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Notebook sales to increase in the second half of 2013

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May 11, 2013

On average, worldwide notebook and tablet sales are down substantially, but according to the chairman of the company manufacturing notebooks and laptops for companies such as Acer, Dell, Toshiba, HP and a few others, sales will pick up in the second half of 2013.

Compal Electronics chairman Ray Chen told an investors conference on May 9 that, although he expects global shipments of notebooks and tablets to shrink in the second quarter of this year by about 10 percent, that trend will reverse itself in a big way during the second half of 2013, according to DigiTimes.

And what's the main reasoning behind for this optimism you may ask? It's simple-- the launch of new products and the initiation of new promotions from Intel and Microsoft.

And Chen would know. Compal Electronics brought in over $5.6 billion in overall revenue during the first quarter of this year, although its net profit was a small US $470,000 or so a drop of over 37 percent from the same quarter in 2012.

And it would appear that Chen has more than enough motivation to hope that the notebook market improves. In addition to his bullish predictions for the second half of 2013, Chen also sees touchscreen notebooks taking off as well.

In the first quarter of this year, touchscreen models comprised 4 to 5 percent of his company's notebook shipments, but he expects that share to double in the second quarter and double again by the fourth quarter of the fiscal year, placing it at around 20 percent by the end of the year.

However, that prediction is going to require a lot of help from touch-enabled Microsoft Windows 8 running on touch-enabled Intel Ultrabooks, if it's to come true at all.

In other IT news

On any given day, IT managers and system admins usually have they busy work schedules pretty well figured out, and when it comes to software licensing, that's when things get more complicated. And the trend has been getting worse lately.

Businesses and big companies today shouldn't be surprised to discover they're having issues understanding their enterprise licensing agreements.

While Microsoft, Oracle, SAP and other big players publicly claim that transparency and fairness is in their licensing and pricing agreements, customers often disagree when they get to the bargaining table or open the results of a software audit.

To that end, Oracle and SAP are in a unique position as the two biggest enterprise software companies in the world. Combined, they account for more than 40 percent of the global ERP market. No other enterprise software vendors offer software lineups that are as broad and deep as those of Oracle and SAP.

And with billions of dollars invested in R&D every year, customers of these two companies have come to expect a steady stream of technological innovations that give customers real competitive advantages, such as SAP's HANA database and Oracle's Exadata database appliance.

Customers of Oracle and SAP appear to be reasonably happy with the functionality delivered by the vendors' wares. But there is a darker side to working with the software giants. Depending on which vendor you're dealing with, you may find the licensing agreements to be extremely complex, rife with vague terminology, inflexible to various changes in business structure, or subject to capricious levels of enforcement.

Take SAP for example. Its basic licensing model is quite simple. The company lays out the basics in a 26-page white paper, "Licensing SAP Software," which is available on its website. The company says the customer is able to pay for only the SAP software that they use. But the reality is usually something different. And in some cases, it can be very different.

At a higher level, SAP sells its flagship Business Suite in two ways-- packaged licences and named-user licences. It's all perpetual licensing with SAP, which offers subscriptions only for two solutions: the SMB-targeted SAP Business ByDesign suite, and CRM OnDemand.

A SAP customer will start by licensing the "enterprise foundation" package, which includes the core SAP ERP software (ERP Financials, ERP HCM, and ERP Operations), at a pre-determined price. On top of that, customers select various "enterprise extension" packages (generic business functions like payroll), industry portfolio packages, and line-of-business portfolio packages.

Each of these packages is priced based on a business metric, which could be anything from the customer's revenue, the number of employees, the number of processor cores the software runs on, or the number of invoices sent out daily. Analytics, mobile, and database products are separately priced, and have their own restrictions.

For instance, SAP HANA is priced on the amount of memory it can use. Every user that needs access to the SAP package is required to have a named user licence. SAP sells three main types of named user licences-- professional, developer, and employee. The differences in that the licences depend on the level of access required and the amount of time they're going to spend working in the SAP software.

Chris Hughes is a SAP licensing expert with Flexera Software, a software licence management tool vendor. In his position, Hughes has an in-depth understanding of the different licence types that SAP uses across its products, and helps customers to minimise their SAP licensing expenditures.

"One of the bigger challenges in SAP licensing is that the licence models are very vague and open to interpretation," Hughes says. "For instance, a professional user licence would be defined as somebody who performs operational duty on the SAP system, whereas the limited professional licence is really defined as someone with limited operational actions," he added.

That definition of 'limited' is very open to different interpretations and different customers will look on that in different ways.

"The vagueness is definitely a challenge," Hughes says. "In fact, I sometimes feel that it's done on purpose. We're starting to see a trend of SAP being more specific in their contracts but still, they have a long way to go before the vagueness goes away."

The other big issue facing SAP customers is something called indirect access. SAP defines indirect access as occurring when a user or product accesses data stored in the customer's SAP system through a third-party interface. Examples of this could be an Oracle Hyperion BI application taking data out of the customer's production SAP database, or serving data through a Microsoft Web portal.

Source: Compal Electronics.

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