The sky is falling! Trip Chowdhry, the analyst with Global Equities Research who claimed Red Hat was ‘rubbish and the entire LAMP stack is potty, too’ published some eye-opening predictions, predominantly negative, about tech business in Silicon Valley. Now Chowdhry claims that “almost every VC funded open-source company is struggling and will run out of money within the next six months.” (Probably not the most unbiased guy about open source) Matt Asay argues that organizations in general are struggling, but open-source companies are not that high on the list. (But are they high on the VC “axe” list??) He notes Alfresco, Pentaho and JasperSoft are some of the players with ‘millions in the bank and growing revenue.’ Asay also says Chowdhry has a responsibility to do real due diligence and not create myths. Take that, Chicken Little! (img from Disney-Clipart)

We’re not as far behind as we thought we were. Google presented the results of a study they conducted about how IPv6- capable “ordinary users” are at the RIPE meeting in Dubai a few weeks ago. Turns out Apple Macs drive IPv6 penetration in the US. Fifty-two percent of all IPv6 users in the U.S. own a Mac and use 6to4 (creating IPv6 addresses from an IPv4 address and tunneling packets) – making the US fifth in the list of countries using IPv6. Russia and France took first and second place with .76 and .65 percent IPv6-enabled traffic . The US is at .45 percent. Worldwide, 0.238 percent of Google users’ systems are IPv6-enabled and prefer to use IPv6 over IPv4.

Obama’s win = Google’s win? Apparently Google CEO Eric Schmidt and President-Elect Obama are very good buddies and “this terrifies Microsoft”. Now competitors are more on guard against Google’s growing empire and popularity. Although Schmidt was mentioned as a possible candidate for the country’s new national CTO position, he said he would not accept the post if asked. I guess that’s one less thing Microsoft has to worry about.

He is urging young entrepreneurs and engineers to stop making some of  the sillier software that lets Facebook users throw virtual sheep at  their friends or download virtual beer on iPhones, and instead start  making a real difference in the world.

He says it's not just the right thing to do, but also the smart thing  to do -- especially as the credit crunch spreads to Silicon Valley,  venture financing becomes scarce and start-ups have to retrench.

When this grizzled, 54-year-old tech-industry veteran talks, Silicon  Valley tends to listen, if only to argue with him.

He is urging young entrepreneurs and engineers to stop making some of  
the sillier software that lets Facebook users throw virtual sheep at  
their friends or download virtual beer on iPhones, and instead start  
making a real difference in the world.

He says it's not just the right thing to do, but also the smart thing  
to do -- especially as the credit crunch spreads to Silicon Valley,  
venture financing becomes scarce and start-ups have to retrench.

When this grizzled, 54-year-old tech-industry veteran talks, Silicon  
Valley tends to listen, if only to argue with him.

The name reveals some of its creepy appeal: Spykee = Spy Camera. I suppose the nanny you're trying to make sure isn't shaking your baby might be freaked out when it suddenly starts emitting Star Wars music, or such like. Made by Meccano under the Erector brand, its control software is Mac and Windows compatible.

I, for one, welcome our new Spykee overlords--on 15-Oct-2008 when it starts to ship generally.

Silicon Valley project finally gets underway: It's a still a pilot, small, with no promised outcome. And after all this time, a switch of partners, and new parameters, they've still mounted just 20 of 28 access points.

This chance to “get rich quick” prompted many talented young entrepreneurs and IT specialists to move to the Valley, and in turn helped establish the area as a hip young center for the most talented people in the field. 

The Beltway, (a.k.a. Washington, DC area) has always been known as a home for those wanting to enter into public service, or at least a career in grand gestures, however with the rapid growth of government-based IT needs, and the success of many IT companies in the area, it is slowly transforming into an IT hub of its own. 

[Note: Dave and Julia disagree with my perspective on the slow growth of DC as a tech hub. In their opinions, it always has been with many great IT companies founded and run out of the DC area, including AOL, UUnet, and The Motley Fool, to name a few. The area was properly positioned as the “Silicon Valley of the East” in the 90’s and was able to successfully cultivate a large and prominent IT culture. BUT it’s interesting that Silicon Valley dominates in terms of popular perception, as I believe and so do many friends I’ve discussed this with.]

But perhaps that is changing. Dave wrote an earlier post about the lack of local tech coverage in the Washington Post. Recently, however, we’re seeing more relevant articles in the paper that highlight the growing DC young IT scene. Case in point, this article about LaunchBox, a DC tech incubator that will hopefully only serve to grow and enrich the community with more talented young IT professionals and big thinkers. 

The question that remains is how the culture in this very traditional area will change with this growth. 

New life for dead Tempe network? Another firm has expressed interest in buying the pennies on the dollar assets that remain of the former Kite Networks installation in Tempe from the firm that financed the venture as long as they can negotiate a new, more favorable deal with the city for mounting and removal rights. CTC, Inc., which the East Valley Tribune reports runs networks in the Kansas City, Mo., area, thinks there's an opportunity. The article notes that reception problems were due in part to the prevalence of stucco in Tempe, common in the southwest. Stucco walls layer plaster or other materials on a wire mesh for strength that turns a house into a bit of an accidental Faraday cage, partially shielding the home from electromagnetic radiation. (Could I go so far to say that Tempe's network could be a phoenix? Ouch.)

Wake up, you darn computer: Intel's new Remote Wake motherboards won't work with Wi-Fi, it's important to note. The feature, announced today, will let an incoming VoIP call (the articles all say "phone call over the Internet") to wake a computer, as long as the call comes from a particular source. Of course, the standard SIP protocol for VoIP doesn't have the kind of security and integrity that would allow this; Intel has to overcome the problem with network address translation that renders most computer unreachable from outside the local network without a separate service like GoToMyPC or LogMeIn; and it will only work for computers connected via Ethernet to a local network, because Wi-Fi is off when a computer sleeps, while Ethernet can remain lightly active. I don't have the protocol details yet, but there's long been a Wake on LAN protocol that required support in a router, operating system, and Ethernet card; Intel may be leveraging this.

The conversation went well, I thought, until I received a call from another person in the company who proceeded to tell me how to do business in Thailand and how to determine the target market, and how to set up sales. Now mind you, I had already explained that there would be no immediate sales opportunities for a few years, realistically, and that this was a long term initiative, designed around a solid education and training program - build infrastructure first. From a strong education and training program, the market would become clear.

This is such a simple win-win-win situation, but companies do not seem to understand it. They just want to exploit every contact, event situation, for a quarterly sell. Why not take the long view as well, since it does not cost you any money?

The guy on the other end of the phone would have nothing to do with our way of thinking in Thailand. He seemed to be pushing to insure pre-sales contact immediately. Instead of supporting us, he wanted to manage us from overseas!! We asked for support to build their brand, what they seemed to offer was management by proxy!

Folks, this will not work in Thailand (or most Asia countries).

If you want to tap into the fast growing Asia market, leave behind your aggressive New York or Silicon Valley sales guns and forceful presale tactics, where you are content to find an opening, exploit it, make a sale, and report the sale on your quarterly report. You can get aggressive when you have built a sustainable infrastructure. The same is true in Japan, not only Thailand.

In Asia, do as the Asians. In Rome, do as the Romans. In Thailand, do as the Thais. In Japan, do as the Japanese.

It is easy to make money in Thailand (and other Asia countries) if you follow their way of business. Educate, teach, build a workforce, build a sustainable infrastructure on the ground, and then sell, sell, sell.

Granted, many companies do not have resources to do this overseas. In that case, enable your partners to do it and let them build the business; don’t manage them, support them.

People ask why do you blog?  In the final analysis I blog because I like to. Every once in a while though you get a comment from a reader that reminds you why it is all worth while.  Here is one I received today from a person alleging to be a Julie Peterson:

Julie Peterson commented on Safe Access wins SC Magazine Award Reader Trust Award, again!:

Dressed in a tuxedo and chewing those rubber chicken breasts at the award ceremony is your idea of fun? Aren't you the same mentally retarded idiot who said in 2007 that you hated SC awards and that anyone can buy the SC awards with a sponsorship? Why do you think people give over $10k as sponsorship for the SC awards? Who is watching the awards except other vendors? By the way you suck big time with your rubbish blogs. Didn't networld magazine give you the boot within 3 months? Think before you write Mr. mental. Well done on winning, but please, dont give the impression that you cant buy an award from SC! And don't forget to eat your medication pills tonight, otherwise from your hair it is obvious you ran away from a mental hospital.

First of all Julie, let me thank you for your kind words! You made the statement and let me answer your questions for you.

1. Is dressing in a tuxedo and chewing rubber chicken breasts my idea of fun?  Actually, I do enjoy dressing up in a tuxedo once in a while.  The food at the awards ceremony was actually pretty good, if not diet friendly, as were the cocktails.  The entertainment at the awards show was pretty good as well. Catching up with friends you had not seen for a while and networking with industry peers was pretty worthwhile too.  Maybe your idea of a good time is putting on a bowling shirt and swilling a couple of beers and pretzels before going home and undressing into your dirty ripped underwear. Hey I say to each his own.

2. I am not the idiot who in 2007 said that I hated the SC awards and that anyone can buy the SC awards with a sponsorship.  I am the idiot who said that about the InfoSec Products Guide award by the folks at Silicon Valley Communications.  In contrast I have always said nice things about the SC awards. I actually have a lot of respect for them.  Also for the record, StillSecure has never been a sponsor of the SC Magazine awards. I have seen sponsors who did not win awards as well.  So looks like you got that one wrong Julie, but it happens.

3. ???Networld??? magazine didn???t give me the boot within 3 months.  They never had the chance, as I never wrote for ???networld, network world or any other magazine. Maybe you have me confused with Mike Rothman or Mitchell Ashley, who do and did write for Network World. But let me assure you that I do try and think before I write.

4. Regarding what medication pills I take and does my hair make it obvious I ran away from a mental hospital. I don???t take any medication, maybe I should.  Better living through chemistry you know ;-)  As to my hair, what can I say.  At this stage I am happy I have any hair at all.  My wife always says when I get my haircut it looks like a Buzz Lightyear style, but no one ever mentioned a mental hospital look to it.  In any event sorry it doesn???t appeal to you.

So who is this troll Julie Peterson?  Could it be Richard Stiennon in drag?  Maybe his wife striking out?  Maybe another one of my fans?  Who knows, but these sort of comments keep me juiced about blogging and remind me of how much fun I have doing it.  Thanks again Julie!

People ask why do you blog?  In the final analysis I blog because I like to. Every once in a while though you get a comment from a reader that reminds you why it is all worth while.  Here is one I received today from a person alleging to be a Julie Peterson:

Julie Peterson commented on Safe Access wins SC Magazine Award Reader Trust Award, again!:

Dressed in a tuxedo and chewing those rubber chicken breasts at the award ceremony is your idea of fun? Aren't you the same mentally retarded idiot who said in 2007 that you hated SC awards and that anyone can buy the SC awards with a sponsorship? Why do you think people give over $10k as sponsorship for the SC awards? Who is watching the awards except other vendors? By the way you suck big time with your rubbish blogs. Didn't networld magazine give you the boot within 3 months? Think before you write Mr. mental. Well done on winning, but please, dont give the impression that you cant buy an award from SC! And don't forget to eat your medication pills tonight, otherwise from your hair it is obvious you ran away from a mental hospital.

First of all Julie, let me thank you for your kind words! You made the statement and let me answer your questions for you.

1. Is dressing in a tuxedo and chewing rubber chicken breasts my idea of fun?  Actually, I do enjoy dressing up in a tuxedo once in a while.  The food at the awards ceremony was actually pretty good, if not diet friendly, as were the cocktails.  The entertainment at the awards show was pretty good as well. Catching up with friends you had not seen for a while and networking with industry peers was pretty worthwhile too.  Maybe your idea of a good time is putting on a bowling shirt and swilling a couple of beers and pretzels before going home and undressing into your dirty ripped underwear. Hey I say to each his own.

2. I am not the idiot who in 2007 said that I hated the SC awards and that anyone can buy the SC awards with a sponsorship.  I am the idiot who said that about the InfoSec Products Guide award by the folks at Silicon Valley Communications.  In contrast I have always said nice things about the SC awards. I actually have a lot of respect for them.  Also for the record, StillSecure has never been a sponsor of the SC Magazine awards. I have seen sponsors who did not win awards as well.  So looks like you got that one wrong Julie, but it happens.

3. “Networld” magazine didn’t give me the boot within 3 months.  They never had the chance, as I never wrote for “networld, network world or any other magazine. Maybe you have me confused with Mike Rothman or Mitchell Ashley, who do and did write for Network World. But let me assure you that I do try and think before I write.

4. Regarding what medication pills I take and does my hair make it obvious I ran away from a mental hospital. I don’t take any medication, maybe I should.  Better living through chemistry you know ;-)  As to my hair, what can I say.  At this stage I am happy I have any hair at all.  My wife always says when I get my haircut it looks like a Buzz Lightyear style, but no one ever mentioned a mental hospital look to it.  In any event sorry it doesn’t appeal to you.

So who is this troll Julie Peterson?  Could it be Richard Stiennon in drag?  Maybe his wife striking out?  Maybe another one of my fans?  Who knows, but these sort of comments keep me juiced about blogging and remind me of how much fun I have doing it.  Thanks again Julie!

By now you have probably heard that Brocade is making a big push from storage networking switches into Ethernet switches by buying Foundry Networks for almost 3 billion in cash.  Actually the deal is valued at about 2.8 billion.  However, Foundry has about 800 million or so in cash and liquid assets.  So taking that into account, the deal is for about 2 billion really, according to the San Jose Mercury News. Still that is quite a number when you consider that $18.50 of the $19.25 price per share is in cash.  That works out to about 2.7 billion.  Considering Brocade only had about 700 to 800 million in cash itself, that means someone is lending them about a billion and half.  Again according the Mercury News, it is Bank of America and Morgan Stanley. This is a 41% premium over Foundry's closing price.  Pretty sweet!

The real question is what does Brocade do with this.  With all of that debt, do they have what it takes to go on and take on Cisco now?  The highways and byways of Silicon Valley are littered with companies that have tried to take Cisco out of this market.  What about the 7 dwarfs who currently compete in this market.  Companies like HP ProCurve, Extreme Networks, Nortel, Enterasys, Alcatel-Lucent and Force 10 are not small little companies. These are companies with 100's of millions, if not billions of dollars of market cap themselves.  They are not going to roll over and die here. Will this set off a round of consolidation for these players to bulk up in order to compete in this brave new world of networking? I think so. What about next gen secure switches like ConSentry, Nevis and Napera? Or some of the other smaller switch vendors like D-link?  Do they view this a a good opportunity to get bought by one of the giants or do they think they can run through the legs of these giants?  I don't know but it is going to be a high barrier of entry into this market.

Ultimately though I don't think Cisco will lose its place of dominance very easily. Brocade will be another competitor among the other switch vendors fighting over 25% of the market. But it sure will be interesting in the switch market for a while.