Last week, Microsoft and Andersen announced plans to form a joint venture, named Avanade, to help implement Microsoft's Windows 2000. There are so many problems with this type of deal, it's difficult to know where to start.
On a business level, Microsoft has embarrassed the service partners it brought on stage at the Windows 2000 launch. Self-serving tactics like this are a way of life in business, and, if we're to believe the parade of government witnesses at Microsoft's antitrust trial, this type of behavior is to be expected from Microsoft.
Of course, these "victims" can't be surprised and are now probably licking their chops at the prospect of burying Andersen and Avanade.
The problem with the whole concept of a consultant organization that plans to integrate Windows 2000 is that it doesn't necessarily align with buyer need: solutions based on the best available products or products that are already in place. When Avanade comes to pitch a solution for integrating a supply chain, will the pitch include ripping out Oracle and replacing it with SQL Server because they can't get Oracle to work the way they want with Windows 2000?
Customers of Andersen will learn quite a bit about the people on their teams in the coming months. The future of Avanade entails an IPO, so expect Andersen consultants to try to jump the line to Avanade, regardless of what internal controls Andersen keeps in place to retain staff. (Andersen has already acknowledged a competitive market is requiring them to further change incentives to keep consultants from jumping to other startups.)
Avanade won't be picking up the scrubs to fill the ranks unless they're desperate. Therefore, if the Andersen team at your site suddenly thins out or gets replaced by a bunch of new characters, you just went from having the "A" team to getting the "B" squad. If the consultants at your site don't change, what does that say about the quality of the people consulting for you? It sounds like a no-win situation for Andersen customers to me.
In light of Ernst & Young selling off its IT services group to Cap Gemini to focus on tax services, it begs the question about the long-term prospects for large IT services companies. Many companies are banking on the concept that outsourced applications will obviate the need for IT staffs, which also implies outsourced IT services.
But smaller, focused consulting groups continue to gain credibility for delivering better value more quickly. Perhaps Andersen will be a victim of this decline.
Look, up in the sky, it's a ...
It comes as no surprise that Iridium satellites will share the same fate as SkyLab. When I look at the world and all those cell phones, there are places that represent obvious opportunities to provide wireless phone access. Interstate highways, metropolitan and suburban areas, and even rural town centers need support for wireless phone networks. Basically, put the network where the people are.
When I'm out in the middle of the ocean or climbing in the Himalayas, there isn't a great deal of opportunity because there just aren't a great deal of people there. In fact, the people in those areas are generally on vacation or struggling to survive on a most basic level, so "anywhere phone access" probably isn't at the top of their minds.
If I'm not mistaken, I believe someone by the name of Marconi invented a technology that works pretty well for those places in the world. And unlike Iridium, it doesn't cost a few bucks a minute to send a radio transmission.
So what are your plans for watching Avanade and Iridium satellites crash and burn? Send your thoughts to michael_caton@zd.com. Off the Cuff, an online exclusive column, appears Monday, Wednesday and Friday.
