Archive for May, 2013:

Microsoft wheels out 256GB Surface Pro tablet – in Japan

New model will sell elsewhere, but no word yet on when

A business-friendly version of Microsoft’s Surface Pro laptop/tablet is being introduced in Japan sporting 256GB of memory, double that of the previous top-of-line model.

Microsoft Japan says in a press release that it will sell the new version in other countries, but doesn’t say which ones or when. The device sells for $1,183.50.

MORE: 2nd-generation Surface tablets may debut next month

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The Japan version of the 128GB Surface Pro ($985.92) costs roughly the same in the U.S. ($999), so the eventual U.S. price for the 256GB Surface should be in line with the Japan price. Prices don’t include a keyboard.

Microsoft has been making Surface available in several other countries over the past few weeks, saying it will hit Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Italy, Luxembourg, New Zealand, the Netherlands, Norway, Portugal, Spain, Sweden, and Switzerland and the U.K. by the end of the month. Japan, Russia, Korea, Malaysia, Singapore and Thailand will follow in June.

Surface Pro runs on an Intel processor and supports both Windows 8 applications and any application that can run on Windows 7. This is different from Surface RT, the Microsoft tablet powered by ARM chips and that only supports Windows 8 applications and a specially crafted version of Microsoft Office.

Given its support of Windows 7 applications and its optional keyboard, Surface Pro is considered a candidate for business use as a possible replacement for laptops. The larger memory of the model being introduced in Japan would make it more attractive for enterprise use where certain jobs require storage of large files.

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Microsoft opens new competitive fronts with cloud-based Windows Server

Amazon, VMware and even Microsoft partners threatened by Windows Azure move

Microsoft doesn’t want to admit it, but a Gartner analyst says the vendor’s decision to offer Windows Server instances in the Azure cloud is opening a new competitive front against partner hosting companies.

Before 2010 is over, Microsoft will update Windows Azure with the ability to run Windows Server 2008 R2 instances in the Microsoft cloud service. The move could blur the lines between platform-as-a-service (PaaS) clouds like Azure, which provide abstracted tools to application developers, and infrastructure-as-a-service (IaaS) clouds such as Amazon’s EC2, which provide raw access to compute and storage capacity.

Microsoft Windows Azure and Amazon EC2 on collision course

This move also improves Microsoft’s competitive stance against VMware, which is teaming with hosting companies to offer PaaS developer tools and VMware-based infrastructure clouds.

But the cloud-based Windows Server instances open up a new competitive front against Rackspace and other Web hosters who are Microsoft partners, according to Gartner analyst Neil MacDonald.

Microsoft has, to some extent, downplayed the new capabilities, saying the cloud-based Windows Server – which goes under the name Windows Azure Virtual Machine Role – is primarily an on-ramp to port some applications to the Azure cloud.

“What they really want is people using Azure,” MacDonald says. At the same time, VM Role “is a form of infrastructure-as-a-service,” he continues. “The reason Microsoft is being so vague is they really don’t want to upset their ecosystem partners, all the hosters out there in the world making good money hosting Windows workloads. Microsoft doesn’t really want to emphasize that it is competing against them.”

Whereas IaaS clouds provide access to raw compute power, in the form of virtual machines, and storage that is consumed by those VMs, PaaS clouds provide what could be described as a layer of middleware on top of the infrastructure layer. Developers using PaaS are given abstracted tools to build applications without having to manage the underlying infrastructure, but have less control over the basic computing and storage resources. With Azure, developers can use programming languages .Net, PHP, Ruby, Python or Java, and the development tools Visual Studio and Eclipse.

Microsoft officials have previously predicted that the lines between PaaS and IaaS clouds will blur over time, but stress that Windows Azure will remain a developer platform.

In response to MacDonald’s comment, Windows Azure general manager Doug Hauger says “our partners provide a vast range of services to customers for hosting an infrastructure-as-a-service [cloud]. The VM Role does not compete with them in this space.”

For what it’s worth, Rackspace does view Microsoft as a cloud competitor. “The cloud market is going to be huge and there are many ways to win in it,” Rackspace President Lew Moorman says. “Microsoft is serious about the market and we view them as an emerging competitor as well as partner. We are confident that our service difference will resonate to a large part of the market regardless of the technical offers that emerge from players such as Microsoft.”

In an interview this week, Hauger discussed both the similarities and differences between Microsoft’s cloud-based Windows Server instances and the virtual machine hosting provided by Amazon and other IaaS vendors.

“I think there is an incredibly broad, gray line between infrastructure-as-a-service pure-play and platform-as-a-service,” Hauger says.

Ultimately, the marketplace will only care about the technical capabilities of cloud services, not the taxonomies used to define them, Hauger continues. With VM Role, Azure customers will have to manage and patch their own guest operating system. This is clearly different from pure PaaS, in which developers write to endpoints and services through an API, and are “abstracted from even worrying about the operating system,” Hauger says.

But VM Role, when it becomes available later in 2010, will still have some of the developer tools and other benefits of PaaS, so “it’s not the ground floor of infrastructure-as-a-service,” Hauger says. “You’re taking the elevator up a little bit.”

Even though Microsoft is offering VM hosting, that does not mean customers will be able to create custom compute and storage configurations, as they might with an IaaS provider like Rackspace, Hauger says.

Custom storage configurations are “something we absolutely do not offer with the Windows Azure platform, because we’ve made an architectural decision to have a uniform storage pool.”

On the other hand, Azure customers don’t have to worry about writing multi-tenancy capabilities into their applications. Hauger argues that building applications that are resilient, scalable and automated is, while not impossible in an IaaS cloud, quite difficult when “you’re staring down the throat of a VM and you have to manage that yourself.”

Even with VM Role, and a Server Application Virtualization option that will let developers transfer application images to Azure, Hauger does not recommend that customers “forklift a big, monolithic application from on-premise and move it over to Windows Azure.”

VM Role could be used to move some “lightweight” HPC applications to the Azure cloud, Hauger says. If a customer needs large-scale data analysis, but only for a short amount of time, it makes sense to move that app to Azure temporarily and then take it back in-house, he says. Some customers are finding that purely Web-based applications, like Facebook games, also make sense for Azure, he says.

Microsoft officials are willing to admit that Azure’s capabilities are not limitless.

For example, Microsoft CTO Barry Briggs says his own team used Azure last year to build a charity auction application, but kept credit card processing on-premise “because PCI compliance is a big deal.”

“There are some things that will probably stay on-premise for a while and I suspect PCI compliance will be there, because customers want to take some time to understand what the capabilities and potentials of the [cloud] technology really are,” Briggs says.

Although Microsoft is expanding Azure by offering VM hosting, it’s important to note that the offer applies only to Windows Server 2008 R2. Microsoft clearly wouldn’t offer Linux VMs and offering older versions of Windows Server would not fit the Microsoft strategy, either, MacDonald says.

Amazon’s Elastic Compute Cloud, meanwhile, offers Windows Server 2003 and 2008, eight versions of Linux and OpenSolaris.

Although Amazon does offer a billing service, load balancing, databases and a variety of other tools designed for developers, Amazon has not made any significant moves into PaaS, MacDonald says. Amazon says its approach prevents customers from “being locked into a particular programming model, language or operating system.”

But Microsoft’s Windows Server hosting does put the two companies into more direct competition, MacDonald says.

Perhaps most crucially for Microsoft, the VM Role service gives CEO Steve Ballmer and his cloud team a more viable way of competing against VMware, which has partnerships designed to provide both PaaS offerings and the VM hosting capabilities needed to move applications to the cloud.

“The customers need to have an easier on-ramp to cloud computing, and Microsoft wasn’t providing that and their biggest competitor was,” MacDonald says. “This was a gap they had to fill and I’m glad to see they’ve done it. I’d say it’s two years late. It doesn’t mean they’re too late, but they should have done this from day one.”

As for the Web hosters who now find themselves in competition against Microsoft, MacDonald says they will simply “have to evolve.”

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Windows 8 Update: Scarcity of touchscreens is hurting Windows 8

Dell deal on Windows RT, dubious Windows 8 sales numbers

Along with whatever other problems Windows 8 faces, Microsoft partners interested in making machines that show the operating system off to best advantage are handicapped by a short supply of touchscreens, the top Windows executive says.

The company is hoping the problem will be solved in time to make alluring devices in time for Christmas sales, says Tami Reller, chief marketing and financial officer for the Windows division, as quoted in this CITEworld story.

“We see that touch supply is getting so much better,” Reller says. “By the holidays we won’t see the types of restrictions we’ve seen on the ability of our partners and retail partners to get touch in the volume they’d like and that customers are demanding.”

Along with that area a slew of complaints about the Windows 8 user interface, many of which may be addressed by Windows Blue, the code name for the upgrade that is also coming out later this year, likely before the holidays, Reller says.

It’s still unclear what changes Windows Blue will include although rumors say the start button and start page so familiar in earlier versions of Windows will be restored. The specifics of Windows Blue – officially called Windows 8.1 – will be revealed at the Microsoft Build developers’ conference at the end of June, she says.

Although Reller didn’t mention it during her remarks at a JP Morgan tech conference in Boston, by the end of the year Intel’s Haswell chips should be in production offering a longer battery life, higher performance and improved graphic processing for a range of devices such as ultrabooks, convertibles and tablets.

This is a convergence of events that Microsoft no doubt would have welcomed last holiday season just after Windows 8 launched in October.

Windows RT deal
Dell has come out with a Windows RT tablet for $300 – $200 less expensive than the cheapest Microsoft Surface RT.

That’s a limited time offering and is a $150 discount off the regular price for its XPS 10, which sports a 10.1-inch display and, like all Windows RT devices, runs on ARM chips. Another short-term option tosses in a keyboard/dock for an extra $50.

At that price the bundle is still significantly cheaper than an iPad and may grab a few potential Apple customers.

When is 100 million not 100 million?
Microsoft says it’s sold 100 million Windows 8 licenses so far and seems proud of it, but the number is being picked apart by people who note that the number of licenses sold might be far higher than the number in actual use.

According to a story in ComputerWorld the count of machines running Windows 8 could be closer to 59 million.

Why would Microsoft release the higher number but not release the number of machines that have activated the software? The obvious answer: that number is embarrassingly small.

Windows 8 is bad for this business
Buffalo, N.Y. -based Synacor blames Windows 8 for a 16% drop in search-engine advertising revenues for its content-portal services.
Because Windows 8 defaults to Bing as the search engine and sets MSN as the home page, according to this story in the the Buffalo News. Part of Synacor’s business is to set its customers’ advertising pages into the start page of end users’ browsers.

“That hurts Synacor because the company generates revenue every time a subscriber uses the Google search box on the start pages that it designs, while a reduction in page views also hurts Synacor’s advertising sales on those start pages,” the News story says.

The situation has contributed to a 5% drop in revenues for Synacore.


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Cloud fight keeps Amazon, Microsoft, Google and Rackspace clamoring for enterprise customers

At a Summit for its cloud services division, Amazon tries to make the case its cloud is more than ready for the enterprise

Amazon Web Services is attempting to distance itself from other cloud providers by enhancing its services to incorporate the differentiating features of its competitors.

But as Amazon sets its sights more keenly on the enterprise market, recent moves by Microsoft, Google and Rackspace to improve their infrastructure as a service (IaaS) cloud offerings are creating an increasingly competitive cloud market, experts say.

“There’s a war going on in the IaaS market,” says Paul Burns, an analyst at Neovise, a boutique research firm focusing on the cloud. Today in New York, Amazon hosted one of 13 Summits it plans to hold across the world in the coming weeks, touting the success of its platform and trotting out examples of enterprise customers using its services. And it provided the backdrop for Amazon to discuss the recent advancements of its services.

AWS, a division of the e-commerce site, began in 2006 with two basic cloud-computing services: scalable storage (through Amazon Simple Storage Service or S3) and virtual machines on demand (through Amazon Elastic Compute Cloud or EC2). Amazon CTO Werner Vogels says AWS now incorporates 33 major services and products in its cloud. He announced today that S3 now stores more than 2 trillion objects in its cloud, as of last week, and it serves, at its peak, 1.1 million requests for those files per second. The company has hundreds of thousands of customers in 190 countries, and it has reduced prices 31 times since launching in 2007. “And we will continue to do so,” Vogels says.

In the last month, Microsoft and Google have made significant announcements for their AWS-competing products. Microsoft made its on-demand virtual machines (which include both Linux and Windows OSes) generally available last week. The week before, the beta tag came off of Google Compute Engine, which offers pay-as-you-go virtual machines.

Burns, the Neovise analyst, says there are two battles going on in the IaaS market right now. One is for basic services: compute, network and storage. With Microsoft and Google making their IaaS offerings more open to customers, they’re adding competitive pressure to AWS for some of the company’s original services, he says. There is a second battle for higher-level services, like databases, security, disaster recovery and running business applications, though. And on that front, “AWS is the only game in town,” Burns says. “They’re walking away with the market on the higher end of the stack.”

The breadth and depth of AWS services it offers in its cloud all on an on-demand basis are unmatched in the industry, he says. AWS has multiple different database offerings, from its Relational Database Service (RDS) to DynamoDB, a non-relational key-value store database. Last year, the company rolled out a data warehousing offering named RedShift, and the company has a network of Elastic Load Balancers (ELBs), Elastic Block Storage (EBS), and application and management tools for deploying applications and configuring cloud architectures. Its partner system allows customers to run enterprise-grade applications from SAP, Microsoft, Oracle and dozens of other companies in its cloud.

Burns says Amazon could have the potential to take some hits from other providers on the lower end of the market where it is facing increased competition, and there is a growing market of IaaS providers each looking to carve out a niche of its own in the market on these basic services. Microsoft, for example, claims it is one of the only companies to offer a true “hybrid cloud” offering between its on-premises Windows Server and Microsoft Azure cloud. Rackspace offers “fanatical support” and has been broadening its database offerings recently; Joyent and ProfitBricks are among the cloud providers that focus on high-performance computing, while a company like FireHost emphasizes security in its cloud.

AWS is responding in turn, though. During the past few months AWS has begun incorporating the differentiating features of competitors’ services into its own cloud offering. In the past few months AWS has rolled out the following updates, for example:

-Trusted Advisor: A service that monitors customers usage, recommends ways to save money by using more appropriately sized resources and provides advice on how to improve security and reliability. AWS launched Trusted Advisor last year, but recently updated it with a new user interface and more detailed reporting information for customers. During the AWS Summit, Vogels said AWS has helped customers save $22 million through Trusted Advisor. “We’re actually advising our customers to spend less,” he says, explaining that customers who more efficiently use AWS resources will be more successful and be AWS customers longer. This service flies in the face of not just Rackspace, which emphasizes customer support, but also an ecosystem of third-party tools that provide real-time analytics of AWS services.

-AWS OpsWorks: One of the lingering questions about Amazon’s moves in recent years: Is the company turning its market-leading IaaS offering into a platform as a service (PaaS)? The biggest difference between the two is that IaaS is where applications run, whereas PaaS is generally where applications are developed.

AWS has a variety of PaaS-like offerings in its cloud, with the latest being OpsWorks, which makes it easier to configure AWS resources to run applications in its cloud. These complement services like AWS CloudFormation, which is helpful for tying various AWS services together, and Elastic Beanstalk, which helps users uploading applications to its cloud.

-CloudHSM: In an effort to beef its security practices, Amazon announced CloudHSM (Hardware Security Module) last month, an appliance used to store encryption keys that only AWS users have access to. The month before, AWS announced that the default setting for new virtual machines in the EC2 service would be “virtual private clouds” (VPC), meaning they are logically isolated virtual machines through network segmentation. Vogels said today at the Summit that security, and encryption especially, would be a focus of the company’s moving forward, and the HSM and VPC announcements seem right in line with that.

That doesn’t include a variety of other announcements the company has made, including new features for its RDS database, allowing users to scale up and set predefined input/output per second (IOPS) of up to 30,000 per database instance. AWS rolled out support for Hyper-V virtualization platform from Microsoft for its storage gateway, which work to synchronize data between customers’ premises and the Amazon cloud. Just today at the Summit, AWS announced new analytics tools for its DynamoDB non-relational database, and new encryption features for Oracle relational databases running in its cloud.

Mark Levitt, who tracks the enterprise cloud market for Strategy Analytics and attended the AWS Summit today in New York, says Amazon trotted out enterprise customers to discuss how they’re using AWS cloud services. Representatives from Bristol-Meyers Squibb, General Electric and NASDAQ all spoke about their use of the Amazon cloud. Following up on recent reports that the CIA is paying $600 million to Amazon to help build a private cloud, Levitt says the product enhancements, combined with the customer case studies, give more credibility to Amazon making the case that it is a viable public cloud provider for the enterprise market.



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IT’s new concern: ‘Bring your own cloud’

As personal and professional clouds converge, IT’s mission to improve productivity while protecting corporate apps and data is getting tougher.

Bring your own device is so 2012. The next big push in the consumerization of IT is bring your own cloud. And just as when consumer devices poured into the enterprise, many IT organizations have already responded with a list of do’s and don’ts.

The standard approach has been to forbid the use of personal cloud applications for business use, by offering official alternatives — the “use this, not that” approach — and to carve out separate cloud storage workspaces for business documents that can be walled off, managed and audited. But personal cloud services are difficult to control, and users are adept at going around IT if the productivity tools in their personal cloud can do the job easier, faster and better. IT wants a bifurcated approach to consumer and professional cloud apps and storage. But users don’t work that way anymore.
Getting Around IT

Scott Davis, CTO of end-user computing at VMware, originally began using a personal cloud app for business after the IT organization failed to offer a viable solution that met his needs. Davis, who has speaking engagements all over the world and needs to share large multimedia presentation files, asked for an exception to VMware’s email attachment size quota. IT responded first by suggesting that he pare down the content and then followed up by suggesting that he buy “a bag full of USB drives” to send presentations by mail.

“That’s when I started using Dropbox,” he says. “IT has competition. People know what’s out there and how to get the job done if IT doesn’t help them.”

Gartner analyst Michael Gartenberg agrees. “IT has to deal not only with bring-your-own devices but bring-your-own services,” he says. People will bypass even viable alternatives if they feel that the officially sanctioned professional cloud offering isn’t equal to the task — or if they have a personal cloud app they like better. “If it’s digital and it’s consumer, it’s going to find its way into the office. People will come up with reasons for using it,” he says.

At construction management firm Skanska USA Building, employees are mashing up business and personal work on a wide range of personal cloud services, including Dropbox and Evernote. Today, says senior enterprise engineer Jeff Roman, “We don’t control that.” But IT is actively reviewing its options. “What are we going to limit? What can they access at work and at home?” he asks. Right now that’s controlled by use policies that employees must follow as to what types of documents need to stay out of the cloud and what’s permissible. For example, financial data “should never touch a cloud service,” he says, nor should some documents relating to government projects.

But Skanska is also looking for an officially sanctioned cloud storage option. It is considering Microsoft’s SkyDrive Pro, using Citrix’s ZenMobile to provide virtual access to files stored on back-end servers, or using niche services such as Autodesk Buzzsaw, which puts construction design tools and documents in the cloud. “We don’t need people using all of these different tools,” he says, but any solution must be as easy to use as the personal cloud tools employees rely on. Otherwise, users are likely to bypass the official alternative.

“It will be tough to find a one-size-fits-all solution,” he says, “but we’re working on it. I am hopeful that within the next year we will have one in place, whether that is on-premises or cloud or a hybrid of both.”
Blurring the Lines

Organizations need to develop a three-pronged strategy for on-premises, off-premises and cloud, says Jim Guinn, managing director at consultancy PricewaterhouseCoopers. “You really need to pay attention to how you secure documents that are in someone else’s cloud-based service,” he says.

Roman says some documents just don’t belong in popular cloud storage services. “I’ve read the whitepapers on Dropbox and Box. I guess they’re secure,” he says. But for sensitive documents, he adds, “we don’t want to risk it.”

Even the issue of who owns business applications and how those applications are licensed is blurring. Evernote for Business, for example, adds a business services layer that includes policy-controlled business notebooks and adds business document libraries to the user’s personal Evernote account. Personal and professional documents reside in different repositories but with a unified view.

“We’re seeing a transition from two completely separate worlds to a world where there is no line between what’s good for personal and what’s good for business,” says Andrew Sinkov, vice president of marketing at Evernote. And if the user leaves the organization, the account — sans business documents — goes with him. “This model is little understood but I think will have a profound impact,” says Frank Gillett, an analyst at Forrester Research.

With Office 2013 and SkyDrive, Microsoft has taken a small step toward creating a unified view of the user’s personal and professional worlds. It has created synchronized, local versions of the user’s SkyDrive and SkyDrive Pro (SharePoint document library) storage repositories that exist as separate folders on the user’s local desktop. In this way, Office 365 can create and modify documents in the cloud, Office 2013 can read and write to the same files in a local folder, and all changes will be synchronized. “There’s a convergence happening from the user’s point of view,” says Microsoft storyteller Steve Clayton.

This strategy gets around the modal approach to personal and professional workflows — the two-car-garage model where the user must back out of one account bay and enter another to view and edit documents. Office applications can save to either folder. And if the user copies a document from his personal SkyDrive folder into the SkyDrive Pro folder, that file will be copied back to the cloud, where the policies for that document library will apply.

But only in the cloud. While IT can control which files users can sync with SkyDrive Pro, the cloud service can’t control what users do with the locally stored versions of those files. Users either must work with sensitive files in the cloud only or use Office 2013’s Information Rights Management feature to control forwarding, copying or printing of specific documents.

“Clearly, there’s a lot of change coming where IT has to integrate these [personal cloud services] into the current stack and figure out how it will work together,” says Amit Singh, president of the enterprise unit at Google, which in recent years has added enterprise features to consumer-based cloud applications such as Google Docs. With the latter, individual documents can be shared between the controlled, auditable professional account and the user’s personal account. But Docs offers no unified document view. On the other hand, Google Plus, Singh says, “was imagined as a semipermeable layer where we add controls for the enterprise from the bottom up.”


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How to Know When to Hire Internally and When to Look Outside

In a perfect world promoting internally is a good way to lower costs, create a talent pipeline and build morale. However, in the real world, you must weigh those benefits against the need to get the right skillset for the job.

Finding and retaining top talent is a never-ending battle in a market as competitive as IT, which according to BLS stats boasts a 3.5 percent unemployment rate compared to the national average of 7.5 percent. A well-planned recruitment and retention program is the difference between success and failure. “Always be recruiting,” says Ron Lichty, co-author of Managing the Unmanageable, “We consider recruiting and hiring to be the most important tasks a manager has.”

Hiring the wrong person, whether it’s due to a bad cultural fit or skillset, can have a huge impact both in your department and on the company as a whole. In a recent survey by Harris Interactive conducted on behalf of CareerBuilder, 6,000 multi-national hiring managers and human resource professionals were asked to estimate the effects and costs of a bad hire. The results may surprise you:

Self-evaluation Tips
27 percent of U.S. employers reported a single bad hire costs more than $50,000.
29 percent of those surveyed from Germany reported that bad hires cost $65,231 or more.
27 percent from the U.K. say a bad hire costs more than $77,849.86.
29 percent of Indian employers reported the average bad hire cost more than $37,150.
48 percent of employers in China say a bad hire cost on average $48,734.

Related Story: 6 Skills, Habits and Traits of Successful CIOs
Traditionally, according to Dan Schawbel, author of Promote Yourself: The New Rules For Career Success, hiring externally was preferred. Companies like the idea of hiring people away in an effort to infuse the company with new talent, perspectives and ideas–not to mention insider data from the other team–but as the economy turned down in 2008, companies began to look for ways control costs and hiring internally started to make more sense.

4 Reasons to Hire Internally

1. It Costs Less
Most companies are struggling every day, trying to do more with less and that includes HR. As it turns out, hiring internally is cheaper. According to data from the Saratoga Institute, it costs on average 1.7 times more to hire externally than internally ($8,676 vs. $15,008). That’s a difference of $6,332. Saving money is usually close to the top on everyone’s list.

Another study, from Matthew Bidwell, assistant professor at Wharton, titled Paying More to Get Less: The Effects of External Hiring versus Internal Mobility, also found that external hires make on average 18 percent more than internal hires.

2. It’s Faster
Lost productivity from an open position can cost major dollars depending on the position. Having an internal pipeline of talent makes hiring more fluid. It typically takes three meetings to hire externally, according to Schawbel: one phone or Skype interview, then one in person and then the final interview.

Related Story: 11 Profiles in Bad Leadership Behavior

“The hiring process is much quicker. With an internal hire it can take a few weeks but with an external hire it can take months,” says Schawbel. If you hire internally you already have a reputation and performance record. There’s also no background check needed, notes Schawbel. Another consideration: It takes internal hires less time to get up to speed. They already have a solid contextual knowledge of how things are done and a network to help them do it.

“You don’t have to devote as much time to training–the person already knows the environment–so you can focus purely on getting him or her up to speed in their new role,” says Tracy Cashman, Partner and General Manager in the Information Technology Search division at WinterWyman.

3. Hiring Internally Builds Morale
“You can be a hero if you consistently look to promote or hire from within. The best managers are always looking for ways to enhance their staff’s careers,” says Cashman. The top talent is not only concerned about doing the best job possible they are also concerned about their career trajectory.

One of the top reasons people leave their job is because they feel there is no room for advancement. However, when there is a career path and clear expectations on what it takes to get to the next level employees will have less interest in moving on. “It helps with retention; employees see a path upwards and job security. That loyalty is rewarded,” says Doug Schade, principal consultant, technology search at WinterWyman.

Another salient point: An internal hire is already a known quantity. “You already know the person fits the culture; otherwise, you wouldn’t be considering them,” says Cashman.

4. Internal Hires Have a Better Success Rate

The Saratoga Institute study also revealed that 40-60 percent of external hires aren’t successful in their new role as opposed to 25 percent hired internally.

The research done by Bidwell agrees, reporting that external hires receive lower performance reviews for the first two years of employment. Bidwell’s research indicates it takes this long for external hires to build an internal network and to learn the inner workings of the company. The end result is that internal hires reach their potential faster.

Bidwell’s research also indicates that there is 61 percent higher rate of terminations/layoffs and a 21 percent higher rate of voluntary exits for externally sourced employees. Numbers like that demonstrate one of the reason companies may want to start building an internal talent pipeline.

3 Reasons to Hire Externally

1. Finding the Right Skillset for the Right Job
“If you have an open or newly created position and just don’t have the talent in your organization to support that position, then you have to go externally,” says Schawbel.

Perhaps the cost in time and resources to get someone up to speed for particular role may be more than you can afford. “Productivity can stall with multiple internal employees learning new roles or taking on new work to help facilitate the change,” says Schade.

For example, maybe you only have one Java developer. If he/she moves on, is it easier to train a .NET person to learn Java or bring in a new Java person? “If it’s a niche or particularly important role, sometimes you are better off trying to get someone from the outside rather than spending time and money on training,” says Cashman.

2. Getting a New Perspective
Today’s CIOs and IT pros are expected to be agents of change. In a situation in which a company is looking to make a paradigm shift in how it approaches certain aspects of the business, it may opt to hire externally. “Fresh blood can often revitalize a team, and it’s good to bring someone in who has new ideas and a different perspective,” says Cashman.
3. External Hires More Experienced and Better-Educated

External hires normally have more experience and have a higher level of education, according to Bidwell’s research. The study also indicated that although external hires are at a higher risk of failure, the ones who do make it through the first two years are promoted faster than those hired internally.

What Does It Take to Hire Internally?

To be successful at hiring internally, Schwabel says, you need two things: a solid corporate culture and the right people. “Companies have to focus more on corporate culture and company branding in order to attract and maintain the best people,” he says. Once that is in place and you have an internal hiring program that is supported and communicated to the employees your retention should increase, according to the experts.

Create a Long-Term IT Hiring Plan
Creating an internal hiring policy takes time and C-level buy-in. It’s a long-term approach to better retention and cost savings. In the real world, however, the state of your corporate culture as well as the business and technological objectives you face all play a part in the decision to hire internally or externally.

Whether you choose to go external or stay inside the company, the bottom-line is to get the best people and retain them. “The best way to hire the right people is to communicate your brand online and offline through all the touch points and to also have a strong corporate culture so when people get there, they want to stay,” says Schawbel.

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Microsoft votes for free Windows 8.1, collects kudos

If Microsoft proves annual updates are easy to deploy, OS could get its chance in the enterprise

Microsoft today announced that Windows 8.1, the update later this year for Windows 8, will be free to current users of the operating system, confirming analysts’ expectations.

Analysts applauded the decision to give away the update. “Making the upgrade free will make the ecosystem and installed base very happy,” said Patrick Moorhead, principal analyst with Moor Insights & Strategy, in an email Tuesday.

Tami Reller, CFO of the Windows division, made the announcement in prepared remarks at the JP Morgan Technology, Media & Telecomm Conference today. “Windows 8.1 will be delivered as a free update to Windows 8 and Windows RT,” said Reller. “It will be easy to get right from the Windows Start Screen from the Windows app store.”

It’s unknown whether Microsoft will use the “Windows 8.1” name for the simultaneous update to Windows RT, the tablet-centric offshoot designed for devices running ARM processors. Microsoft did not reply to questions about the naming of the Windows RT update.

Reller declined to provide additional information on the update, such as the timing of the final release or specifics on Windows 8.1’s contents.

A public preview will ship during BUILD, Microsoft’s developers conference, which will run June 26-28 in San Francisco. That preview will also be distributed through the Windows Store.

Earlier this week analysts said that Microsoft had little choice but to offer the update free of charge.

Today, industry experts praised the gratis status of Windows 8.1 as well as the numbering choice.

“Microsoft made a good move on the naming and with the free upgrade,” said Moorhead. “Calling it 8.1 signals that it’s an improvement on its predecessor, not a sea change. This sets the right expectations.”

However, Michael Silver of Gartner said Microsoft should quickly answer several up-in-the-air questions that enterprises have about Windows 8.1.

“We don’t yet know what they’re going to do to the desktop,” said Silver, who also ticked off support — specifically, how long Microsoft will support each of the expected annual updates. Will Windows 8.1 share the support lifecycle of its parent, Windows 8 — which won’t retire until January 2023 — or have its own schedule? “Will they support 10 different updates?” Silver wondered.

But the fact that Microsoft will make good on its promise to shift to a faster release tempo had Silver more optimistic about Windows 8’s future.

“Microsoft has a chance here,” he said. “By the second half of 2014, there will be a lot more touch-enabled systems. That, and these updates, could help Windows 8 long term. I don’t think Windows 8 will be more successful than Windows 7 [in the enterprise] but if 8.1 is easy to deploy, that could change over time.”

Most important to enterprises, said Silver, will be the ease of updating from Windows 8 to version 8.1. If the first “point” release is painless to distribute to Windows 8 hardware, Microsoft will have a better shot at convincing enterprises to adopt the radical OS.

“If enterprises see that this is relatively easy to deploy, they may start thinking about Windows 8,” Silver said. “What Microsoft needs to do is get some credibility here.”

After Microsoft moved to a regularly-scheduled Patch Tuesday in the fall of 2003, companies instituted a complicated process of testing and spot-deploying the updates before rolling them out en mass, said Silver. But as time went on, many halted the practice as they became confident the patches would not cripple computers or break applications.

“Now, very few organizations do that,” Silver maintained. “Microsoft needs to gain that kind of credibility for these [Windows 8] updates.”


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Microsoft says Yammer sales are booming

The enterprise social networking’s product revenue grew 259 percent year on year in the quarter ended in March

With the backing of its new parent company, Yammer more than tripled its revenue year on year in the quarter that ended in March.

Sales of Yammer’s cloud-based enterprise social networking (ESN) software shot up 259 percent in Microsoft’s third fiscal quarter, compared with the same quarter in 2012, when Yammer was still an independent company, Microsoft said on Thursday.

Microsoft isn’t disclosing Yammer’s revenue in dollar figures, but the growth and momentum — Yammer added 312 new customers in the quarter — is a validation of the US$1.2 billion it paid for Yammer last July, a Microsoft executive said in an interview.

“We’re really pleased with the acquisition, with the process of the teams coming together and with the continued customer acceptance and demand,” said Jared Spataro, senior director of the Microsoft Office Division.

“There are always questions after an acquisition, like, ‘How is it going?’ There’s a worry about cultures clashing, and about products and strategies coming together,” Spataro said. “When we did the acquisition, we talked a lot about how it would accelerate Yammer’s momentum. So this is a great data point to demonstrate how well things are going in general.”

Spataro specified that to calculate the revenue spike, Microsoft considered only sales of standalone Yammer licenses, and left out revenue coming in from Enterprise Agreement volume licensing deals involving the ESN product.

It should also be noted that after the acquisition, Microsoft eliminated Yammer’s Business edition and slashed the price of the more sophisticated Enterprise edition from $15 to $3 per user per month, so in this year’s quarter Microsoft generated significantly less revenue per license than Yammer did in the prior year’s quarter.

Microsoft expects Yammer sales to get another boost this summer when the Yammer sales team is merged with Microsoft’s global salesforce, boosting the number of reps pushing Yammer from about 100 today to thousands worldwide.

As a frame of comparison, worldwide revenue for enterprise social collaboration software grew about 25 percent in 2012 compared with 2011, according to Michael Fauscette, an IDC analyst.

Another market benchmark is Jive Software, a publicly traded ESN vendor, whose revenue grew 34 percent to almost $34 million in the quarter that closed at the end of March.

“Clearly with this announcement Microsoft is trying to put a certain amount of validation out there that says they made a good acquisition, because some people thought they had overpaid for Yammer,” Fauscette said.

Looking back, it’s clear to Fauscette that Microsoft picked the best ESN product available at the time, and that so far the acquisition appears to be working well for both parties.

Microsoft bought Yammer primarily to boost the ESN features in its all-purpose and ubiquitous SharePoint enterprise collaboration server, which has an on-premises version and a cloud-based version called SharePoint Online that is part of the broader cloud email and collaboration suite Office 365. The newest on-premises version is called SharePoint 2013.

Integration of Yammer and SharePoint is grinding along and will take probably two years to complete. In March, Microsoft offered an integration road map that calls for Office 365 customers to get the option this summer to replace SharePoint Online’s activity-stream component with Yammer’s, a modest, basic first integration point.

Also by this summer, Microsoft will deliver a Yammer application that will let users embed a Yammer group feed into a SharePoint site. This Yammer application, which will be available in the SharePoint app store, will work both with SharePoint Online and with SharePoint 2013 servers installed on a customer’s premises. Microsoft will also make it possible for customers to replace the newsfeed in SharePoint 2013 servers installed on premise.

Later in the year, the integration will deepen with a single sign-on and the inclusion of Yammer in the Office 365 interface. Yammer will also gain integration with Office Web Apps, the browser-based version of the Office productivity suite, before the end of the year.

Next year, Office 365 customers can expect integration between Yammer and other Office 365 components beyond SharePoint, such as Lync and Exchange. Yammer is already being integrated with Microsoft Dynamics enterprise software.

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FAQ: What you need to know about cloud computing’s hidden tax hit

KPMG LLP tax expert Reid Okimoto speaks to state tax burden of cloud computing and questions you should ask before buying

Cloud computing services, both software as a service (SaaS) and infrastructure as a service (IaaS), are subject to taxes, whether your cloud provider tells you or not when you purchase them. Reid Okimoto, senior manager in the state and local tax practice at KPMG, shares tips to help you understand the real cost of cloud computing.

Q: What questions should companies buying cloud services be asking about state and local taxes?
Reid Okimoto
Reid Okimoto, senior manager, state and local tax practice, KPMG

A: One major question is, “Is it subject to sales tax?” If sales tax isn’t clearly charged by the cloud provider, the customer may still be subject to ‘use tax.’ IT-focused professionals and their enterprises are consuming and purchasing cloud services and they’re normally dealing with sellers and vendors of cloud services, not necessarily those familiar with the “taxability of services.” Questions to ask the seller of the cloud services: “Are you charging sales tax or not?” If the answer is no, the next question is, “Why not?” It could be either that the provider does not have nexus or that the service is not taxable. This answer makes a difference to the consumer.

Q: So what happens with taxation and “nexus,” which means a connection or link?
A: The concept of “nexus” determines who has the obligation of collecting and remitting a sales tax. Nexus is not synonymous with taxability. If the vendor has nexus in the state and the cloud service is taxable in the state, it should collect the sales tax. If not, the consumer will be responsible for self-accruing and remitting.

Q: State taxes vary, with some at 8% or even more. You note that state policies regarding taxation of cloud services also vary. Would you give us some examples?
A: New York imposes sales tax on many cloud services. California, in the majority of cases, does not tax cloud services. By contrast, a state like Washington shifts the burden of self-accruing and remitting the use tax from the cloud service provider to the consumer. States that offer multiple points of use exemptions for multi-state users of cloud services are preferred to those that impose sales tax of 100% of the purchase price based on the billing address. Imposing sales tax on 100% of the purchase price based on a billing address makes it likely that more than 100% will be taxed or nothing will be taxed. Taxpayers are always concerned about getting “whipsawed” by two competing states’ taxing policies.

Q: If you don’t go into this fully understanding the tax situation with cloud services, what might come back to haunt you later?
A: A state auditor does periodic audits of companies and they will require you to prove that sales tax was charged and paid appropriately. You may need to prove this by showing them your invoices. Also, your financial statement auditors may inquire about contingent sales or use tax liabilities on the sale or purchase of cloud services. This could result in a contingent liability being placed on the balance sheet. Another reason to keep straight on the cloud-tax issue is that when companies are sold or recapitalized, they typically go through a “due diligence” process with the buyer to “scrub” companies for all liabilities, including tax liability. If there’s a lot of liability, there will be a “failed process” question.

Q: What more do business professionals need to think about here?
A: Clear guidance on taxability and sourcing of cloud services creates predictability from a business investment standpoint. States that do not provide clear guidance put cloud service providers in an awkward position, stuck between a possible state tax audit or False Claims Act allegation for under-collecting and a possible class action lawsuit for over-collecting.

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Opera sues ex-employee for $3.4M over alleged trade secrets violation

Opera sues ex-employee for $3.4M over alleged trade secrets violation
Noted Norwegian developer accused of sharing Opera’s secrets with rival Mozilla

Trond Werner Hansen, the designer of some of the Opera Web browser’s signature interface features, has been sued by that company in Norway for 20 million kroner ($3.4 million).

The initial report, from Norwegian publication Dagens Naeringsliv, says that Hansen is accused of revealing Opera’s trade secrets to rival browser maker Mozilla, and that the case centers on a video detailing new interface design ideas.

Trond Werner Hansen
Trond Werner Hansen, via Twitter

During Hansen’s time at Opera, he says in a blog entry, he helped create features like tabbed browsing, speed dial, integrated search and mouse gestures — many of which have become more or less standard in modern browsers.

Hansen told DN that news of the lawsuit was “sad” and “incomprehensible.” He worked at Opera from 1999 until 2006, and came back as a consultant for a second brief stint from 2009 to 2010. The latter period saw him working on a project that incorporated design concepts from a proposed browser he’d been working on in his spare time.

Hansen describes his “green browser” concept (or GB) as being similar to what Google eventually came up with in Chrome — a stripped-down, open source WebKit browser with a unified search and address field — but with the addition of a feature that would allow revenue from search providers to go to environmental causes.

Opera founder and CEO Jon von Tetzchner wanted Hansen to develop GB for his company, but balked at the idea of paying 1% of search revenue instead of salary or shares. The two settled on Hansen simply acting as a consultant later — which means, he writes, that the initial proposal to bring GB into the Opera fold was void.

Opera has declined to comment on the case, citing the pending trial, and referred inquiries to lawyer Ole Tokvam, of the firm of Bing Hodneland.

The competition between Opera and Mozilla is so fierce, according to IDC analyst Al Hilwa, because the two companies both make cross-platform browsers and have an interest in the mobile space.

“Platform owners like Apple, Google and Microsoft will always put their browsers first, so Opera and Mozilla have to work harder and innovate faster to make their technology attractive. It is why we have seen Mozilla make a big effort to launch a mobile OS and we may well see Opera do something similar. The lawsuit we are seeing shows some of the stresses of this competition,” he says.

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MCPD Web Developer exam 70-547 hints and tips

Following my post about studying toward
MCPD certification,
I’ve now taken the exam and am pleased to say I passed with a good score. The
exam 70-547 is about designing and developing web applications using ASP.NET
2.0. It focuses on the full software development lifecycle and covers planning,
architecture, design, testing and deployment, where as the prerequisite MCTS
exams cover more of the actual coding and implementation details.

My main study guide was the official Microsoft Press book, MCPD Self-Paced
Training Kit (Exam 70-547). It covered the syllabus thoroughly enough to get me
through the exam, but like most similar books wasn’t much fun to read. It’s over
700 pages, and after the first few hundred the content starts to get fairly
monotonous. It’s also difficult to skim because you might miss something
essential for the exam. If you’re an experienced developer then you might not
learn much, but if you’re new to coding then you should find plenty of useful
information about broader areas of software development, such as architecture,
data modelling and unit testing.

A lot of the testing chapters read like an advert for Visual Studio Team System
(VSTS) and aggressively promote its unit testing and web load testing
capabilities. There’s nothing wrong with that, it’s a Microsoft exam after all,
but you will need Visual Studio Team Test if you want to work through the
practical exercises (an evaluation version is available). The unit testing in
VSTS is impressive, but doesn’t seem to offer much over the freely available
NUnit. The web load testing on the other hand is invaluable.

My best advice for the book is to read it in short frequent bursts. Try to read
a little bit every day and you’ll easily work through it, so don’t be
intimidated. If you find yourself slacking, just register for the exam and

you’ll soon become motivated. And remember to use the 15% exam discount voucher
that comes with the book.

My other study resource, which I also used for the
MCTS exams, was
the practice test from Microsoft. The questions are very relevant to the
actual exam, and helped highlight areas to focus my study. The most useful
feature is that every answer has an explanation, so if you get one wrong you can
see why and hopefully fill a gap in your knowledge.

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The exam isn’t easy, but many questions appeal to common sense as well as
technical expertise, and there aren’t any trick questions. There’s more than
enough time to work through the 40 multiple-choice questions, so be careful to
read each one closely and don’t panic. Some questions ask you to pick more than
one answer so follow the instructions carefully. The passing score is 700 out of

According to Microsoft’s statistics there are only 2,147 MCPD web developers
worldwide, so if you want to improve your skills, stand out in the job market,
or negotiate a promotion then certification could be a great career move.

My next goal is MCTS certification for SQL Server and exam 70-431. Then it
shouldn’t be too long before the next generation of .NET 3.5 MCTS are available.

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