Daily Archives: June 27, 2006

Southern California Catching Up to Northern California in Tech Jobs

The Los Angeles area always had Hollywood glamor, and now it’s gaining in nerd appeal.

According to the California Cybercities 2006 report from AeA (formerly the American Electronics Association), a trade organization for the high-technology industry, Southern California’s technology industry is nearly as large as Northern California’s. The authors of the report say Northern California employs 439,000 technology workers, versus 418,000 high-technology workers in Southern California.

California’s high-technology employment totaled 904,900 in 2004, down 10,600, or about one percent, from the year before. Job losses in California’s technology industry slowed in 2004, compared to the 67,800 jobs lost in 2003 and the 134,400 lost in 2002. That still totals job losses approaching 215,000 over the last three years for which statistical data is available.

Deja Vu at SGI

In a bid to rise from the ashes of bankruptcy, SGI today announced that it would broaden its product line to provide lower-cost options, including the introduction of an x86-based server.

Said an SGI marketing manager: "Obviously, one of the things we need to [do] is expand our market reach." She added that the new products "are very much part of our path back to profitability."

But haven’t we seen this show before from SGI? If I remember correctly — and, surprisingly, in this particular instance, I do — SGI originally attempted to repel commoditization in the visual-computing marketplace back in the bad-old 90s by joining the league of hardware vendors designing and selling industry-standard workstations and servers based on Intel microprocessors and Microsoft’s Windows operating system.

It didn’t turn out all that well for SGI the first time, and there’s no reason to believe it will resolve itself any differently today, even though they’re using Linux instead of Windows this time around. Some companies, such as Dell, are built to make thin margins on huge volumes of box shipments. Others, such as SGI, were build to charge a premium and reap higher margins for exclusive, research-intensive features and functionality that cannot be obtained from run-of-the-mill workstations and servers.

However, as the industry-standard boxes got faster, better, and "good enough" for a wide range of applications in visual computing, SGI found that its value proposition, and its higher prices, retained appeal for a rapidly diminishing audience involved with increasingly esoteric applications. 

It tried, back in the 90s, to remake itself as a lean, mean operational machine, selling industry-standard machines with a subset of its previous functionality, but SGI wasn’t built to play that game. The result was the perception of competitive capitulation, a damaged brand, and increasing irrelevance. It’s difficult to envisage how it will turn out any differently this time.

If the definition of insanity, according to Ben Franklin, "is doing the same thing over and over and expecting different results," then it’s time to summon the doctors in the lab coats to a former star of the technology firmament based in Mountain View.

New Boss, Same Fuzzy Strategy at Novell

As we suspected in our earlier post on the executive-suite overhaul at Novell, not much will change strategically under new CEO, previously COO and president, Ronald Hovsepian.

The company’s strategic direction, which essentially is an accommodation with a dog’s breakfast of products and services accrued through mergers and acquisitions, won’t change markedly. Hovsepian apparently believes there’s nothing scattershot about the current strategy, saying a "narrow focus and energetic push" are all Novell needs to get back on track.

Even if Hovsepian and his team, which will undoubtedly go through some personnel changes, improves the operational and field execution of Novell, it won’t end happily for him or for his company if Novell plots a nebulous strategic course.

Comcast Fires Drowsy Service Technician

Comcast Corporation fired a service technician on Monday who fell asleep on a customer’s couch after spending an hour on the phone waiting in vain for his own company’s customer service.

Videotape of the sleeping technician, who had visited the customer’s residence to replace a faulty cable modem, had been posted on YouTube.com, costing Comcast great embarrassment and the technician his job.

There’s no word on whether Comcast fired any of its tardy customer-service representatives, who appear to have given the customer nothing but grief before the narcoleptic technician finally made an appearance.