Why Buffet doesn't bet on India

Warren Buffett, the world’s second richest person and arguably the biggest individual investor, would not like to bet on India. According to Robert P Miles, who has written three books on Buffett, the renowned investor doesn’t buy or invest in sectors, regions or stocks where investment risks were not clear and visible to him.

Delivering a packed Indiatimes Strategy Summit on Buffett, Miles said Buffett used to invest in companies which remained firm in their business model.

For example, his biggest stakes are in companies like Coca-Cola, American Express, Gillette and Washington Post. ‘‘Coca-Cola tasted the same as it was 100 years ago and occupies the same share of mind even today.’’

Miles explained that Buffett is getting returns from India as major revenues of Coca-Cola and Gillette are generated from international markets. Buffett has not invested in tech stocks as he cannot define their shape in a decade’s time. That’s one of the reasons he hasn’t invested in Kodak. Even though Microsoft’s Bill Gates is his best friend, who constantly seeks his counselling, Buffett has not invested in Microsoft.

Advice to Ambani Brothers from Warren Buffet:

WB’s beliefs: Never do anything in business that you would not want on the front page of your local newspaper by a credible reporter. He believes that integrity is oxygen. If you don’t have that, you have nothing.

Investment rules:

Invest in what you know, and what you understand. Risk is nothing but not knowing what you are doing. During the Internet boom, someone asked WB why he did not change his principles. He said Internet does not change the way people chew gum.

Buffett’s biggest mistake:

He regretted not to have invested in Walmart despite the fact that all the three CEO’s were his buddies.

Buffet CEOs:

In each business that Berkshire Hathway (Buffet’s main investment vehicle) has acquired, there have been no layoffs, no retirements and no rocking chairs. Berkshire CEOs are worth an average $100 million and WB has not lost a single CEO to a competitor.

WB’s retirement:

Buffet says he’d like to retire 5-10 years after his death. He wishes that when people pass by his coffin, they should ask themselves, ‘‘Oh boy, does he look old?’’

Robert P Miles: “Buffet doesn’t invest where investment risks are not clear and visible to him.”

Happy moments for IT vendors

Core Banking Solutions:
LSI - Laser Soft Infosystem - a chennai based banking software products firm, has implemented its ‘Panacea Core Banking System' in over 350 branches of the state-owned Corporation Bank. The core banking system was implemented at a cost of $9,114 per branch. This solution covers all areas retail banking, trade finance and corporate banking.

Corporation Bank lost lot of steam in lst two quarters and hope to get leverage out of this IT initative. It's observed that, bank's operating margin, cost of operation are lowered but again transfer of Mr. Cherian Vergese from Corporataion bank to Union Bank of India is playing vital role in bank's success to be a second largest bank.

Outsourcing

Yes Bank has signed a seven-year outsourcing agreement with Wipro Infotech. The bank hopes to save up to 30 percent through the arrangement. Wipro Infotech will undertake Yes Bank's entire technology requirement for its offices, branches nationwide and data centres on a build-own-operate basis. The bank plans to roll out nearly 400 new branches in the next seven years.

Wipro is entering into new territory of opportunities in outsouring market of banking and financial vertical market place. Stregnth of WIPRO many years of org. learning for dealing with financial institutations and time to makret is right to capatilse these learnings. However, WIPRO is bound block his horns with big bulls of IT Space i.e. HP and IBM who are mastered in capturing large ticket size of outsourcing deal in India and globla level.

WIPRO need to learn from 2nd layer of outsourcing players like EDS, Accenture on managing their operations but, it can excel over this 2nd layers players becuase of distinct advantage of being truely professional and process oriented organisation. such as the other players. In wake of RIL contraversy, IT decision makers are wary of stability in group, WIPRO's corporate governance and process orientation has feched many more wins against big boys of IT in past and coporate world look forward to such metrics for awarding the contracts.

Mobile Banking (Marriage of Bank and Telecom Vendor - is India Listening)
China Construction Bank (CCB) and China United Telecommunications Corporation (China Unicom) have launched a joint mobile banking service based on China Unicom's CDMA 1X network and CCB's electronic banking system.

China Unicom subscribers with CCB accounts will be able to check accounts, transfer or remit funds via their mobile phones.

Mobile E-Purse:
(Jamboorie for customer of Bank-Telecome Vendor and Retailer):

Sumitomo Mitsui Banking Corp. will launch a service, in April 2005, enabling individual account holders to directly transfer money to their mobile phones for use in the Edy electronic-money service operated by Bitwallet Inc. Customers needs to be the bank's Internet banking service user and have a handset with the FeliCa non-contact IC chip for NTT DoCoMo Inc.'s (9437) mobile phone services.

China card market lures big players

To tackle China’s potentially lucrative credit card market, American Express and Visa have launched their largest initiative yet on the same day – December 8th – by partnering with some of China’s biggest banks, Industrial and Commercial Bank of China (ICBC) and Bank of China (BOC) respectively to release dual currency cards. The launches will take nationwide what has previously only been attempted on a small scale, largely in Shanghai through products launched by Bank of Shanghai and Shanghai Pudong Development Bank (SPDB). In addition to this HSBC has announced a 2005 credit card joint venture with Bank of Communications, in which it has made the maximum-allowed investment of nearly 20 percent. It has been said that if China’s big four banks were to promote credit cards, business would boom overnight, but a lack of developed credit bureaus in China could make this a risky proposition. Credit card operators in China so far have been operating at a loss, or with very slim profits. But the numbers show that the potential for market growth is highly encouraging. Operators are clearly encouraged by the sheer lack of presence of credit cards in a massive bank card market that is nearly entirely governed by debit cards. Of China’s 704 million bank cards in circulation, 650 million are debit cards with the balance taken up by store cards, quasi credit cards – debit cards with an overdraft – charge and real credit cards. With 7 million credit cards in circulation in the first half of 2004, a marginal base of one percent represents a high potential for growth, as demonstrated by the fact that credit cards in issuance increased 70 percent from 2002 to 2003. ICBC aims to release 100,000 of its American Express cards in 2005. According to Asian Banker Research, among Asia’s main markets, China’s per capita card penetration rate is 0.03 percent, ahead only of Indonesia (0.02 percent) and India (0.01 percent). Korea and Japan, the highest, are both near two percent. It has been estimated that if present trends continue, the card market may have $3 billion in annual revenue by 2010. Should China achieve the 80 percent of eligible adults holding credit cards, as it is in the US, 48 million cards would be issued. Merchant acceptance is presently still a weak link in China’s credit card chain. With only two percent of merchants accepting credit cards by the end of June 2004, and even with 30 percent in major cities such as Shanghai, there is clearly still much work to be done. According to American Express less than 0.4 percent of merchants that take credit cards accept foreign currency cards. Visa International hopes to have 75 percent of merchant terminals accepting its card by 2008, to be in line with what it claims was achieved in Athens for the 2004 Olympics. It claims that China currently has 100,000 terminals that accept Visa. American Express, working for the first time with a Chinese bank, would not disclose the number of terminals that would accept its card, although it explained that the card will work with the networks of ICBC and China Union Pay (CUP). The Visa cards do not carry the CUP logo. Due to the small size of the market, credit card fraud trends are not properly understood yet. The Chinese government in October announced changes to the criminal law that would include legal definitions of credit card fraud. According to sources at Visa, most of the new terminals being installed in China are compliant with the EMV anti-fraud security standard that is being promoted in China, although the cards themselves do not carry chips yet. The government will only be publishing China’s EMV standard this month. Neither Visa’s new BOC card nor ICBC’s American Express card will carry a chip, although IC cards of varying types are already in wide use in China. American Express has not released any IC chip cards in Asia Pacific. Credit bureaus, while still in an early stage of development, should still play an important role in the development of a sustainable rate of credit card usage in China. Local credit bureaus are available to gather a robust set of data, including information drawn from utility payments, that credit bureaus even in mature markets like Singapore and Australia are by law not allowed to gather. Debit card spending and usage patterns, of which China has a well-established industry, may also be a robust source of information for credit information providers. Partnering with a local institution is also vital for understanding the local markets. Banks like China Merchant Bank run successful credit card programs, that they claim have high profitability – at levels comparable to the USA – without using credit bureaus, largely by issuing through corporations to their employees.

Research Work on Linux's Stability

The Linux operating system has many times fewer bugs than typical commercial software, according to an upcoming report.

The conclusion is the result of a four-year research project conducted by code-analysis company Coverity, which plans to release its report on Tuesday. The project found 985 bugs in the 5.7 million lines of code that make up the latest version of the Linux core operating system, or kernel. A typical commercial program of similar size usually has more than 5,000 flaws or defects, according to data from Carnegie Mellon University.

"Linux is a very good system in terms of bug density," said Seth Hallem, CEO of Coverity, a San Francisco company that makes flaw-detection tools for software written in C and C++ programming languages.

Code-analysis tools typically use software-design principles to analyze a program's source code and flag any possible problems. Microsoft already uses such tools widely in its internal development, and many compilers are starting to include rudimentary versions of the programs as well. The tools are also being used to tame the wild coding prevalent around the Web.

Though Coverity does not have any data about the relative frequency of flaws in Microsoft's Windows operating system, the latest data will likely feed the debate between the various proponents of Linux, Mac OS X and Windows over which operating system is more secure.

A recent report, for example, found that Red Hat Linux had fewer critical flaws than Microsoft Windows. Another research paper, conducted by Forrester Research and sponsored by Microsoft, unsurprisingly favored Windows.

Coverity has not analyzed the source code to Microsoft Windows because the company does not have access to the source code, Hallem said. Apple Computer's Mac OS X has a great deal of proprietary programming, but the core of the operating system is based on BSD, an open-source operating system similar to Linux.

Hallem stressed that the research on Linux--specifically, version 2.6 of the kernel--indicated that the open-source development process produced a secure operating system.

"There are other public reports that describe the bug density of Windows, and I would say that Linux is comparable or better than Windows," he said.

A representative of Microsoft could not immediately comment on the Coverity study.

The research suggests that the Linux kernel scored better than run-of-the-mill commercial code. Proprietary software, in general, has 1 to 7 flaws per thousand lines of code, according to an April report from the National Cybersecurity Partnership's Working Group on the Software Lifecycle, which cited an analysis of development methods by the Software Engineering Institute at Carnegie Mellon University. For a 5.7 million-line program, such as version 2.6 of the Linux kernel, that roughly adds up to between 5,700 and 40,000 flaws.

Microsoft uses analysis tools similar to those in Coverity's study to vet its Windows code. One tool, known as PREfast, runs on each developer's workstation to check code for simple problems. The other tool, PREfix, is run every night on the Windows source code to catch more complex issues.

Coverity's Hallem acknowledged that by running similar tools to its own, Microsoft likely had reduced the number of defects in Windows. Coverity plans to provide regular bug analysis reports on Linux and make a summary of the results available to the Linux developer community.

ATM Ad Campaign in UK for "Lemony Snicket"

ATM better Promotion vehicle than TV - Not a myth.

United International Pictures (UIP) is running an advertising campaign for its new film "Lemony Snicket’s Series of Unfortunate Events" on ATMs located in Asda stores throughout the UK, utilizing a combination of full-screen video sequences and printed receipts.

The campaign was created using ATM:ad software which enables targeted advertising campaigns across multiple ATM networks. The software, developed by design firm i-design, retains and records key data every time an ad is displayed, so UIP will be able to track how many one-to-one interactions with ATM users occur during the course of the campaign.

The campaign for the movie, which opens on Dec. 17th, went live at 146 ATMs last week and will run for 10 days.

The ‘Lemony Snicket’ ad will utilize four separate ATM:ad modules.
>>> A 10 second "attract’" sequence continuously loops and features film animation prior to a customer inserting his or her card.

>>>A minimum five-second sequence appears during the transaction while the customer waits for cash or other services, followed by a reinforcing "thank you" message at the end of the transaction and finally a receipt printed with an advertisement.

The campaign was organized for UIP by ZenithOptimedia’s outdoor specialist arm, Meridian Outdoor. Static imagery was provided by Feref.

CRM>>>CEM>>> Customer's PRoduct Longivity

Thank God,Microsoft is not manufacturing ATMs :)

King Oil, owner of Mara-Mart convenience stores in Indiana, has won Triton Systems' 10th anniversary contest to find the ATM manufacturer's oldest retail machine still in operation with the original owner. Both King Oil and the independent sales distributor who sold the ATM will receive new Triton 9100 models, according to a news release.

Dan Linville, service manager for IFS Cash Processing Systems -- an affiliate of the Kahuna Business Group -- said he installed the Triton ATM model 9500 on May 15, 1995, at a Mara-Mart in Walton, Ind. Linville said the machine has had numerous upgrades and continues to work at another King Oil Mara-Mart location in Burlington, Ind.

King Oil General Manager Denny Wiseman said, "We've been happy with the Triton ATMs we've purchased. We've had several different Triton models and they've all served us well."

Triton held the contest to commemorate its entry into retail locations 10 years ago when a convenience store in Diamondhead, Miss., installed the first bill-dispensing ATM designed specifically for retail use, a Triton 9500 like the model used at King Oil's Mara-Marts in Indiana.

Life insurers look to IT

US life insurers face increasing competition from other insurers as well as from commercial banks and career agents. Increasingly, these agents are leaving their companies in favor of independent brokerages, often with their clients in tow. To counter the resulting decline in profitability, many insurers are looking to improve their IT systems as a way to boost operational efficiency and to lower costs.

In cooperation with LIMRA International,McKinsey conducted two surveys of 40 leading US life insurers of all sizes about technology priorities and the effectiveness with which they have been implemented.

1. Business Area: distribution- and compensation-management automation
It provides insurers with a better understanding of all facets of the distribution cycle: product planning, channel selection, sales, and agent compensation. It also gives these companies tools for monitoring agents, retaining their top performers, and improving client service.

2. Straight-through processing
It links tasks that were previously unconnected, such as new applications, renewals, service requests, and claims. This approach often greatly improves productivity by streamlining data entry, applications review, and underwriting and processing.

The main factor driving the use of these technologies is that agents are leaving their longtime employers at a record rate. Typically, agents know how much of a client's total business a carrier has captured as well as its possible cross-selling opportunities. As the sole keepers of this knowledge, they wield tremendous power over insurers and, as a result, can extract higher commission rates from them. Now, however, distribution- and compensation-management technology is enabling insurers to capture and retain critical information about their clients and agents. This technology can assist companies in matching products with customers and generating sales leads even after agents have departed.

These technologies are not easy to implement, nor are they trouble free. Survey showed that in 2002, failed IT projects and cost overruns accounted for up to 20 percent of the total expenditure on IT projects. Insurance executives acknowledge that they must improve their ability to implement IT. To achieve their aims, they cited the need to focus on fewer critical initiatives and to introduce processes that align business and IT priorities. The executives also want to make employees accountable for a project's implementation as the first step toward recapturing some of the life insurers' lost profitability.