Wipro increases salary by 8 per cent

BANGALORE: Wipro, India's No. 3 software services exporter, said it raised wages for its employees in India by 8 per cent and for its overseas employees by 2-3 per cent effective June 1.

Earlier on Tuesday, the company forecast subdued IT services sales for the current quarter after posting an 18 per cent rise in quarterly profit that met market expectations on growth in outsourcing work.

The country's third-largest software firm Wipro today reported 18.37 per cent increase in consolidated net profit at Rs 1,580.2 crore for the first quarter ended June 30, 2012.

The company had posted a net profit of Rs 1,334.9 crore in the April-June quarter of last fiscal, Wipro said in a filing to the BSE.

The total income from operation during the quarter rose by 24.37 per cent to Rs 10,619.6 crore from Rs 8,538.4 crore in the year-ago period.

The company has also bagged a multi-year contract from Philips.

What does Dentsu's buyout of Aegis means for India?

The recent announcement of Dentsu's buyout of London-based Aegis is one of the most aggressive moves made by the Tokyo-headquartered advertising giant in recent times. The $5-billion cash deal by Dentsu points to how the agency is desperate to mark is ground outside of its home turf, perhaps due to a stagnating home market. Early last year, Dentsu bought out Indian partner Sandeep Goyal's 26 per cent share in its agencies in India as well - making way for more controlled operations. Recently, it brought in ex-JWT talent Rohit Ohri to head its operations here and has since been acquiring talent.

London-based Aegis, meanwhile, is one of the largest independent media agencies outside of communication networks such as the WPP group, Omnicom and Publicis. It has long been viewed as a potential acquisition target by many in the industry. Why? It had divested its stake in its market research arm Synovate to Ipsos last year. Aegis group's existing businesses include global media agency Carat, global digital marketing network Isobar, media communication specialist Vizeum and out-of-home division Posterscope, among others. It had introduced most of these businesses in India with Ashish Bhasin helming affairs for the region as Chairman India and as CEO of Asia-Pacific operations.

Dentsu's buyout, post all formalities, will eventually place it in a stronger position in India. Currently, more than 70 per cent of its revenues come from outside the Asia-Pacific region.  In India, the agency has many Japanese clients as well as several significant Indian brands served by three independent agencies here.

For instance, Dentsu Marcom India handles Honda cars & two-wheelers, Educomp, Canon, DS Group and Monster.com. Its second agency, Dentsu Communications India, handles Toyota, Panasonic, Indian Oil, Indo Nissin, Ingersol Rand, ICICI Direct, Jet Airways, Indian Air Force and some key Delhi Government's accounts. 

Its Dentsu Creative Impact, meanwhile, holds the accounts of Maruti Suzuki, Indian Navy and Tetrapak, among others. Together, the Dentsu group in India has a billing is in excess of Rs 1,200 crore and is counted among the Top 10 agencies in India. 

Aegis has brands like Philips, Reebok and Adidas - among others - in its portfolio.  The combination is likely to put the joint entity higher up on the list of agencies to be reckoned with.

Mah Satyam sounds caution on pay hike

Mahindra Satyam will go for a "tightening" on salary hikes this year as business environment is cautious.

"Salary hike is still under discussion. There will be well tightening (in salary hikes). That much I can tell. All I can say is as CEO, I will take pay cut if required," CEO C P Gurnani said. 

"My engineers, my managers and Directors of Board clearly understand that it is little bit of a cautious climate and within this cautious climate it is better to work together and work more as a team instead of trying to be bit extravagant. The mood is not extravagant and mood would be cautious," he added.

Last year, Mah Satyam which has an employee base of 33,000 offered 8 to 12 per cent salary hikes from October.

Sources said that this year pay hikes will be less than 10 per cent and by next month the company may announce its decision.

Guranai said employee appraisals are currently going on and the amount of hike has not yet been decided.

Replying to a query, he said as the economies of the US and Europe are not encouraging there may be some stressful days ahead.

"I think most of us are very cautious. Most of us are reviewing it (situation) on day to day basis. Most of us are not going to be adventurous or will be risk takers at this time. Whatever we do, we do with a fair amount of caution.

Eventually, it will restrict the IT spending (of governments or companies)," he explained.

On the Tech Mahindra-Mahindra Satyam merger issue, he said there are 13 taskforces with members from both the companies currently working for the integration of HR policies.

He, however, agreed that there could be some differences that could be sorted out.

"There is joint committee there are 12 or 13 task forces which are working on the integration challenges and those 13 task forces will make the recommendations to branding which includes levels designations and various policy measures in the company after merger," he said.

He said that as both the organisations started working together on many projects, integration among employees may not be a problem.

The combined entity is expected to have an employee base of around 75,000.

AOL reorganizes, creates three new groups

Company says that the move is designed to drive growth and profitability and that the three groups will be under the leadership of new COO Artie Minson Jr.

AOL announced two substantial changes to its business this morning.

First up, the company says it has promoted CFO Artie Minson Jr. to chief operating officer. In his new role, Minson will be in charge of three new units AOL that has established as part of a reorganization focused on "driving growth and improved profitability."

According to AOL, it's business will now be aligned in three distinct operating groups -- AOL Membership, Content Brands, and Advertising.com. All three operating units will report directly to Minson. A fourth group, made up of sales, technology, communications, brand marketing, and other support areas, will report to CEO Tim Armstrong.

AOL's Membership group will include the company's legacy products, such as access to AOL's Web services, AOL Mail, and AOL.com. The Content Brands Group will include the company's current content brands, including The Huffington Post and TechCrunch. As one might expect, the Advertising.com group will focus on business-to-business services and advertising.

AOL's reorganization is just the latest move the company has undertaken to improve its long-ailing business. This week, the company said that it will buy back up to $400 million of its stock in a Dutch auction. Current shareholders will have until August 2 to participate in the sale.

Whether the reorganization will improve AOL's standing in the online world, though, remains to be seen. For years and years, the company has been searching for a solution to its woes and has tried everything from hiring new management to acquiring online properties. Still, its performance has been middling, at best.

AOL says that it's currently working on "detailed profitability information" related to the reorganization and will present the data to shareholders by year's end.

Google launches alleged Amazon Web Services killer

Google has thrown down an Amazon Web Services challenge, but the service has a ways to go to match its rival on breadth and depth.

Google launched Compute Engine Infrastructure as a Service in a bid to offer cloud infrastructure much like Amazon Web Services. However, the effort, which is in a "limited preview," lacks the depth and options provided by Amazon.

In a nutshell, Google is allowing users to spin up virtual machines. Coupled with Google's App Engine, Google Apps, and Drive the company is building out its cloud stack.

Google's promise is that it'll provide all the access to its computing power to companies.

The idea of a cloud stack isn't exactly original. Amazon has focused on infrastructure as a service, but others offer a cloud menu of items. Everyone from Microsoft to Oracle to HP to IBM to VMware has a cloud stack.

Though details were sparse, Google indicated that it will try to win versus other cloud players based on raw performance.

For Google, its cloud compute effort could meld well with Google Docs, which will work offline in Chrome, and ultimately its Chromebook laptops, which will now be sold at Best Buy. Compute Engine and App Engine are seen as a good tag team to Google.

Urs Holzle, senior vice president for technical infrastructure at Google, outlined the company's infrastructure-as-a-service effort.

Holzle pitched the company's service levels, value, and performance and highlighted how adding 10,000 cores to a gene project moves analysis along. AWS has a similar case study.

According to Holzle, Compute Engine can offer "50 percent more compute per dollar" than other vendors.

Here's a look at Google's virtual machine pricing:

"We worked hard for a decade to lower the cost of computing, and we're passing these savings on to you," Holzle said to a roar of applause from the developers in the audience.

The price comparison to Amazon Web Services is a bit tricky. Amazon EC2 offers a free tier that includes

• 750 hours of EC2 running Linux/Unix Micro instance usage
• 750 hours of EC2 running Microsoft Windows Server Micro instance usage
• 750 hours of Elastic Load Balancing plus 15GB of data processing
• 30GB of Amazon Elastic Block Storage (EBS) plus 2 million IOs and 1GB of snapshot storage
• 15GB of bandwidth out aggregated across all AWS services
• 1GB of Regional Data Transfer

After that EC2 on-demand pricing goes like this:

Is Google's offering an Amazon Web Services killer? That outcome remains to be seen. Google has touted its number of cores, value, and Linux virtual machines. There's no doubt that Google's cluster and high-performance networking will be worth checking out.

Google's core compute services include:

• Compute with on-demand Linux virtual machines in one, two, four, and eight virtual cores with 3.75GB RAM per virtual core.
• Storage. Store data on local disk, persistent block device, or Google Cloud Storage.
• Network. Connect virtual machines into clusters with configurable firewalls.
• Tooling. Configure and control via a scriptable command line tool or Web UI.

Those tools are notable but not as mature as what Amazon is offering. Amazon offers storage, compute, databases, content delivery networks, and identity management, as well as templates to build cloud services. In addition, Amazon got an early lead and has worked to court the enterprise buyer as it evolves contracts and services and offers Windows instances as well as connections to Oracle and SAP applications.

Add it up and Google has thrown down an Amazon Web Services challenge, but the product has a ways to go to match its rival on breadth and depth.

Google shows Apple: We made ours in the U.S.A.

Google's Nexus Q has one small but important distinction that Apple can't claim.

On the underside of Google's streaming media player is the message: "Designed and Manufactured in the U.S.A."

Compare that with Apple's "Designed by Apple in California. Assembled in China."

Indeed, it is almost unheard of to see a high-tech consumer device like the Nexus Q made anywhere but Asia, as the New York Times points out.

This wasn't always the case. Apple at one time assembled Macs in California. And Steve Jobs'NeXT Computer made its computers in the Golden State.

Compaq and IBM, too, both assembled PCs in the 1990s at sprawling facilities in Houston and North Carolina, respectively. (Compaq even made its motherboards in the U.S.)

Over the last 10 years or so, that ecosystem -- component suppliers and assembly operations -- has moved off shore, almost exclusively to Asia. And Apple is now the poster child for making things in China.

But that, too, may be changing. The New York Times quotes Harold L. Sirkin, a director at Boston Consulting Group: "At 58 cents an hour, bringing manufacturing back was impossible, but at $3 to $6 an hour, where wages are today in coastal China, all of a sudden the equation changes."

The Nexus Q is made at a plant in Silicon Valley.

There is a downside. The $299 price makes it more expensive than, for example, the $99Apple TV. Google told the the New York Times that the higher price is due, in part, to the higher costs of manufacturing in the U.S.

But those costs should come down as production volumes increase.

Hey Apple, if Google can do it (and eventually bring down costs), maybe you can too.