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Wednesday, January 30, 2008

One Cut Cable = $Millions Lost

Lest we be forget that the Internet is based on wires and antennas, consider this news item (Reuters via NYTimes):

A breakdown in an international undersea cable network disrupted Internet links to Egypt, India and Gulf Arab countries on Wednesday, and Egypt said it could take several days for its services to return to normal.

It was not immediately possible to gauge the impact of the disruption on financial institutions. Egypt's telecoms ministry said 70 percent of the country's Internet network was down and India initially said it had lost over half its bandwidth.
The Internet was designed as a military research project, with the goal of creating a network that could not be taken out by destroying a single central computer. Indeed, it's admirable that data traffic could still get through via alternate routes in Egypt and India. But I sometimes think that we don't realize how vulnerable the whole thing is. We are talking about, I presume, a single, lonely cable lying on the sea floor here. How many dollars worth of business and personal data were interrupted by what could been, for all we know, a shark attacking what it thought was a fat and listless eel? Okay, that's unlikely, but the point is that it's pretty easy to disrupt the Internet by accident, and if you know where to strike, you'll virtually guaranteed of some success.


Part of the problem is that we run pretty close to our capacity. That means that cutting even a minor backbone cable (or cyber-attacking an important backbone traffic routing computer) can have an outsize effect as data tries to cram through the existing pipes on the way to its destination. Fortunately, unlike the electric grid, there won't be an overload that shuts down the data traffic routers (the equivalent of electric substations, if you like). Unfortunately, what an overloaded router does is a) become slow and/or b) randomly reject or drop your packets of information. Data that doesn't arrive exactly as you sent it or arrives in partial form is about as useful as electricity that comes on only during odd-numbered minutes of the day.

Capacity does not appear to be getting better. It's kind of like the gasoline refinery situation here in the U.S. or the worldwide oil situation for that matter: there is enough of either, but demand is so close to capacity/production that even a minor supply disruption can affect everyone worldwide. The Internet is a bit more segmented--the traffic disruption in the Middle East and India won't slow us in the U.S. from reaching our Web sites (unless perhaps if they are hosted in those affected areas). But plenty of U.S.-based businesses have important IT operations in India (or companies they rely on with Indian IT operations).

Do you have a backup plan for your company in case Digital Armageddon hits tomorrow?
(image credit: Center for Complex Network Research, University of Notre Dame)

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Thursday, April 19, 2007

In India, this one expansion means 15,000 jobs

India's largest IT services firm, Tata Consultancy Services (TCS) announced plans today to invest Rs.4 billion, or over $95 million, to develop a facility on the outskirst of Hyderabad, Andhra Pradesh, India. The facility, which is expected to be completed by 2013, will employ 15,000 people. This will take the total number of TCS employees to 89,000 in 47 countries.

TCS, whichis based in Mumbai, also expects to increase its staff in China by 5,000 over the next four years.

TCS hit a milestone this week, crossing US$4 billion in revenues for the first time. TCS's customers include IBM, Bank of China, Qantas Airlines. TCS was the first Indian software company to open an overseas office in New York.

Sources: India eNews, India PR Wire, The Financial Times, Economic Times India, The Telegraph, Business Week, Tata Consultancy Services

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Friday, April 13, 2007

What's up with Tanzania?

Fin24, a South African business news site, published an article today that sums up how the World Bank works. With all the buzz about the Wolfowitz scandal lately, it's nice to see a concise, clear explanation of the WB's inner workings, including a "Controversial Baggage" section.

The scandal aside, Wolfowitz, at a press round-table yesterday, said that India is an inspiration for Africa. At Business Facilities, we have been following U.S. manufacturing and communications companies as they expand to India due to its low cost and skilled workforce. Could developing countries in Africa be next?

For example, recently I came across an advertisement for doing business in Tanzania. Hakaya Kikwete has been president of this sub-Saharan country since 2005, and has watched the economy grow and the debt diminish. However the rate of poverty is still high.

Even so, the WB named Tanzania one of the 10 most improved countries. The Tanzania Chamber of Commerce launches their ad campaign this week.

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