The Siebel Observer
January 20, 2004

Special Edition

NEWS

Offshore No More

Siebel Systems Q4 2003 Results Scheduled

SAP Announces Preliminary Results

Consumers Willing to Pay for Content

Jacada Validates Product for UAN

China to Set Up Software Centers

CRM Book Released

Siebel Scholars Chosen

Latest Chapter of Contact Center Book Available Online



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Siebel
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Events

The fourth annual Enterprise Software Summit takes place this year in Sundance, Utah from February 1st to February 4th. Among the topics covered:

  • The New Enterprise Software Business Model
    Premise vs Hosted and Perpetual vs Subscription
  • White Spaces in Software
    What is Left to Be Developed?
  • Consolidation
    Who is Likely to be Acquired?
  • Offshore Outsourcing
    Are the True Costs Fully Understood?

      -more-



      Technical Papers

      The Future of Employee
      Relationship Management

      Price: $50.00

      Implementing Siebel CTI

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      Working with EIM to Import Data Quickly

      Price: $50.00

      Basic Actuate Siebel Report Writing

      Price: $50.00

      Effectively Implementing Siebel VB/COM

      Price: $50.00

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      Allen Bonde Group

      Disclaimer

      The Siebel Observer is not
      affiliated with Siebel Systems, Inc.
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      Siebel Systems does not endorse Great
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      This is your guarantee the newsletter
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      of information.


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      Offshore No More

      The most controversial information technology (IT) issue of recent years is offshore outsourcing. While most debates in IT never go beyond industry publications, offshore outsourcing has become a topic in the popular press and even has even appeared in the political arena. In November Indiana Governor Joseph Kernan canceled a $15.4 million project with Tata Consultancy Services (a division of Tata Sons, the holding company of one of India's best-known business conglomerate) to handle the state's unemployment benefits system. And the issue is not restricted to the United States. Australian Treasurer Peter Costello recently warned the state-owned telecommunications company, Telstra, that it should try to ensure that the 450 software jobs it was planning on outsourcing to India will remain in Australia.

      Despite the scale of the debate, the number of jobs actually being outsourced remains small. According to a December 2003 Forrester report, "Users' Offshore Evolution and Its Governance Impact," most firms are either doing nothing or just starting to outsource. Forrester estimates that 60% of the Fortune 1,000 has no offshore experience, another 25 -30% use offshore vendors, but they are not a key part of their overall IT strategy or spending plans. Only a small group, 5%-10%, have scaled up offshore outsourcing and less than 5% take complete advantage of it.

      Yet the temptation to send jobs offshore remains huge. In China the average information technology professional earns $8,900. In Russia the going wage is $6,000 and in India only $5,800. And there is no shortage of qualified workers. India will be graduating 300,000 new engineers this year. Many analysts argue that to remain competitive, western companies must continue to drive innovation and cut costs.

      Some of the biggest critics of offshore outsourcing are those who have actually experienced it first hand. They point to time differences, rising salaries and overall difficulties in managing projects remotely as reasons why offshore outsourcing is not a panacea. Taking another perspective, many academics reassure us that new jobs will take the place of programming jobs shipped to Asia. One who is particularly well placed to make these observations is Professor Philip Windley of Brigham Young's Computer Science Department. As the former CIO of the State of Utah, Windley points out that most CEOs are screaming for the automation of processes and support for business activities while most IT organizations are struggling with hooking networks together, managing desktops, and administering databases.

      As he points out in his Enterprise Computing Web Log (http://www.windley.com/2003/12/23.html#a961), "What's getting outsourced? The IT equivalent of coal mining jobs. My undergraduate degree is in metallurgical engineering and I've spent some time in mines. It is dirty, but high paying work that doesn't require much formal education. People love it."

      In order to understand the issue better, we are devoting an entire session at The Enterprise Software Summit to the issue of offshore outsourcing. For those unable to attend the event, an audio recording of the session will be available after February 5th on the events web site http://www.enterprisesoftwaresummit.com.

      Graph Logo

      Siebel Systems Q4 2003 Results Scheduled

      Financial results for the fourth quarter of 2003 has been scheduled for January 21st by Siebel Systems. Since the company announced preliminary results on January 5th, most of the customary conference call will address additional financial, customer and market data. One question sure to be on analysts' minds is, Where in the world is Rich Chiarello?

      The call is scheduled for 2:00 p.m. PST and can be accessed over the Internet at www.siebel.com/investor or by calling 1-706-679-7563.

      SAP Logo

      SAP Announces Preliminary Results

      SAP announced preliminary results in line with consensus estimates; this could prove disappointing to some investors who may be expecting more after Siebel Systems' strong results. SAP shares currently trade at P/E ratio of 33 - a premium to ORCL's 28, PSFT's 26 and Siebel's negative ratio.

      Consumers Willing to Pay for Content

      According to CBS/Marketwatch's Bambi Francisco, consumers are increasingly willing to pay for content, unlike during the early commercial days of the Internet.

      In an article titled "Net companies to launch TV ads," Francisco points out that EDiets is expected to grow fourth-quarter sales by 44 percent to $10.5 million based on subscriptions. Yahoo reported that earnings, including Internet access fees and online dating subscriptions, rose 37% to $85 million in the fourth quarter.

      According to the Online Publishers Association, consumers spent $748 million in content in the first half of 2003, up 23%, with online dating, business investment and lifestyles accounting for two-thirds of what people pay for on the Net.

      Jacada logo

      Jacada Validates Product for UAN

      The Jacada Integrator 4.0 has been validated with the Universal Application Network (UAN) - the Siebel standards architecture for business integration. The integrated solution combines best practices from both Siebel Systems' library of integration applications and Jacada's approach to integrating mainframes with midrange computing systems.

      Championed by Siebel Systems, the Universal Application Network (UAN) is an architecture for creating business processes that span applications. As part of UAN, Siebel Systems provides packaged software - Siebel Business Integration Applications - which provide pre-built integration processes that significantly reduce the cost and complexity associated with traditional integration methods.

      Joint customers of Siebel Systems and Jacada benefit from accelerated integration of legacy systems with other enterprise applications, which promise to reduce costs. By incorporating legacy data within existing business processes organizations can access data that is otherwise difficult to access.

      "With over 40 joint customers with Siebel, Jacada is uniquely qualified to deliver universal legacy integration between UAN and a wide range of legacy applications," said Duffey.

      Jacada customers include AIG, Bank of America, Caterpillar, Citibank, Delta Air Lines, The Federal Reserve Bank, Porsche Cars North America, Prudential and the US Department of Interior.

      China to Set Up Software Centers

      Taking a page from Indian software development efforts, China will set up five software centers across the country to boost exports.

      The plan is the joint work of the State Development and Reform Commission, Ministry of Information Industry and Ministry of Commerce.

      The centers will be based in the eastern commercial port of Shanghai, the northeastern city of Dalian, the southern city of Shenzhen, the northern municipality of Tianjin and the northwestern city of Xi'an. Under the plan the State Council and local Governments will grant preferential policies for skilled workers, technology and capital at these centers.

      According to Commerce Ministery, China exported $2 billion of software in 2003, up from $1.5 billion in 2002.

      Accenture Logo

      CRM Book Released

      Montgomery Research and Accenture (NYSE: ACN) are releasing a new book called Defying the Limits. The book examines how to improve operating efficiencies and increase economic impact by deploying CRM more competently.

      The fourth volume in the series, Defying the Limits contains a collection of white papers, case studies and customer profiles representing the thoughts and research of academics, analysts, consultants, end-users and vendors. Topics explored in this year's volume include how to apply more scientific methods to marketing and how to make customer interactions more profitable by examining past behavior.

      The book is available online at www.crmproject.com.


      Siebel Scholars Chosen

      The annual recipients of the Siebel Scholars award have been named. Five students from eleven US business and computer science schools will receive a $25,000 cash award to defray tuition costs and expenses for the second year of their graduate studies.

      To date, the Siebel Scholars Program has awarded scholarships of $25,000 each to 220 students at 11 schools of business and computer science.

      Names of this year's scholarship recipients and additional information can be found at www.siebelscholars.com.


      Citrix logo

      Latest Chapter of Contact Center Book Available Online

      To explore how to build a better return on contact center investments, Citrix Systems is sponsoring Building the On-Demand Contact Center with editorial assistance from The Siebel Observer.

      To read the latest chapter of Building the On-Demand Contact Center please click here. Correction




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