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ESPRIT funding — IBM marketing — data protection — transborder data flow
The giant flexes its muscles IBM’s new aggressive stance, taken up since the end of the antitrust dispute, is visible in several quarters, according to recent market reports. While IBM continues to dominate the high end of the market, it is making great inroads into areas previously regarded as the domain of plug compatible manufacturers (PCMs), and is developing more amicable relations with third party suppliers. IBM’s new tactics include increased effort in product development, moves into new markets, more flexible pricing policies and greater cooperation with secondary suppliers and addedvalue houses, says The IBM Market in Europe, a report from Frost & Sullivan. For example, the launch of the Personal Computer in Europe is expected to yield a total of $330M in hardware sales this year, inclusive of sales make by PCMs. Within a year, Frost & Sullivan expects IBM to have almost a quarter of the European market for personal computers over $2 500. The corporation is also expected to make further inroads into the slowgrowing medium systems market, where only Nixdorf will be able to hold out against IBM. Also predicted is a 5% increase in
share of the 327X-type VDU market by 1987, taking IBM’s total share to 75%, and an increase in its current low share of the distributed processing market. IBM will also ship $17B worth of magnetic storage subsystems based on new technology over the next five years. A Disk/Trend report on hard disc systems puts worldwide shipments of high capacity 3380 disc drives from IBM at 48 000 spindles for 1983. This is hitting PCMs hard enough, but the imminent announcement of a double density version of the 3380 will present them with even greater problems. One area where Frost & Sullivan believe PCMs could still be successful is in the applications terminals market, e.g. financial terminals and pointof-sale equipment. NCR, Nixdorf, Olivetti and Philips are expected to do well in these markets, with IBM competitors accounting for half of the $3.6B IBM environment sales in the 1983-1987 period. While Frost & Sullivan estimate the IBM large system market will grow rapidly to $5.3B by 1985, encouraged by the launch of the 3083 and its competitors, IDC puts IBM’s share of the world mainframe markets at 71%. In its report IBM, The Giant Awakens, IDC puts IBM’s new attitude down to the requirement for a change in marketing tactics for the IBM PC. The corporation is now more open to third parties being involved in its sales as a whole. As a first step, IBM is publishing its Document Content and Document Interchange Architecture specifications before they are available on many IBM products. According to the IDC report, if the IBM 3270 protocol, Systems Network Architecture (SNA) and DCAiDIA become industry standards, IBM will be in a stronger position for the upcoming battle with AT&T and others for control of the forthcoming
I
massive digital networks. So IBM will allow third parties to build into its networks in order to spread the use of SNA. IBM is also moving aggressively into the communications market, says IDC. ‘Satellite Business Systems, the IBM Information Network, and its 17% stake in Rolm are just the first steps in the process’, says the report. In Europe, where AT&T has a relatively low profile, IBM will be in a good position to control the LAN market. IBM’s knowledge of the European telecoms market and its interest in every commercially viable LAN technology will help to strengthen its position.
L
data processing
monitor
ControlData consolidatesits bankinginterests As a result of its takeover of Arbat, the banking systems house, in March Minneapolis-based Control 1983, Data has now merged Arbat with its own banking arm, Business Information Services (BIS), to form Financial Information Services (FIS) outside the USA. Within the USA, the companies will remain separate but will work together. While BIS has traditionally sold software services for international banking, Arbat has sold hardware and software nroducts for the banking
~0126 no 1
januaryifebruary
1984
market, based on the DEC, VAX and PDP-11 minicomputers. Arbat was founded in 1972 as a single source supplier to international banks, and has been an OEM for DEC. BIS has been a division of Control Data since 1973, specializing in management decision support systems. It has IBM mainframes in Cleveland, OH, USA and in Brussels, Belgium, with a worldwide network. FIS plans to introduce products based on an integration of the offerings from both compqnies. First announced is a
Global Risk Control system, based on Arbat’s established Series 700, and therefore running on VAX and PDP11 machines, and linked to the BIS network. It allows international banks to view their lending and compare positions against limits on a worldwide basis. Immediate targets for Financial Information Services are France, Germany, Switzerland, Austria, Japan and Benelux. Turnover for both Arbat and BIS is expected to be about $30M outside the USA.
3
Fund for worldwide telecoms finance A fund to finance telecommunications in the developing countries has been recommended by the Commonwealth Telecommunications Conference, held in Kent, UK. The conference, attended by ministers and senior officials from over 20 commonwealth countries, called upon the World Bank and economic aid organizations to ensure that higher priority is given to telecommunications development. Neglect of telecommunications wouid hamper other economic and social developments asserted the conference delegates. The fund would exploit the profits generated by telecoms and would be a ‘revolving’ one, providing loans to be repaid out of future profits of a new teleco~unications system. The conference communique states: ‘The fund would be used to the mutual advantage of recipients and donors with the object of securing universal access to at least basic telecommunications services as rapidly as possible.’
Dataprotectionlegislationto be enactedin the UK Britain will soon follow the ScandinaBelgium and the vian countries, Netherlands, by introducing data protection legislation. The original UK data protection Bill was dropped when the general election was called in June 1983. A second Bill is now on its way through the House of Commons and is expected to become law later this year. Despite a fairly speedy passage through Parliament, the Bill has had its critics. Most recently, the UK Institute of Information Scientists (IIS) argued that, if enacted in its present form, the Bill would set back the development of information technology in the UK. IIS believes that many data agencies will revert to manual records to evade the require-
4
ments of the Bill. To avoid this situation, IIS recommends that the Bill should be extended to cover all forms of personal data, whether in machine-readable form, or not. A different criticism has been voiced by the British Computer Society. Mr Gerry Fisher, a past-president of BCS, expressed a fear at a meeting of the Parliamentary Information Technology Committee, that the clauses in the Bill relating to national security would extend the responsibility for systems exempt from the terms of the Bill to too many different ministers. This would make it difficult to guarantee security. Despite these criticisms it is likely that the Bill will become law some time this year. This being the case, it
is important for DP managers and data bureaux to appreciate the implications of data protection legislation. For a full discussion of the effects of DP legislation see the article by Ken Wong on page 34.
data processing
monitor Internationalcooperationessential for transborderdataflowregulation Transborder data flow concerns can only be resolved through international governmental agreement. The absence of this agreement means that governments move unilaterally, encouraging information protectionism which could seriously threaten the prospect of economic recovery. This was the view expressed by J C Grant, vice president of strategic planning at the Royal Bank of Canada, at an OECD symposium on Transborder Data Flows held in London at the beginning of December. In Western Europe., it is estimated
~0126 no 1
januaryifebruary
1984
that by 1987 there will be 800 million transactions between data communication users, of which 15% will be international. Yet no cohesive international policy exists to regulate and facilitate such communication, although the Royal Bank of Canada is keen to encourage open-ended bilateral arrangements between Canada and the USA as a step towards multilateral consensus. Privacy rights, the conflict of laws, national security and access to data were issues discussed at the symposium which aimed to recommend
areas for international cooperation. Another Canadian speaker, W H Montgomery, director general at the Canadian Department of Communication, stressed that the right of access to data is the major issue and that many countries must recognize the difficulty of reconciling national data laws with international cooperation on the flow of data. Multinational corporations, in particular, are in a powerful position, said Montgomery, but must resist the temptation to avoid compliance with data laws by relocation.
5
share of the 327X-type VDU market by 1987, taking IBM’s total share to 75%, and an increase in its current low share of the distributed processing market. IBM will also ship $17B worth of magnetic storage subsystems based on new technology over the next five years. A Disk/Trend report on hard disc systems puts worldwide shipments of high capacity 3380 disc drives from IBM at 48 000 spindles for 1983. This is hitting PCMs hard enough, but the imminent announcement of a double density version of the 3380 will present them with even greater problems. One area where Frost & Sullivan believe PCMs could still be successful is in the applications terminals market, e.g. financial terminals and pointof-sale equipment. NCR, Nixdorf, Olivetti and Philips are expected to do well in these markets, with IBM competitors accounting for half of the $3.6B IBM environment sales in the 1983-1987 period. While Frost & Sullivan estimate the IBM large system market will grow rapidly to $5.3B by 1985, encouraged by the launch of the 3083 and its competitors, IDC puts IBM’s share of the world mainframe markets at 71%. In its report IBM, The Giant Awakens, IDC puts IBM’s new attitude down to the requirement for a change in marketing tactics for the IBM PC. The corporation is now more open to third parties being involved in its sales as a whole. As a first step, IBM is publishing its Document Content and Document Interchange Architecture specifications before they are available on many IBM products. According to the IDC report, if the IBM 3270 protocol, Systems Network Architecture (SNA) and DCAiDIA become industry standards, IBM will be in a stronger position for the upcoming battle with AT&T and others for control of the forthcoming
I
massive digital networks. So IBM will allow third parties to build into its networks in order to spread the use of SNA. IBM is also moving aggressively into the communications market, says IDC. ‘Satellite Business Systems, the IBM Information Network, and its 17% stake in Rolm are just the first steps in the process’, says the report. In Europe, where AT&T has a relatively low profile, IBM will be in a good position to control the LAN market. IBM’s knowledge of the European telecoms market and its interest in every commercially viable LAN technology will help to strengthen its position.
L
data processing
monitor
ControlData consolidatesits bankinginterests As a result of its takeover of Arbat, the banking systems house, in March Minneapolis-based Control 1983, Data has now merged Arbat with its own banking arm, Business Information Services (BIS), to form Financial Information Services (FIS) outside the USA. Within the USA, the companies will remain separate but will work together. While BIS has traditionally sold software services for international banking, Arbat has sold hardware and software nroducts for the banking
~0126 no 1
januaryifebruary
1984
market, based on the DEC, VAX and PDP-11 minicomputers. Arbat was founded in 1972 as a single source supplier to international banks, and has been an OEM for DEC. BIS has been a division of Control Data since 1973, specializing in management decision support systems. It has IBM mainframes in Cleveland, OH, USA and in Brussels, Belgium, with a worldwide network. FIS plans to introduce products based on an integration of the offerings from both compqnies. First announced is a
Global Risk Control system, based on Arbat’s established Series 700, and therefore running on VAX and PDP11 machines, and linked to the BIS network. It allows international banks to view their lending and compare positions against limits on a worldwide basis. Immediate targets for Financial Information Services are France, Germany, Switzerland, Austria, Japan and Benelux. Turnover for both Arbat and BIS is expected to be about $30M outside the USA.
3
Fund for worldwide telecoms finance A fund to finance telecommunications in the developing countries has been recommended by the Commonwealth Telecommunications Conference, held in Kent, UK. The conference, attended by ministers and senior officials from over 20 commonwealth countries, called upon the World Bank and economic aid organizations to ensure that higher priority is given to telecommunications development. Neglect of telecommunications wouid hamper other economic and social developments asserted the conference delegates. The fund would exploit the profits generated by telecoms and would be a ‘revolving’ one, providing loans to be repaid out of future profits of a new teleco~unications system. The conference communique states: ‘The fund would be used to the mutual advantage of recipients and donors with the object of securing universal access to at least basic telecommunications services as rapidly as possible.’
Dataprotectionlegislationto be enactedin the UK Britain will soon follow the ScandinaBelgium and the vian countries, Netherlands, by introducing data protection legislation. The original UK data protection Bill was dropped when the general election was called in June 1983. A second Bill is now on its way through the House of Commons and is expected to become law later this year. Despite a fairly speedy passage through Parliament, the Bill has had its critics. Most recently, the UK Institute of Information Scientists (IIS) argued that, if enacted in its present form, the Bill would set back the development of information technology in the UK. IIS believes that many data agencies will revert to manual records to evade the require-
4
ments of the Bill. To avoid this situation, IIS recommends that the Bill should be extended to cover all forms of personal data, whether in machine-readable form, or not. A different criticism has been voiced by the British Computer Society. Mr Gerry Fisher, a past-president of BCS, expressed a fear at a meeting of the Parliamentary Information Technology Committee, that the clauses in the Bill relating to national security would extend the responsibility for systems exempt from the terms of the Bill to too many different ministers. This would make it difficult to guarantee security. Despite these criticisms it is likely that the Bill will become law some time this year. This being the case, it
is important for DP managers and data bureaux to appreciate the implications of data protection legislation. For a full discussion of the effects of DP legislation see the article by Ken Wong on page 34.
data processing
monitor Internationalcooperationessential for transborderdataflowregulation Transborder data flow concerns can only be resolved through international governmental agreement. The absence of this agreement means that governments move unilaterally, encouraging information protectionism which could seriously threaten the prospect of economic recovery. This was the view expressed by J C Grant, vice president of strategic planning at the Royal Bank of Canada, at an OECD symposium on Transborder Data Flows held in London at the beginning of December. In Western Europe., it is estimated
~0126 no 1
januaryifebruary
1984
that by 1987 there will be 800 million transactions between data communication users, of which 15% will be international. Yet no cohesive international policy exists to regulate and facilitate such communication, although the Royal Bank of Canada is keen to encourage open-ended bilateral arrangements between Canada and the USA as a step towards multilateral consensus. Privacy rights, the conflict of laws, national security and access to data were issues discussed at the symposium which aimed to recommend
areas for international cooperation. Another Canadian speaker, W H Montgomery, director general at the Canadian Department of Communication, stressed that the right of access to data is the major issue and that many countries must recognize the difficulty of reconciling national data laws with international cooperation on the flow of data. Multinational corporations, in particular, are in a powerful position, said Montgomery, but must resist the temptation to avoid compliance with data laws by relocation.
5