content team in
Shenzhen is responsible for inputting content
like advertising slogans, which then become
searchable data for our customers.
Our crawler automatically searches for new campaigns
and updates the server. But data like slogans
must be compiled and presented manually in a format
friendly to users.
CWHK: Who are some of your competitors?
WL: The major one is AC Nielsen. Including us,
there are only three companies that offer global
data [about online advertising campaigns].
CWHK: How do you differentiate?
WL: Admomo’s user interface is user-friendly.
Our data are organized according to industry,
advertiser, products, and publishers. Many of
our rivals only show banner images, which aren’t
useful to users.
We also provide product/campaign comparison
while our competitors don’t and their customers
have to consolidate reports manually for comparison.
Our products are [available] both in English and
the local languages used in markets where we have
presence. We also team with Alexa which provides
traffic data and offer customers more detailed campaign
and/or traffic comparison.
CWHK: What is your partner strategy?
WL: Besides traffic data providers like Alexa, we
want to work with channel partners overseas.
CWHK: Who are your customers? Are most of
them from Hong Kong or overseas?
WL: Around HK$1 million. We are also in the process
of applying for funds from the Small Entrepreneur
Research Assistance Program (SERAP)
offered by the Hong Kong government’s Innovation
and Technology Fund.
CWHK: How’s the Hong Kong online advertising
market different from others?
WL: Hong Kong firms are conservative when it
comes to online campaigns. Despite increasing
spending in online ads, Hong Kong is still behind
markets like Australia and Japan where online
campaign budgets are more than 20 percent of
their marketing spending.
CWHK: What’s the range of online campaign
costs in Hong Kong ?
WL: They range from HK$4 to HK$230 for every
1,000 impression.
CWHK: What’s your targeted customer base?
WL: 2,000 customers worldwide in two years.
CWHK: What’s your expansion plan?
WL: We will launch our service in China in
about two months, and in Australia, Singapore,
and Taiwan at a later stage. We plan to
cover 10 countries within this year and 15 by
mid-2010.
CWHK: How much will this expansion plan
cost you?
WL: We will only need to add a few people to our
content team. I don’t think it will jack up our cost
significantly.
24 Computerworld Hong Kong April 2009 www.cw.com.hk

Helping the tough get going
Microsoft showcases a host of technologies aimed at helping businesses
survive the economic downturn by ‘doing more with less’ at the Achieve
More Summit By Jason Krupp
Microsoft recently held a one-day conference
in Hong Kong as part of their
Achieve More campaign, which aimed
to help Asian businesses weather the current
economic downturn.
The conference consisted of two sessions
which focused on enterprise-level companies and
SMBs respectively.
The enterprise session was opened by Adam
Anger, senior director of the Microsoft business
& marketing organization Hong Kong, who noted
that during tough times such as these companies
often demand that IT help drive profitability
on one hand, while cutting the budget with the
other.
This paradox was summed up neatly by the
phrase ‘doing more with less’ by Anger.
“There is a lot of pressure both internally and
externally in terms of how we manage businesses
in tough times, and I think that presents a role
—a great opportunity—for leaders in IT to figure
out how their businesses can mange through the
tough times,” said Anger.
Transforming to survive
Following on from Anger was Enrico Benni,
partner and head of greater China business practice
at McKinsey & Company, who shared some
of his view on how CIOs must adopt a number of
new roles in addition to their traditional ones if
Benni:
their organizations are to weather the crisis.
These five roles include: adopting a corporate
finance role by finding new sources of cash for
the business; becoming a broker between the
business units to assess which projects to drive
and which to drop; communicating to the organization
the value of a project; preparing the organization
for upstream regulatory changes in the
business space; and lastly a driver of outsourcing
and offshoring.
What these roles highlighted, according to
Benni, was the fundamental need for businesses
to change their operating model if they are to
survive.
“If you look at companies that were leaders
before the previous downturn, and the ones that
were still leaders after the downturn, what you
see is that half have changed position,” noted
Benni.
“What you see in the companies that remained
leaders is that they have fundamentally taken the
opportunity from the downturn to rethink how
they operate.”
And this, he said, is where IT can play a significant
part, specifically in three main areas:
improving business efficiency by streamlining
processes and the cash conversion cycle; driving
smart growth by leveraging internal synergies
through CRM that were not possible in boom
times; and finally—and most importantly—strategy
transformation.
“Companies can view the crisis as a time to
stay put, survive and come out and be the same
company as you were before. For some that is
the right strategy,” said Benni.
“However, some companies are fundamentally
taking advantage of the crisis to become the new
leaders. This requires thinking about transformation
and new ways of operating. The people
who are working in the CIO community have to
think about these roles and be prepared to assume
these roles in your company and be much
more positive.”
End-to-end view
John C Phillips, enterprise technology strategist
for Microsoft, followed on from Benni, and
explained exactly how CIOs can do more with
less using the Microsoft platform.
He started by asking attending IT leaders to
classify where their operations fall on the value
Phillips:
chain in their organization, stating at the bottom
with ‘fighting fires’, moving to ‘gaining control’,
then ‘business enabler’ and highest of all, ‘viewed
as a strategic asset’.
“The reality is that 80 to 90% of customers in
Asia are still in the ‘fighting fires’ mode,” said
Phillips.
“It has been identified across a number of
analyses and surveys that the management cost
per PC per user is about HK$14,000 per year—
that is in the fighting fires mode. If we can move
you more to ‘business enabler’ or even ‘gaining
control’, you can drop this number by 10 to 20%
per PC per year. That is money back in your
pocket.”
Phillips identified a number of key technology
areas where he says Microsoft can help customers
move up the value chain, namely business
intelligence (BI) and Customer Relationship
Management (CRM), collaboration and unified
communications and virtualisation and IT management,
which link into a interconnected platform.
This was showcased using live demonstrations
from Microsoft solution specialists, who looked
at Microsoft BI, SharePoint, Office Communications
Server and Windows Server.
To close, he urged customers to look into how
they can use their existing infrastructure, and
link it into a single platform to drive transformation
through their business.
“I urge (customers) to do more with what
you’ve got. In many cases you’ve got the technology
already. Now upgrade and get the benefits
and the value,” concluded Phillips.
Speaker presentations and more information
can be found at: www.microsoft.com/hk/
achievemore
26 Computerworld Hong Kong April 2009 www.cw.com.hk

industryevent
Driving IT to deliver full value
Five technology leaders shared their insights into how businesses can leverage existing
capacity to help them navigate through the current economic slump
By Jason Krupp
Last month, at Microsoft’s Achieve More
Summit, CIOs and IT industry executives
sat down for a panel discussion to highlight
some of the challenges they are facing with
the slowdown in the global economy, and how
they are using Microsoft technology platforms to
navigate around this.
Despite the gloom, the panel cautioned technology
executives that the key was not to focus on
the negative effects of the economic downturn,
and instead focus on ‘clean-up’ and consolidation
projects that might have been considered ‘handsoff’
during the good times.
“The mantra for many boards for many years
has been work ‘smarter rather than harder’. The
only problem with that is that people were making
a lot of money to satisfy shareholders (in the
boom), and were basically resistant to change,”
said Patrick Slesinger, director and CIO at Wallem
Innovative Solutions.
We are now able to do a number of programs
which were perhaps considered too disruptive
to the business while in the boom
– Patrick Slesinger, Wallem Innovative Solutions
“Now, with the economic crisis, what we have
is people fearing for their company’s survival,
and they are willing to take quantifiable risks. We
are now able to do a number of programs which
were perhaps considered too disruptive to the
business while in the boom. This is the time IT
can really help the business.”
Blood from a stone
The panel noted that one of the main areas in
which IT can help is in driving efficiencies and
productivity within the organization, and position
it for rapid growth once the economy recovers.
The challenge for IT leaders lies in getting
capex-shy boards to see the value of investing in
projects that will help them achieve this.
One of the ways most effective ways identified
to do this was by making use of what companies
already have.
“Many people don’t want to spend any more
money, but the reality is that a lot of them have
Patrick Slesinger (left) and Avi Raju (right) discuss the possibilities of IT taking on a driving role in navigating business
through the recession.
invested in systems and architecture for many
years,” said John C Phillips, enterprise technology
strategist for Microsoft.
“We still find that in many cases customers
haven’t 100% deployed what they own, and so it’s
about investigating what
they’ve got and find ways
to use it better.”
Enrico Benni, partner
and head of greater China
Business Practice at
McKinsey & Company,
noted that CIOs need to
aggressively defend their
budgets with sound business
reasoning in order for it to resonate with
senior management.
“We see people cutting costs on IT purely to
generate a bit more cash but this does not bring
them what they need. There is a calculation that
if you cut IT cost by 15% your impact on EBITA is
only 0.5 percent,” noted Benni.
“However, if you invest in IT your turnaround
could get back double or 10 times what you
invested in the first place. So I think there is
a fundamental role for the CIO here, to help
people step up and understand that transformation
is a lot more than just cutting the project
budget.”
Pitch the right project
It was also pointed out that corporate purse strings
are not completely sealed if the right project.
“I think boards are actually quite open to initiatives
on transformation right now,” said Avi
Raju, Director of Asia Information Technology at
Savills, where the recent focus has been on virtualizing
its server environment, creating better
processes and strengthening its CRM platform.
“You should not only look at internal processes,
but also at your competitors and see how they
are placed, what their market share and profile
is and how you can benefit. I think if the right
proposition is put to the board and leverages existing
infrastructure, they will be quite open to
spending on it.”
Benni also pointed out the appeal of implementing
CRM solution right now. “Look at sharing
of customer data across the business units,
something that was very hard to do in the growth
market,” said Benni.
“Right now there are pricing benefits if you can
share this information and put more transparency
in place between the business units, allowing
you to cross sell and up sell.”
Slesinger pointed out that the focus of ERP
systems had now moved beyond process engineering,
and into outsourcing and offshoring to
reduce costs and drive efficiencies.
It was also noted by the panellists that unified
communications platforms are increasingly being
seen as a means to reducing costs and improving
productivity, a strategy that some companies are
employing to drive better collaboration and also
save on travelling to meetings.
Microsoft’s Phillips summarized the discussion.
“You can take a lot of advantage of the
technology you already have in place, and start
to bring together business information and make
smarter, more collaborative decisions,” he said.
“And it’s not always about huge reinvestments in
technology.”
www.cw.com.hk
April 2009 Computerworld Hong Kong 27

technews
Fatal flaw for IPv6: It’s not backwards compatible
The Internet engineering community
said its biggest mistake in developing
IPv6—a long-anticipated upgrade to the
Internet’s main communications protocol—is
that it lacks backwards compatibility with the
existing Internet Protocol, known as IPv4.
At a panel discussion held in San Franciso
last month, leaders of the Internet Engineering
Task Force (IETF) admitted that they
didn’t do a good enough job making sure native
IPv6 devices and networks would be able
to communicate with their IPv4-only counterparts
when they designed the industry standard
13 years ago.
“The lack of real backwards compatibility for
IPv4 was the single critical failure,” said Leslie
Daigle, chief internet technology officer for the
Internet Society. “There were reasons at the
time for doing that...but the reality is that nobody
wants to go to IPv6 unless they think they’re
friends are doing it, too.”
Originally, IPv6 developers envisioned a scenario
where end-user devices and network backbones
would operate IPv4 and IPv6 side-by-side
in what’s called dual-stack mode.
However, they didn’t take into account that
some IPv4 devices would never be upgraded
to IPv6, and that some all-IPv6 networks would
need to communicate with IPv4-only devices or
content.
IPv6 proponents said the lack of mechanisms
for bridging between IPv4 and IPv6 is the single
Salesforce.com is working to integrate its
Service Cloud customer-service platform
with the popular messaging service Twitter,
the company said recently.
Salesforce CRM for Twitter, now in beta, will be
available this summer at no additional charge for
Service Cloud users.
Launched in January, the Service Cloud combines
concepts like online customer communities,
social networking, knowledge base information,
and making data from cloud services
like Facebook and Twitter available to e-mail,
phone and chat-based customer service representatives.
While there’s nothing stopping a salesperson
from simply using Twitter directly, the integration
pulls relevant Twitter conversations into
the Service Cloud and allows users to reply directly.
In a demonstration of the new capability, Salesforce.com
showed how someone working for a
telecom provider could spot and track a discussion
biggest reason that most ISPs and enterprises
haven’t deployed IPv6.
“Our transition strategy was dual-stack, where
we would start by adding IPv6 to the hosts and
then gradually over time we would disable IPv4
and everything would go smoothly,” said IETF
chair Russ Housley, who added that IPv6 transition
didn’t happen according to plan.
In response, the IETF is developing new IPv6
transition tools that will be done by the end of
2009, Housley said.
“The reason more IPv6 deployment isn’t being
done is because the people who are doing the
job found that they needed these new transition
tools,” Housley said. “These tools are necessary
to ease deployment.”
IPv6 is needed because the Internet is running
out of IPv4 addresses. IPv4 uses 32-bit addresses
and can support approximately 4.3 billion individually
addressed devices on the Internet. IPv6, on
the other hand, uses 128-bit addresses and can
support so many devices that only a mathematical
expression—2 to the 128th power—can quantify
its size.
Experts predict IPv4 addresses will be gone by
2012. At that point, all ISPs, government agencies
and corporations will need to support IPv6
on their backbone networks. Today, only a handful
of US organizations—including the federal
government and a few leading-edge companies
like Bechtel and Google—have deployed IPv6
across their networks.
Salesforce integrates service cloud with Twitter
about a headset that a user was having trouble
with. The telecom worker could dig through their
company’s internal knowledge base and then send
the Twitter user a link to a help document.
Salesforce is using the beta period to fine-tune
the integration’s performance and feel, according
to a Salesforce.com spokesman.
One industry observer called Salesforce.com’s
move “incremental” but “interesting.”
“Salesforce is showing that perhaps the best use
of social networking is perhaps on the service side of
CRM [customer relationship management] and not
sales force automation,” said Rebecca Wettemann,
vice president, research, at Nucleus Research.
“The immediate advantage of this is for companies
whose audience is teenage girls,” she added.
“They’re constantly Twittering.”
But before companies get enamored with the
“next shiny thing,” which could be Twitter, they
need to mull over the potential return on investment,
she said.
—Compiled by CWHK staff
newsbytes
Hong Kong
NTT Com Asia opened its new seven-story data
center building in Tai Po, Hong Kong in late March.
The facility has a gross area of up to 212,100
square feet and can provide more than 3,000 racks,
said NTT Com Asia. The data center has been built
to achieve the Tier III+ infrastructure level, NTT
Com Asia said, adding that every aspect of its
facilities, including power, cooling, and telecommunications
systems are fully redundant to avoid
single point of failure and to ensure business
continuity.
Hong Kong security info watchdog
heads APCERT
The Hong Kong Computer Emergency Response
Team Coordination Centre (HKCERT) has been
elected as the chair of the APCERT (Asia-Pacific
Computer Emergency Response Team) recently
during the annual general meeting held in Kaohsiung,
Taiwan. This is the first time that Hong Kong
heads the APCERT comprising 22 leading and
national Computer Security and Incident Response
Teams (CSIRT) from 15 economies of the Asia
Pacific region, said the Hong Kong Productivity
Council that manages the HKCERT established in
2001.
Novell unveiled SUSE Linux Enterprise 11 in late
March, with features and capabilities that reflect
the company’s controversial multiyear agreement
with Microsoft. In 2006, Microsoft and
Novell agreed to work on improving compatibility
between their products, and pledged not to pursue
patent claims against each other’s customers.
Novell said SUSE 11 will work “seamlessly” with
Windows regarding areas like systems management,
virtualization, document formats and even
multimedia.
with Cisco tools
Cisco announced recently that Hong Kong-based
pay TV operator i-CABLE is deploying Cisco’s
set-top boxes and video system to fight pirated TV
viewing. The Cisco products that iCable is deploying
consists of the Model D-PCG1000 PowerKEY
Conditional Access System (CAS) Gateway, a digital
headend system incorporating the Continuum DVP
SI-Server MKV, ROSA Copernicus Network Management
Server (NMS), Model D9630 Advanced QAM
Modulators and DCM Digital Content Manager, and
the Cisco’s Z368DVB Standard-definition (SD) settop
series, which includes options for both digital
cable and MMDS/satellite.
Computerworld Hong Kong April 2009 www.cw.com.hk

Microsoft teams with Cyberport
to support local start-ups
As tech-related vacancies are dropping, it’s time for IT pros to think
about starting their own businesses By Teresa Leung
Tired of the job search? Want to test your
entrepreneurship? The BizSpark creativity
center of Microsoft might help you get
a head start.
The software vendor announced an initiative
to support Hong Kong digital content and entertainment
start-ups, as part of its global BizSpark
program. By teaming up with Cyberport’s Incubation
program dubbed IncuTrain, the BizSpark
program in Hong Kong provides start-ups with a
range of resources including software, technical
support, marketing, and office space.
According to Microsoft, the program is open
to privately held start-ups that build digital entertainment
and creative lifestyle content-based
products or services. These firms must be in
It’s time to develop your
products now—don’t wait
till the arrival of the upturn
— Leung from Microsoft
business for less than three years and have less
than HK$7.8 million in annual revenue.
“The economic downturn is a good time for
[entrepreneurs] to start their own businesses,”
said Simon Leung, chairman and CEO of Microsoft
Greater China Region. “We estimate the
economy will see improvement two years later.
It’s now the right time to develop your products
now and capture market and growth opportunities
when the upturn arrives.”
The vendor added that the software support
amount from the BizSpark program will vary according
to how start-ups architect their products.
But it can be as much as HK$2 million based on
a standard five-person software company, Microsoft
noted.
Leung said that program participants are expected
to graduate in three years’ time.
Asked why Cyberport rather than Hong Kong
Science Park’s incubation program is a better
place for digital content players, Nicholas Yang,
CEO of Hong Kong Cyberport Management said,
“Cyberport ‘s (incubation) program is dedicated
to digital media, content, and entertainment
while Science Park’s program is open to firms in
Microsoft’s Leung:
multiple areas including IT and biotech.”
According to Leung, Microsoft already
launched the BizSpark program in China last November
and worked with various science parks
in the country to facilitate development of startups.
He added that the company will bring the
same program to Taiwan at a later stage.
Appointment news
Number of new tech jobs drops
37.6 percent in Hong Kong
Freddy Tan
Freddy Tan appointed to
(ISC) 2 board of directors
T
2 .
director of greater China
responsible for business development in
30 Computerworld Hong Kong April 2009 www.cw.com.hk

ANNIVERSARY covering Hong Kong technology since 1984
CHANGE
Yes we can help
2008 is a year of changes - Staff Termination,
New Join, Transfer & Promotion.
So it is time to update your database
and prepare for the challenges ahead.
Computerworld HK can Help.
CWHK Database Management Services
Manage profitable relationships with existing
and potential clients
Outbound call for data cleansing
Customer Acquisition / Retention /
Customer Care Program
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For enuiries, please contact Connie Yip, Account Director
Tel: 2589 1373 or Email: cyip@questexasia.com
technews
techguide
techfeature
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industryprofile

ANNIVERSARY covering Hong Kong technology since 1984
Declining markets across the board still provides opportunities for leaders to shine among the gloom
While CWHK prepares for
another annual awards
in June 2009, the industry’s
vendors are still reeling from
a 2008 that looked initially positive
but ended rock-bottom. And the
news is that 2009 will be worse than
expected with Gartner predicting a
decline in global IT spending by 4%.
That means a greater contraction in spending
than the dot com bust in 2001. “The IT market
slowdown will be worse than 2001, that downturn
was tech-related. Today there is a general
slowdown in demand for products and services
across the board and IT spending is not
immune,” said Richard Gordon, research vice
president of global forecasting at Gartner, on a
conference call announcing the spending forecast.
Gartner reported that global IT spending will
reach about US$3.2 trillion in 2009, a 3.8% decline
in growth from the $3.3 trillion spent in 2008. IT
spending in 2001 saw a 2.1% decline, according
to Gartner.
Spending on hardware is expected to fall by
a staggering 14.9% to $324.3 billion. Software
spending, which was supposed to be a relatively
bright spot, is now seen as growing only threetenths
of one percent, to $222.6 billion in 2009,
and IT services is expected to decline by 1.7% to
$796.1 billion. Telecom and network spending,
which is the largest part of the IT budget, is going
to decline by 2.9% to $1.89 trillion.
Networks
Complexity is the dominant factor in networks
today and how companies can best manage it
will be the secret to a high performance network.
Functions are being added constantly while traffic
loads are not slowing in growth leaving network
managers struggling to cope. There are more security
functions being integrated at the network
and applications such as telepresence and unified
communications add even further QoS demands.
On the application side as data centers are
consolidated, the dependence on the network to
deliver consistent user experience and reliable
application performance is becoming critical. All
locations and branch offices demand consistent
service levels for their applications and they want
it all secured. Vendors that can ease the management
burden during such difficult times and enable
the customer to deliver consistent services
levels will be stand a good chance of succeeding
this current market.
Security
Security is perennially in the top three priorities
for IT departments but during a recession
the risks posed to organizations become even
greater. Cybercrime as in the physical world becomes
rife during downturns. Malicious and targeted
threats will without doubt be on the rise as
will the creation of malware and exploitation of
weakpoints. Data protection is now a major priority
as companies realize that protecting users and
their devices is not always realistic but protecting
the data will in turn protect the company.
Internal threats become an even bigger issue
as disgruntled existing and ex-staff have much
higher motivation to take action against their
companies. Again for providers in security there
will be a heavy emphasis on easing management
and also finding ways to deliver security metrics
as budgets are squeezed and all investments
scrutinized more stringently.
Applications
In the applications market, there is a high level
of attention on the business intelligence and
CRM space. Improving the use of existing data
as well as capturing new data is a huge concern
as business leaders try to drive greater productivity
and squeeze more value from staff and
from customers. Finding the best resources to
maximize the value delivered to customers can
be optimized by business intelligence and analytics
tools.
CRM will be leveraged to maximize existing customer
relationships as firms turn to focus on customer
retention strategies rather than acquisition.
The other major trend is cloud computing. As
this moves out of the hype phase, firms are now
evaluating the possibilities of moving more resources
into the cloud and applications seems
a good first step. Application vendors that are
able to articulate this development clearly and
also deliver as promised will find growth in this
area.
Services
There are clear arguments for how managed
services will benefit in a downturn. The
problem many firms face is finding enough
examples of services which provide the short
term return that is demanded by businesses
today. Security services, application management,
network management are all areas with
huge potential as firms want to shift the management
burden to third parties and away from
internal resources.
However while companies are taking an interest,
beyond some basic services, adoption is not
as fast as predicted.
32 Computerworld Hong Kong April 2009 www.cw.com.hk

Computerworld Hong Kong Awards 2009
This year we have a total of 47 categories
with a record number of entry
nominations. The following list shows
all final nominations as included in the voting
form which is NOW LIVE. Fully-subscribed
readers can still vote by going to our web site
and clicking on the “awards section.”
exclusive CWHK Photo Album key chain.
allowed to vote. (VENDORS, SYSTEMS IN-
TEGRATORS, DISTRIBUTORS/RESELL-
ERS not accepted).
and furnish us with their contact details
will qualify for winning a prize. All winners
will be notified by phone/email individually.
bers
are not eligible for the vote.
the final decision should there be any
disputes.
HARDWARE:
Mid-Range Server (50-200 users)
Dell PowerEdge Servers
Fujitsu Primergy Servers
HP ProLiant Server
IBM Power Systems
Lenovo ThinkServer R & T Series
Sun SPARC Enterprise T5440
Teradata Data Warehouse Appliance 2550
Enterprise Server (201+ users)
Fujitsu Primergy
Dell PowerEdge M-Series
HP Integrity Server
IBM System z
Sun SPARC Enterprise M9000 Server
Teradata Data Warehouse Appliance 5550
Datacenter Power Systems
APC Symmetra PX
Chloride UPS
Emerson Liebert UPS
HP Power Manager
Datacenter Cooling Systems
APC InRow RP Cooling
Emerson Liebert Precision Cooling
HP Dynamic Smart Cooling
IBM Systems Director Active Energy Manager
RC Precision Cooling
Corporate Multifunctional Copier / Printer /
Scanner
Canon Color ImageRUNNER 3580i
Fuji Xerox ApeosPort-III C3300
HP Color LaserJet CM2320 MFP Series
Konica Minolta bizhub C650
Lexmark X658DE
Ricoh Aficio MP C5000 Colour MFP
Samsung Color Multi-function
laser printer CLX-6240FX
STORAGE
Backup Storage (Tape)
Dell ML6000
HP StorageWorks Tape Drive
IBM System Storage TS3500 Tape Library
Sun StorageTek SL3000 Modular
Library System
Backup Storage (Disk)
Dell PowerVault DL2000
EMC Disk Library
HP StorageWorks Virtual Library System
IBM Virtualization Engine TS7530
Tape Library
NetApp VTL
Mid-Range Storage Systems
Dell EqualLogic PS5000 Series
EMC CLARiiON CX Series
Hitachi Adaptable Modular Storage
(AMS) Series
HP StorageWorks Enterprise Virtual Arrays
IBM System Storage DS4000 Disk Storage
System
NetApp FAS3100
Sun Storage 7410 Unified Storage System
Enterprise Storage Systems
EMC Symmetrix DMX Series
Hitachi Universal Storage Platform V
HP StorageWorks XP Disk Arrays
IBM System Storage DS8000
NetApp FAS6000
Sun StorageTek 9990V System
Storage Management Software
EMC ControlCenter Family
HDS Storage Command Suite
HP Storage Essentials Software
IBM Tivoli Storage Manager
Microsoft System Center Data
Protection Manager 2007
Solaris ZFS
Veritas Storage Foundation
NETWORKING &
COMMUNICATIONS
Enterprise Switch (50+ users)
Alcatel-Lucent OmniSwitch
Cisco Catalyst 3750E Stackable Switch &
ISR 3800
H3C S5500-SI Series Ethernet Switch
Juniper Networks EX-series (EX 4200)
Nortel Ethernet Routing Switch
Enterprise Router (50+ users)
Alcatel-Lucent 7670 Routing
Switch Platform
Cisco 3800 Series Integrated
Services Routers
H3C Multiple Service Router
– MSR 20-30-50
Juniper Networks J-series J2320
Nortel Ethernet Routing Switch
Video Conferencing
Cisco TelePresence
Microsoft Office Communications
Server 2007
Nortel Telepresence Services
Polycom telepresence solutions
Tandberg HD Video Conferencing
Smartphone/Mobile Enterprise Device
HTC Touch Cruise
Motorola MOTOSURF A3100
Nokia N71
Apple iPhone
Palm Treo Pro
RIM Blackberry Bold
Sony Ericsson XPERIA X1
Samsung Anycall OMNIA i908
www.cw.com.hk
April 2009 Computerworld Hong Kong 33

ANNIVERSARY covering Hong Kong technology since 1984
WLAN Switch
Alcatel-Lucent OmniAccess WLAN
Cisco Catalyst 6500 Series Wireless
Series Module (WiSM)
Cisco Wireless LAN Controller
H3C WX5002 Series Access Controller
Nortel WLAN 2300 Series
IP PBX
Alcatel-Lucent OmniPCX Enterprise
Avaya G700 Media Gateways
Cisco Unified Communications Manager
Version 7.0
Nortel Communication Server 1000
Call Center Management
Alcatel-Lucent OmniTouch Call Center Office
Avaya Contact Center Express
Cisco Unified Contact Center Express
+ Cisco Unified Workforce Optimization
Oracle Contact Center Anywhere
Messaging & Collaboration
Cisco WebEx Web Meetings and
On-demand Collaboration
HKNet (TeamWorks)
IBM Lotus Notes + Domino 8.5
Microsoft Exchange 2007
Mirapoint Message Server
Unified Communications
Avaya Unified Communications Advanced
Cisco Unified Personal Communicator
IBM Lotus Sametime
Microsoft Office Communications Server 2007
Joint Nortel and Microsoft Unified
Communications Solution
Structured Cabling
ADC Krone
Belkin
Hellerman Tyton
Panduit
Siemon
Systimax/Commscope
Tyco Electronics
WAN Optimization
BlueCoat Proxy SG MACH 5 Edition
Cisco Wide Area Application (WAAS)
Citrix Wanscaler
Expand Networks Accelerator
F5 Networks WANjet WAN Optimization
Appliance
Juniper Networks WX/WXC Application
Acceleration Platforms
Nortel Networks Application Accelerator
Riverbed Steelhead
SECURITY:
Firewall / VPN
BlueCoat Proxy RA
CheckPoint VPN-1 Power
Cisco ASA 5500 Series Adaptive Security
Appliance – Firewall/VPN Edition
HKNet SSL VPN
Fortinet FG-3810A
Juniper Networks SSG550M Secure
Services Gateway
Microsoft ISA 2006/IAG 2007
SonicWall NSA Series/TZ Series/
SSL-VPN Series
Content Filtering / Anti-Spyware
BlueCoat Proxy AV
F-Secure Anti-Virus Enterprise Suite
McAfee Total Protection Solutions
Symantec Brightmail Gateway
Trend Micro Anti-spyware for SMB
Websense Web Security version 7
Antivirus/Anti-Spam
CA Anti-Virus
Cisco Security Agent
Fortinet Security
F-Secure Anti-Virus Enterprise Suite
McAfee Total Protection Solutions
Microsoft Forefront Client Security
Mira RazorGate Appliance
Sophos Security Suite
TrendMicro PC-cillin Internet VirusWall/
ScanMail
Symantec Endpoint Protection
Identity Management
BMC User Administration and Provisioning
CA Identity Manager/SiteMinder Web
Access Manager
EMC RSA SecurID
IBM Tivoli Identity Manager
Microsoft Identity Life Cycle Manager 2007
Oracle Identity Manager
VeriSign Identity Protection
Intrusion Detection/Intrusion Prevention
(IDS/IPS)
Check Point IPS-1 Appliance
Cisco IPS4200 Series Sensors
Fortinet FG-3810A
IBM Internet Security Systems (Proventia)
Juniper Networks IDP8200
Oracle Adaptive Access Manager
SonicWall NSA Series
Symantec Critical System Protection
TippingPoint Core Controller ThreatLinQ
Surveillance
Burle Phillips
H3C iVS8000 Surveillance Solution
IBM Physical Security Services (IBM smart
Surveillance Solutions)
Panasonic
SonicWall NSA Series
Unified Threat Management (UTM)
Check Point UTM-1 Total Security Appliance
Check Point VPN-1 UTM
Cisco ASA5500 Series Adaptive Security
Appliance – Anti-X Edition
Fortinet FG-3810A
IBM Internet Security Systems (Proventia)
Juniper Networks Unified Threat
Management (UTM)
Network Box E-Series
WatchGuard FireBox X
SonicWall NSA Series/TZ Series
Managed Security Services
AT&T
BT
CPCNet
HGC
HKNet
IBM Internet Security Systems
Network Box
PCCW
Symantec MessageLabs Managed
Security Services
Verizon
SOFTWARE:
Database Management
MySQL 5.1
IBM DB2 Universal Database
Microsoft SQL Server 2008
Oracle Database
Sybase Adaptive Server Enterprise (ASE)
Teradata 12
34 Computerworld Hong Kong April 2009 www.cw.com.hk

Application Server & Middleware
GlassFish
IBM Websphere
Microsoft BizTalk Server 2006 R2
Oracle Fusion Middleware
Oracle WebLogic Server
Systems Management
Altiris Total Management Suite
APC InfraStruXure Central
Avocent DSView 3 Management Software
BMC Performance Manager (Patrol)
EMC Smarts
HP Operations Center
IBM Tivoli System Management Suite
Microsoft System Center 2007
Oracle Enterprise Manager
Enterprise Resource Planning (ERP)
ECL IFS
Epicor ERP
Kingdee K/3 ERP
Lawson ERP solutions
Microsoft Dynamics AX 2009
Oracle E-Business Suite
SAP ERP
Supply Chain Management (SCM)
Epicor SCM
I2 Supply Chain Management Solutions
Oracle Supply Chain Management
SAP SCM
Customer Relationship Management (CRM)
Microsoft CRM 4.0
Oracle Siebel CRM
SAP CRM
SAS Customer Intelligence
Teradata Relationship Manager
WeB e-Mail Marketing (Web-eM)
Document and Content management
Canon File Navigator
EMC Documentum Content Management
Fuji Xerox DocuShare
IBM FileNet
Microsoft Sharepoint Server 2007
Oracle Universal Content Management
Ricoh SME Solution Suite
BI and Analytics
IBM Cognos 8 Business Intelligence
Microsoft SQL Server 2008
Oracle BI Applications + Oracle BI EE Plus
Oracle Essbase
SAP BusinessObjects
SAS 9.2
Sybase IQ Analytics Server
Teradata Active Enterprise Intelligence
Data Mining & OLAP
IBM InfoSphere Warehouse
Microsoft SQL Server 2008
Oracle Database
SAP Business Objects OLAP Intelligence
SAS 9.2
Developer Tools/Web Services
IBM Rational Professional Bundle
Microsoft Visual Studio 2008 Team System
NetBeans IDE 6.5
Oracle SQL Developer
Sybase Power Builder
Server OS
HP-UX
IBM AIX 5L
Microsoft Windows Server 2008
Novell / SuSe Linux
Oracle Enterprise Linux
Red Hat Enterprise Linux
Solaris OS 10 10/08
Virtualization
Citrix XenApp 5
Citrix XenDesktop
HP Insight Dynamics – VSE
Microsoft Windows Server 2008 Hyper-V
Nortel Ethernet Routing Switch
Oracle VM
Sun xVM
VMware Infrastructure
SERVICES:
Corporate Mobile Services Provider
CSL
Hutchison Telecom
New World Telecom
PCCW Mobile
SmartTone-Vodafone
Data & Telecoms Services Provider
AT&T
BT
HKNet (SecureNet IP-VPN Service)
New World Telecom
NTT Com Asia Ltd (Arcstar)
Orange Business Services
PCCW
SingTel ConnectPlus IP VPN and E-VPN
Verizon
Wharf T&T
Managed Services
AT&T
BT
CPCNet ManagedCONNECT
EMC Consulting & IT Services
HP
IBM Global Technology Services
(IBM Managed Services)
Jardine OneSolution
New World Telecom
Nortel Network Managed Services
NTT Com Asia
Oracle Advanced Customer Services
Orange Business Services
PCCW
Verizon
IT Hosting & Outsourcing
COL
HKNet
HP
IBM Global Technology Services
(IT Outsourcing)
Jardine OneSolution (Email On-Demand
Service – Hosted Exchange)
New World Telecom
Oracle Advanced Customer Services
Orange Business Services
PCCW Solutions
Consulting & Systems Integration
COL
Datacraft Asia
EMC Consulting & IT Services
HKNet
HP
IBM Global Business Services
Newtech Technology
NTT Com Asia
Oracle Advanced Customer Services
PCCW Solutions
www.cw.com.hk
April 2009 Computerworld Hong Kong 35

Social apps for business:
plan less for less pain
Standardizing on tools people already use, like Facebook and Twitter,
can be the path of least resistance, say experts
Productivity loss, information leakage, and
defamation of fellow employees are all
enough to get us fired from our jobs, unless
of course it’s done under the guise of a social
network for the enterprise 2.0.
Businesses are beginning to grapple with the
emergence of a culture of IT self-service among
employees and the savvy leaders will harness,
rather than hinder, the use of external hosted applications,
including social networking, according
to a group of IT professionals.
Experts: culture shift
Speaking on a panel about social networking
for business at the Enterprise 2.0 Executive Forum
in Sydney, representatives from insurance
company AMP, consulting firm Deloitte and IT
analyst firm Forrester Research, agreed that rapid
adoption of external applications by employees
is here to stay so the challenge is how to leverage
this culture shift.
Annalie Killian, AMP’s catalyst for magic [actual
title], said social networks have helped dissolve
boundaries between the inside and outside of the
organization. “I communicate with colleagues via
Facebook as much as e-mail,” Killian said.
AMP tried to “experiment” with yammer for inhouse
social networking, but it didn’t get enough
uptake and people started to use Twitter “without
being told.” “It happened organically so I think
why try and implement another enterprise tool
when all the fish are at Twitter,” she said. “I don’t
want to manage Twitter.”
Killian said that giving enterprise users freedom
to use the tools they are comfortable with is
often the most useful way to start an IT project.
“I quickly start playing with stuff and think laterally
about how it would be good for the business,”
she said. “Then I find like-minded souls
playing with the tools and it circles out from
there.”
User power
Over at Deloitte Digital, CEO Peter Williams
found 30 percent of his staff were using Facebook
before it was even considered as a business
application.
“The business case proved itself—if 30 percent
of people using tech we didn’t ask them to are
combining work and social networking, that’s
the best rollout of technology we’ve ever had,”
Williams said. “We could do it internally, but that
would be a pain so we just standardized on Facebook
and build applications around that.”
Williams has noticed “deeper connections” between
staff can be formed with social networks,
not just in a work environment. “There is a thing
called ‘weak tie networks’ where you get more
done through a friend of a friend and not immediate
contacts,” he said, adding the network effect
model is creating opportunities for business
growth.
Deloitte’s Williams. “If your organization has a
culture of back-stabbing then it will happen on
social networks. Saying we should ban social networks
is like saying we should ban phone calls
and e-mail.”
“We say don’t diss each other and we have a
culture of openness so it goes with the turf,” Williams
said. “It’s the same with editing wikis and
people leaving rotting food in the fridge, there is
a certain level of self-regulation.”
Employee behavioral control in the Web 2.0
age comes with the standard terms and conditions
for all IT system use at Deloitte: “Don’t
make them 30 pages long and have a ‘be smart,
use judgment’ mantra,” said Williams.
hosted applications, including social networking
Forrester Research senior analyst Steven Noble
said social networks are “the easiest and the
hardest” technology to build a business case for
because the benefits are largely “soft.”
“It should be easy to build a business case for
social networking as the core functionality is
pretty simple,” said Noble. “For example, integrated
collaboration tools, blogging and Share-
Point will all build profile capabilities and that is
a social network.” Noble said social networks will
increasingly become the “glue” that binds applications
together.
Not so fast, that’s my company data
An increasing headache for businesses living
in the closed-shop IT world is the amount of potential
for social networking employees to leak
sensitive data to a third-party of publicize potentially
damaging information about people.
“It goes down to organizational culture,” said
At AMP similar rules apply. We’re trying hard
to have [a] simple social media policy,” said Killian.
“We have a live-and-let-live policy unless a
complaint is raised. We also have a lot of introverts
in the organization. It’s different strokes
for different folks and it’s not a massive problem.”
Killian said a lot of companies want to see social
networking fail in order to “sell you some security
software or something.” “When you sign up
for your own blog there is a three-line guideline
statement saying ‘don’t put up anything offensive’
and we then let the community self-regulate,” she
said. “Most people are sensible.”
We live in an age where employers will “Google
you before they hire you,” so don’t release anything
to the Internet you don’t want others to see,
according to Killian. “Companies tend to focus on
boundaries and not what flourishes inside them,”
she said.
36 Computerworld Hong Kong April 2009 www.cw.com.hk

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Google’s share of Internet search in China
moved up a hair last year, statistics from
the government’s number cruncher
show, indicating the company continues to struggle
against market leader Baidu.
Google captured 16.6 percent of Chinese
search engine users last year, up from 14.3
percent the year before, China’s domain registry
center said in a report last month.
Google has struggled to raise its user share
against Chinese search giant Baidu, which
opened in 2000 and has worked hard to lead
its domestic market.
Baidu’s user share rose more than two percentage
points to 76.9 percent last year, the
Chinese Internet Network Information Center
(CNNIC) said.
China had 298 million Internet users at the
end of 2008, the most in any country, according
to CNNIC.
“Google is doing a lot of the right things in
China—it’s just in the situation that there’s a
limit to how much market share it’s going to
be able to get,” said Mark Natkin, director of
Marbridge Consulting in Beijing.
Baidu has an easily recognizable
Chinese name, while Google
only introduced a Chinese name in
2006 and has not caught on as well
among users outside of major cities, he said.
Google’s Chinese name, “Gu ge,” means
“valley song,” but its catchier English name is
more popular among young urban Chinese.
“There’s a strong perception that Google is
a foreign brand, a foreign search engine, and
that Baidu is a domestic one,” Natkin said. “As
such, there’s a little more user acceptance
for Baidu.”
Some analysts also say Baidu attracts
many search engine users
with an MP3 search that links to free downloads
of copyrighted songs.
Google launched a free music search download
service in China for registered songs last
year to compete with Baidu, but limited selection
has deterred users.
More users stayed loyal to Baidu than to
Google in 2008. Google retained around 80
percent of users from 2007 to 2008, much lower
than Baidu’s 96 percent retention, the CN-
NIC report said.
Yahoo’s user share fell to 1.6 percent last
year, the report said without elaborating. The
report did not offer a corresponding figure
from 2007.
Michael Dell sees faster economic recovery in China
The CEO of Dell called business conditions
in China among the best in the
world amid slowing global growth at a
talk in Beijing last month.
China has unrolled massive stimulus spending
and launched a discount initiative for rural
consumers buying PCs and other electronics
to spur growth.
“China seems to have come out of the cri-
sis stronger than other countries, faster, and
the government’s pretty rapid action seems
to have caused a positive demand condition,”
said Michael Dell.
Fifteen Dell products, including some models
modified for Chinese consumers, are eligible
for the country’s subsidy program. The
company is investing in rural areas to support
the program and boost sales, Dell said.
Fifteen Dell products, including some models modified for
Chinese consumers, are eligible for the country’s subsidy
program. The company is investing in rural areas to support
the program and boost sales, Dell said
Dell dodged a question about reports that
layoffs at his company could extend to some
of its 6,000 employees in China. China, Dell’s
second largest market, accounts for about
five percent of its global business.
Dell is one of many firms that has targeted
remote Chinese cities to boost growth. Those
efforts have paid off for many firms, but the economic
downturn has hit the Chinese countryside
as well, said Bryan Ma, an analyst at IDC.
How much the rural subsidy program will
help remains unclear.
“There are, of course, going to be a good
number of units sold through the program,
but we don’t believe it’s going to create any
major inflection points in the market,” Ma
said.
Computerworld Hong Kong April 2009 www.cw.com.hk

VMware will expand in China as it moves
to meet rising demand for desktop and
data center virtualization in the country,
a company executive said in an interview last
month.
VMware is rapidly building a customer base
among smaller Chinese firms—those with 1,000
or fewer staff—even as it expands services for
bigger clients with mature virtualization systems
in place, said Andrew Dutton, VMware’s
new Asia Pacific head.
VMware’s business in China tripled last year.
The firm expects to have 350 staff in China by
the end of the year, up from about 200 now.
That level of growth could continue for a
number of years, Dutton said.
“As we see opportunity present itself, we’ll
staff up to meet that opportunity,” he said.
VMware releases local Chinese versions of its
products about two months after their English-
nications operators have been among the fastest
to virtualize their servers in China, while high
costs and a lack of awareness have made small
firms slow to follow suit, said Ravi Shekhar Pandey,
an analyst at Springboard Research.
Foreign companies offering virtualization in
China could find it difficult to crack software
and service sectors dominated by Chinese
firms, said Pandey.
“I have a strong feeling that Chinese customers
are more comfortable working with Chinese
companies,” he said.
Still, Microsoft and Virtual Iron rank beside
VMware as foreign firms that have made inroads
to China’s virtualization market.
“VMware has an advantage in the sense that
it is recognized in every market as somebody
who pioneered this, who made it easy for companies
to virtualize their infrastructure,” Pandey
said.
3Com Corp may have lost ground in Western
markets in recent years, but meantime
it has built a low-cost operations
base in China that it hopes will attract more
and bigger customers in the developed world.
The network equipment vendor has cut costs
and gained market share in China since 2003,
when it created a joint venture with Chinese
counterpart Huawei Technologies, 3Com CEO
Bob Mao said in a phone interview.
3Com later fully acquired the joint venture.
The company’s China operations accounted
for almost half of its revenue in fiscal year
2008, Mao said.
3Com holds 35 percent of the market for networking
products in China, about as much as
Cisco Systems, he added.
“China actually has become our home market,”
Mao said.
3Com’s acquisition of H3C, its venture with
Huawei, brought it an established sales force
in China and a low-cost research and development
team. Its researchers in China have since
rounded out the company’s product portfolio,
helping 3Com beat out competitors who offer
only low- or high-end products, Mao said.
3Com made a net profit of US$92.7 million in
the first half of fiscal year 2009, a turnaround
from a $54.3 million loss in the same period a
language launch. The company counts government
ministries and some of China’s biggest
firms among its customers. High levels of virtualization
at clients such as China’s statistics
bureau and the Agricultural Bank of China have
created a need for stronger support staff in China,
Dutton said.
“Some of the customers here are so mature,
or they’re becoming so mature, in the use of
IT that they need to be right up at the cutting
edge, and to do that they want access to the
minds that built the products,” he said.
Data center virtualization provided about
90 percent of VMware’s revenue in China last
year. Less than 10 percent came from desktop
virtualization, but the firm hopes to raise that
number. It expects revenue from desktop products
in the first quarter of this year to match the
figure for all of last year.
Large firms including banks and telecommuyear
earlier. Its third-quarter results are due
out this week.
Sales of equipment for IP video surveillance
networks in China have been a boon for 3Com.
H3C has provided the hardware linking over
100 networks of surveillance camera systems
around China, mostly in cities, Mao said. Its
largest contract is for a network connecting up
to 50,000 IP cameras in Hangzhou, a coastal
city of about 6 million people known for its
scenery.
prices and swift action to win government
contracts in China, including for large, stateowned
firms and the camera networks, said
Milly Xiang, an analyst at IDC.
But H3C’s growth in China has largely relied
on the staff and brand recognition that Huawei
brought to the venture, said Xiang. The sales
force driving H3C’s success in China might
not be as effective in other cultures, she said.
“3Com has not made obvious progress outside
China in recent years,” she said.
The network equipment vendor has cut costs and gained
venture with Chinese counterpart Huawei Technologies
“In total the surveillance market is growing, 3Com held 1.1 percent of the worldwide market
whether you and I like it or not,” Mao said.
for routers last year, according to IDC re-
“But the IP-based part [of the market] is the search.
fastest growing part.”
3Com plans to stay an independent company
3Com’s next goal is to expand outside China. after a failed acquisition by Bain Capital Partners
It wants to attract more big firms, which currently
two years ago, Mao said.
account for only half of its customers National security concerns in the U.S. derailed
that deal, which would have given Hua-
outside of the country, Mao said.
H3C has undercut competitors with low wei a stake in 3Com.
www.cw.com.hk
April 2009 Computerworld Hong Kong 39

40 Computerworld Hong Kong April 2009 www.cw.com.hk

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www.cw.com.hk April 2009 Computerworld Hong Kong 41

Driving China’s ICT
It’s the comms players, stupid
By Robert Clark
The most important players in China’s
ICT are the comms vendors.
If you doubt it, look at the numbers.
Huawei last year sold around US$18
billion in networking gear. State-owned rival
ZTE sold $6.5 billion worth (for $249 million
profit).
The only IT firm on the same scale, Lenovo,
paddles in the commodity shallows and in any
case is struggling to stay afloat—its last quarterly
result showed a $97 million loss on sales
of $3.6 billion.
The rest are not even close. B2B platform Alibaba.com
posted just $321 million in revenue
for the first nine months of last year. The wellregarded
IT services firm Neusoft made a $3
million profit on gross sales of $42 million.
Why comms?
The reasons for this are more interesting. For
one, the comms equipment sector is driven by
scale and standards, not innovation. Whatever
advantage an innovator achieves is dissipated
by the time it takes to become a standard.
Unlike their IT counterparts, Huawei and
ZTE have leveraged technology transfer from
companies like Alcatel-Shanghai Bell, which
set up 30 years ago (and is now wholly Chinese-owned).
They’ve been able to get scale from China’s
own massive telecom build-out over the past
20 years. In doing so, they’ve competed headto-head
with the world’s biggest comms suppliers—a
classic example of open competition
building world-class competitors.
Neighboring rivals Samsung, NEC and Fujitsu
have played themselves out of the market
through protectionist domestic policies—a
perfect example of how not to
execute hi-tech industry development.
Sales abroad
Thank to that grounding, both
Huawei and ZTE now make most
of their sales abroad. The next
couple of years could see them
go from merely being major
players to driving the whole sector.
The recession plays to their
obvious strengths and is making
buyers lose their previous skittishness
about dumping their
old suppliers.
The first sign is that Huawei
looks on the verge of some serious
North American business.
It has reportedly won a contract
to supply Cox Cable with
a 3G network—believed to be
worth around $100 million—and
is in the running for a much bigger
deal to sell WiMax gear to
Clearwire.
The Clearwire project is set to
be the largest WiMax network in the US. Huawei
is reportedly on the shortlist with Motorola,
Samsung and Nokia Siemens.
If it goes ahead it will be a big breakthrough
for Huawei, which has continually hit roadblocks
in the US.
of years could see
Huawei and ZTE
go from merely
players to driving
the whole sector
Political controversies
Huawei’s biggest contract to date has been
a cdma2000 contract with niche carrier Leap
Wireless. Its major obstacles have not been
legacy suppliers but IPR (Intellectual Property
Rights) and political controversies.
Its first effort faltered after thousands of lines
of Cisco code were found in Huawei’s Quidway
router (the two companies settled out of court).
Last year Huawei’s attempt to buy 3Com in
a joint offer with Bain Capital collapsed after
US officials made it clear it would
be rejected on national security
grounds.
Over the past two years alone
Huawei has provided kit for carriers
such as France Telecom, BT,
TeliaSonera, Bell Canada, Vodafone
and StarHub—so there’s
clearly no problem with Huawei’s
technology.
The political nature of its problem
was underlined recently with
the leak of a UK intelligence report
that claimed Huawei had built a
backdoor into BT’s next-gen broadband
network.
Whether true or not—and the
published evidence is sketchy to
say the least—it shows the sensitivity
of the US and the UK to Huawei
and its PLA background.
So don’t expect Huawei to start
selling gear for Verizon—the Pentagon’s
main comms contractor—
or AT&T any time soon. But the
news out of Cox and Clearwire suggests
the vendor’s North American
footprint is going to widen pretty steadily over
the recession.
Fat cash
Meanwhile, rival ZTE has lined up a hefty
war chest—a $15 billion line of credit from the
China Development Bank—most likely to be
held out to cash-strapped foreign telcos in the
form of vendor financing.
Once it was fashionable for big foreign vendors
to do the same thing—they accumulated
an estimated $26 billion in loans to carriers on
their books by 2000. Then the bubble burst.
ZTE won’t have that problem. One more reason
for thinking that its time has come.
Robert Clark is a Beijing-based technology journalist.
rclark_a_electricspeech.com
42 Computerworld Hong Kong April 2009 www.cw.com.hk

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