Redefining Identity: A wonderful documentary about software and technology in Lahore, Pakistan

I just received a message from the folks over at FiveRivers who have produced this wonderful documentary on innovation & entrepreneurship in Pakistan. It’s really worth watching, and I love the underlying message: the notion that we can redefine our perceived identity with our hard work and achievements. I can certainly sign up for that, and I’m sure so would you!

Here’s a bit more about the documentary:

“Redefining Identity takes a look at the amazing entrepreneurship and creativity that is being unleashed in Pakistan, where young technologists are coming together to lead a very real revolution that has powerful social, economic and technological implications. In doing so, these young Pakistanis are also transforming Pakistan’s perception in the minds of millions of people all around the world who use their products and appreciate their creativity. This 10 minute film is a rare glimpse into the reality of today’s Pakistan. Anyone with an interest in technology and startups in general, or Pakistan specifically, will find it a very worthwhile watch.”

There are quite a few subtleties to catch in this video… listen for that line about not going by obviously assumed western names when fielding support calls. Sound familiar Plenty of other one liners embedded in here that make this a fairly engrossing and exciting watch. If you want to discuss the documentary, you are welcome to do so here, and also at the “Redefining Identity” facebook page, here.

If you are a software entrepreneur or involved in the tech industry in Pakistan, this video would be a great asset to share with partners, potential customers and others who might not have a clear view about what tech companies in Pakistan are truly like, and the quantum of innovation now being unleashed in Pakistan. I really see this film as a resource that everyone involved with tech in Pakistan should use actively, and hope there will be many more similar efforts in future.

Without further ado, here is the courtesy YouTube - be SURE to watch this in full screen mode - it’s definitely worth it:

www.youtube.com/watch?v=xhynv21jSkI

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Participants listening to a presentation at the Gaming and Animation Conference in Karachi (Photo credit: PSEB)

Pakistani game developers are increasingly in the news. It seems that over the past couple of years, an entire sub-industry has been created out of thin air. Given the political and economic context, this is nothing short of remarkable. Prior to the new all-star lineup featuring companies such as Mindstorm Studios, Pepper.pk, TinTash, Tkxel and GenITeam there were only a handful of organizations focused on game or animation development. Systems Ltd.’s subsidiary, AniVista, was one, and then of course, a few digital media companies based in Pakistan, such as Post Amazers, that had fairly visible international success. Now it appears that gaming companies are here to stay and have most certainly grown beyond the very initial infancy stages.

Luckily, the PSEB (Pakistan Software Export Board) has put some wood behind this arrow and they’ve been trying to help these companies out in numerous ways. Recently, there was a Gaming and Animation conference held at the Indus Valley School of Art in Karachi at which the Managing Director of the PSEB, Imran Zia, spoke and expressed his interest in supporting game development companies in Pakistan. Soon after, the PSEB indicated that they would extend partial financial support to 12 Pakistani companies in their participation at the premier gaming conference, GameDevelopers Conference (GDC) in San Fransisco. This year, the event will be held between Feb 28th and March 4th at the Moscone Center and if I’m not mistaken, it’ll be the first time Pakistani companies are participating en masse. The hope is that this leads to joint development opportunities, ideas that might enrich our locally produced games and business development partnerships.

This area is particularly exciting because it allows our local software outfits to grow in a fundamentally scalable way, pursuing product development rather than service provision. We’ll be keeping an eye on how the Game development sector progresses with frequent updates. In the meanwhile, you can read more about PSEB’s support to local companies for the GDC, here.

Stay tuned for more!

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An Exciting Future! While we won't quite get all the way here in 2011, things will start falling into place.

I just have a good feeling about 2011. I think it’s going to be a great year. I’ve thought a lot about where the optimism is coming from, and I don’t think it’s all subjective. Very important things happened in 2010, such as the incredibly pivotal visit by the Chinese Premier to Pakistan, Pakistan’s establishment drawing a very clear line with respect to interests it is not willing to compromise, wonderful progress with important programs like the JF-17, the arrival of product-focused Pakistani software companies like Pepper.pk who “ruled the world” with their #1 BlackBerry application, the rapid implementation of That Coal projects under the able leadership of Dr. Samar Mubarakmand and much else.

And in addition to all these things there’s the visible progress one can see unfolding in our cities. For example, with a hundred kilometers of brand spanking new, 6-lane highways (The Ring Road) in Lahore, commuting across the city in 2010 was so much easier than in 2009. New services like Qubee, added to the competition on the broadband side and Pakistan’s cellular market continued to grow with near 100M cell phones now in use in the country. To put things in perspective, that’s more cell phones than the number of people living in the UK and Italy put together!

Also, in defence of my optimism, I have to say that I haven’t fared badly with my predictions in the past. That’s not to say I couldn’t be off for 2011, but here’s a glimpse into the past:

1. Evaluating TechLahore’s predictions for 2010

2. Evaluating TechLahore’s predictions for 2009

3. Evaluating TechLahore’s predictions for 2008

With that prelude, let’s get to it. Here is how I see 2011 unfolding:

Political Predictions

The parliament is not going anywhere. This PM may or may not last, but the Parliament is well on its way to completing its 5 years. I think it will navigate 2011 in tact. And if that happens, with less than a year to go in 2012, term completion will be well within sight and all but certain.

The Congress Government in India will continue to get less popular and Mr. Manmohan Singh’s “clean” image will become a thing of the past. Corruption is going to be a massive story for India in 2011.

Mr. Obama will see an increase in his popularity rating. It currently stands at -12 according to the Rasmussen Reports. We’ll see how he ends the year up in 2011, but my guess is he could be close to neutral territory. This improvement will come from the improvement in economic conditions in 2011, as well as a greater willingness to work with the Republicans in the House.

Security and the situation in Northwest Pakistan

2010 saw a 35% reduction in the number of terror attacks. 2011 will continue that trend. There will be a close to 25% further reduction in the number of terror attacks. The reach of these attacks will, for the most part, stay limited to the Northwest. The Pakistan Army will make moves in the NWA region, but these will not be in the form of a full-fledged onslaught at the scale of the Swat operation.

NATO will begin to significantly ease up on operations in Afghanistan. They will still be there at the end of 2011, but will no longer be looking to aggressively take on the Taliban. Most of the fights between the two parties will occur as the Taliban attack NATO convoys, posts or bases. NATO may retaliate, but will not run a strategic campaign of any significance. 2011 is the year that will see an increase in outreach to Taliban and the beginnings of negotiating at a post-NATO agreement. The biggest priority for the US will now be negotiating an exit for themselves and NATO which will allow them to claim a victory, even though the reality will be far from it.

2011 will see a reduction in the number of drone strikes in FATA, as compared to 2010.

Technology Predictions

Android will end 2011 as the dominant mobile platform. Apple will not be able to reverse the trend that began in 2010. I would predict that Android will go from its current 22.7% of the US smartphone market to close to 33%. Overall, while 30% of the current US population of cell phone users use smartphones, by the end of 2011, this 30% will grow to 45% at least. All these 2010  statistics are based on December estimates from Nielsen.

Tablets will be the major consumer device story in 2011. This shouldn’t come as a surprise. But non-Apple tablets will continue to increase their market share. Today, the iPad has 95% market share, but by the end of 2011, this will be reduced to 75%.

Mobile apps for phones and tablets will continue to attract more and more developer talent. I see 2011 ending with close to 700,000 apps available for all the major platforms. Currently, iOS and Android have about 400,000 apps between them and Blackberry probably another 12,000 or so. Windows Phone7 is so new, it hardly has any. By the end of 2011, you will likely see 400,000 iOS apps, 250,000 Android apps, 20,000 Blackberry apps and about 15,000 Phone7 apps. With tablet apps thrown in, this will get close to 700,000.

Pakistan’s software industry will see a good year. The momentum on the mobile development side will continue, and I see most of the established companies growing their teams and bringing on more talent. There are few metrics available to truly judge this, but we’ll pick a few leading illustrative cases in December 2011 and see how we fared.

Apple will launch the iPhone 5 this year, but it will be a defensive, bug fix kind of product rather than anything particularly innovative to help it leapfrog the numerous Windows Phone7 and Android devices hitting the market on a monthly basis. The biggest issue with the iPhone 4 was the antenna, and so the iPhone 5 will revolve around better antenna performance. Apple will do the usual dog and pony and claim that the iPhone 5 has the best designed antenna of any phone ever made etc. But in the end, the iPhone 5 will not succeed in stemming the tide of Android and Windows Phone7 phones. The important thing here is that 2011 will be the year of the commoditization of the Smartphone. There will be so many makes and models, with so many different OS choices that will offer basically equivalent functionality, that the market will start to make a shift towards the less expensive devices (i.e. Android).

We’ll learn a lot more about Windows 8 this year. While the central themes will be integration with the Cloud, make no mistake, this will be an honest-to-goodness PC operating system. It will showcase better visualization, add support for bigger, faster GPUs and will standardize 64-bit. We may see the first 128-bit mainstream OS among Windows 8′s several SKUs. No release in 2011 though, just more specificity on what the product will be and perhaps an alpha/CTP.

Virtualization, which has commanded the enterprise IT airwaves since 2007-8, will begin to take a back seat to other trends. As services that were once virtualized start to migrate to the cloud and outsource PaaS infrastructures, the value of virtualization in the enterprise will diminish somewhat. Obviously, the level of adoption is tremendous so it will take some time to happen, but 2011 will be the turning point and this will become evident with the decreased “cool” factor and reduced coverage. On the desktop side, inexpensive PCs, numerous new form factors like tablets with native apps and cell phones equipped with projectors etc. will begin to chip away at the desktop virtualization value proposition. I don’t think this shift will be visible enough to most to cause a major reduction in, say, VMware’s stock price (hovering around $90 right now).

Wateen and/or Warid will cease to be an independent operation in Pakistan. Their poor execution has cost them dearly. If it weren’t for the seemingly limitless capital available to them, they wouldn’t have survived as long as they have. They will likely be acquired by another major operator in the Pakistani market.

Netsol stock on the NASDAQ (NTWK) will have a good year, with at least one close above $2.25 during the year.

Financial and Economic Predictions

Pakistan’s GDP will grow by at least 4%, likely 4.3%. The current estimates of two point some are utter nonsense.

The KSE will continue to rise. I expect it to benefit from the improvement in the global economic environment and the greater clarity in the regional strategic equation. I’m projecting an at-least 15% rise, but it could be as high as 25%. If it comes close to the latter, then we may approach KSE’s all-time highs in the 16K range!

The US markets, the Dow and Nasdaq, will see an increase of about 8-10%.

Job data will be watched super closely in the US. There will be some improvement this year, but I don’t think it will be very rapid. My estimate would say a .4-.6% reduction in the unemployment rate by the end of 2011.

The housing market in the US will begin a tedious, painful and slow journey to recovery. With properties having dropped anywhere from 30-70% over the last couple of years, this year will probably see a 5% increase in average home prices.

The Pakistani Rs. will see some weakening this year. It fought off pessimistic estimates of a drop to 100/$ but in 2011 we may see a 5% or so weakening with respect to the US$.

Real estate prices will start to improve in Pakistan in 2011. More importantly, the number of deals being done will go up. I will use the index price of a 1 kanal plot in Gulberg, Lahore as an index when we revisit this in December 2011. The market price is currently at 1 crore 50 lacs.

And there we have it. I’ll revisit some of these through the year as they prove to be false or true. Stay tuned, and more importantly, have an absolutely amazing 2011! Happy New Year!

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The Universe continues to be random, but we try and extract some order from it here at TechLahore!

Ah, it’s that time of year again! And how quickly it comes. It seems like yesterday that I wrote the predictions reproduced below, but look, three hundred and sixty five days have passed already. We must continue the tradition we started in 2007 and built upon in 2008… so here we go!

I was right on most issues this past year, but wrong on a few. There are still a handful of days left in 2009 but my guess is nothing material will change, so I’ll bite the bullet and get into the annual prediction review…

Political Predictions:

1. Asif Zardari is heading down a dangerous path. He will be significantly weakened and potentially removed in 2009. The conflicts with Amin Fahim, Nawaz Sharif and now Yusuf Raza and Mumtaz Bhutto, are fundamentally unsustainable. Combined with the Benazir tragedy fading further and further into the past, time will rob him of his number 1 political ally: sympathy. Were he a sounder statesman, he would have used 2008 to build alliances; he has tried, but ineffectively. 2009 will not be good for him.Well, the “potential” removal didn’t happen, but has Zardari been weakened or what?! The authority to use strategic assets has been transferred to the PM, the run-in with parts of the establishment on the issue of the NRO left him embarrassed at best, the ISI apparently despises (and we don’t blame them!) the pretender, Hussain Haqqani, Zardari’s blue eyed boy, to the extent that visa applications are being double checked for security in Islamabad. Haqqani’s washington embassy is no longer trusted. The Long March was stopped only after Zardari back tracked and restored the suo-moto-happy CJ. And then there was the NRO disaster. One can go on and on. If Zardari resides in the Presidency it is only by the skin of his teeth. He has been weakened significantly, no question. 100%.
   
2. Despite rumours, there will be no martial law in 2009; the Army will certainly have their input, but they will abstain from direct political involvement.There were rumours. And there was no martial law. 100%.
   
3. In the US, Obama will be constrained in his ability to implement his election promises. In Iraq, he will find that he will either have to come to grips with an out-right US ‘loss’ in the sense the that government there, in 2-5 years, will not be pro-US. Or he will have to do an about turn on his election promises and find some way of prolonging US involvement. This will be hard to do, because the US cannot afford it politically and financially. Any progress claimed by the pro-surge camp, will be seen to be visibly undone – but we’ll get to that in 2010 and 2011.Also in the US, Obama will have a very hard time with Afghan policy. Troop levels are going up as we speak, but the US military will soon discover that even 70,000 soldiers in Afghanistan are probably 130,000 too few. Afghanistan will not be policeable directly by the US military and sometime in 2009 we will see the US buying off warlords selectively, claiming that everything is ok and trying to set a course for departure. Of course, underneath the surface, nothing would have changed and Afghanistan will revert to being Afghanistan.Obama campaigned essentially on an anti-war platform. He is still in Iraq and has increased his presence in Afghanistan. As I said a year ago, the US cannot afford this financially, but thanks to Bush, they are stuck. Blasts continued to rip through Iraq in 2009, including some of the biggest ones leaving hundreds dead in individual incidents. The buying off of warlords, including talks with the Taliban happened on various levels throughout 2009. I also said the US would set a course for departure from Afghanistan, and we now have a date in 2011-2012. So, I would say I was on the mark as far as this prediction goes. 100%
   
4. 2009 will not be a good year for Pakistan-India relations. While there is an understanding that two nuclear armed neighbours have to live in peace, there is also a realization in Pakistan that India is an ungracious and scheming neighbour that sees itself as a global power – which it is not. Due to these grandiose visions it has of itself, India feels it can deal with Pakistan brusquely, and in this it is deeply mistaken. The region will continue to pay the price, through 2009, of these Indian misconceptions.
   
   No surprises here. Whereas Pakistan was still keen to extend extra effort at the end of 2008, we finally got fed up of Indian intransigence and constant conspiracy and disengaged.
   

5. 

   The Naxalite Communist Insurgency has ravaged 170 districts in India

   Terrorism in India will continue to hit hard through 2009. The insurgency in Assam will not be controlled and will continue to get more serious. It already poses a threat to the Indian federation, and this threat will get more severe in 2009.

   The deadly insurgency in India spread from the state of Assam to more than half the territory of India. The map to the right, courtesy India’s own IBN, shows that the violence and rebellion have now spread to 170 Indian districts. 2009 was a disastrous year for security in India as hundreds of terrorist attacks occurred. The violence on the Afghan border has received a lot of attention in the international press, but the magnitude of the insurgency in India dwarfs the FATA situation. 100%

Financial and Economic Predictions:

1. There is a belief that the economic problems in America can be solved – to some degree – by spending gobs and gobs of money. This money is essentially being borrowed from the future and raised through excessive taxation. While in the long term, society in the US will pay the price on both counts, in 2009 at least, Obama will have to take measures to inflate the stock exchange – even if artificially. This will be done through the passage of trillions of dollars of bailout packages. Therefore, in 2009 the major US stock indices will likely see a very modest increase.Well, in spades on this… the stocks have bounced back over 15%. So you could say that while I was directionally correct, I underestimated the ‘bounce’ in the market. But do see below… 50%
   
2. Not to be confused with the increase in stock indices, the US economy on the whole will be in bad shape through 2009. Many major businesses will file bankruptcy, unemployment will continue to rise at least through the first quarter or two of 2009 and spectacular corporate failures will continue to make headlines for the foreseeable future.Most experts agree that with high unemployment, continuing corporate layoffs, jobless profitability achieved mainly through OPEX cuts, the US economy is far from healthy. There were high profile bankruptcies throughout 2009 and unemployment has been growing throughout the year. 100%.
   
3. In Pakistan, the KSE has taken a massive battering due to the incorrect policies of the SEC, KSE and the Ministry of Finance. Specificaly, the lower lock prevented investors from selling when they wanted to and that caused an avalanche when the lower lock was ultimately removed. But everyone realizes this. And 2009 will see Pakistani stocks head higher. I would guess by as much as 10%.KSE is higher by over 50%. I will give myself 50% here, because while I was directionally correct, the increase in Pakistani stocks has been far greater than I could estimate.
   
4. The trade gap in Pakistan will be reduced somewhat and the out-of-control imports that were a major issue through the second half of 2007 and most of 2008, will be arrested.This too, happened. Imports were cut even at the expense of a slower resolution to the power issues. Fiscal discipline has been fairly tight, but thankfully not at the expense of development projects such as the Ring Road, the reconstruction of Swat Valley, the signal free corridors in Karachi, various Dams and of course the Centaurus, ISE HQ and Telecom tower in Islamabad.
   
5. Food will be big on the international economic agenda and corporate farming in Pakistan will mark 2009 as the year of its birth. This is one of the biggest trends to watch in Pakistan and globally, for the foreseeable future.Things are going slow here. I will give myself zero % – there wasn’t much action this year on this front even though Mian Mansha continues to make investments in this area and several Arab states, including the UAE and Saudi Arabia have expressed serious interest and applied for Government of Pakistan permission to conduct corporate farming.
   
6. Iran will begin to supply about 1 Gigawatt of electricity to Pakistan and an additional 600-900MW will come online within the country in 2009. While this will reduce the power deficiencies to a great degree, it won’t be until 2010 that load shedding is firmly in our past.Meh… 50% on this one. The Iran electricity import did not hit 1 Gw though significant amounts are being imported to power many areas in Baluchistan. Mian Mansha’s Nishat power alone added over 250MW of capacity in 2009, Wind power plants close to 100MW came online in addition to some rental units. The Turkish ship-based power generation scheme didn’t materialize, but new capacity did approach that lower end 600MW estimate I had come up with. I expect more will happen on this front in 2010, but then more on that in another post.
   
7. The US$ will trade between Rs. 75 and 85 through 2009. While the Rs. might weaken, we believe the US $ isn’t on very firm ground either. One risk to this prediction is a potential devaluation of the Pakitani Rs. to spur exports and narrow the trade gap. We don’t think that would be a very smart move…100%. That’s exactly what happened.

IT Industry Predictions:

1. The Software Tower in Lahore will finally get wrapped up close to the end of 2009. Fingers crossed.I was wrong. This has gone into March of next year. 0%.
   
2. Netsol will remain in serious trouble through 2009 and will either face some sort of shareholder action or will become a dirt-cheap acquisition target.50%. Netsol remained in serious trouble throughout 2009, at one point their stock dropped to a paltry 25c on the NASDAQ. They’ve since recovered, but still under $1, are far from their 2008 peak of almost $3.50.
   
3. The economic downturn in the West will make it harder for Pakistani companies to expand services and we will start to see some very interesting Web 2.0 and other consumer-focused products emerging from Lahore, Islamabad and Karachi in particular. Due to the massive adoption of mobile technology in Pakistan, many of these products will cater to mobile phones/users.In spades, my friends, in spades. We have so many product based successes to celebrate this year… The recent article I did on Pepper.pk – a spinoff from a Pakistan based software services company, FiveRivers Technologies – is indicative of this trend. We’ve got Cricket Revolution from Mindstorm, with true international bestseller potential. Then we have Geniteam working on mobile apps. 2009 also saw a Pakistani product on the Top 10 list on the Apple Appstore… Jaadu VNC.
   
4. 2009 will be a good year for WiMAX in Pakistan. There are now two competing offerings and Wateen is working hard to resolve coverage issues. Pakistan will be a WiMAX success story.WiMAX has truly taken off in Pakistan. There are three providers and there is serious penetration. And the nice surprise has been the excellent EVDO mobile broadband services. See both our articles on PTCL/Wordcall’s services in this area. Beautiful! 100%.
   
5. Windows 7 will be released early – before the holiday season in the US – and it will do well. It will be the only new version of a Microsoft operating system that will have more modest hardware requirements as compared to the previous version, and this will be a key reason why it will succeed.Windows 7 is going to be a success. The reviews so far are pretty good. It already has almost 4% market share, and by any measure, it is on its way to being a blockbuster. 100%.
   
6. Android will threaten to become pretty big in 2009, but will not actually become a dominant platform for the next year or more.With the Motorola Droid riding high in Q4 2009 and Android devices ready to break through big time in 2010, I couldn’t have been more right on this one. Android doesn’t have threatening market share this year, but just wait and see.
   
7. Palm will come out with a ‘Hail Mary’ piece of technology during CES, and it will not work for them. Palm will be pretty close to an untimely death by the end of 2009.Are we ready to call the Pre a failure? I think so. It’s pretty clear there is no room beyond Android, iPhone, Windows Mobile, Nokia and RIM for a SIXTH platform. And we haven’t even counted Samsung’s new mobile OS and all sorts of proprietary solutions in use today. No sir. The Hail Mary piece of technology I predicted in 2008 turned out to be the Pre, and it is a failure.
   
8. PSEB will remain relatively ineffective through 2009; since Yusuf Husain’s departure, this has unfortunately been the case and will continue to be the case… The primary reason is that the Ministry of S&T is being fundamentally mishandled and with the government’s occupation with all sorts of ridiculous infighting, the PSEB is not getting the attention necessary to attract and retain a top-class Managing Director.I was polite about this last year, but let me just say it out loud now. Can we boot this useless bureaucrat Talib Hussain out of the PSEB already? What has he done? He is utterly unimpressive, he knows nothing about IT, he has absolutely no vision and he doesn’t belong in this department at all. Boot him out and replace him with someone who knows his bits from his bytes. Seriously. This guy is zero in technology, zero in marketing and zero in, well, pretty much everything else. Get him out and stop wasting our time. We have to develop this industry and he is not the man to do it.

So, let’s see now. Where do we stand? 20 predictions, 2 wrong and 4 at 50%. That’s 16 out of 20, or about 80%. There you have it folks. Get ready for the 2010 list!

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Lahore's hotels, including the Pearl Continental shown here, will welcome visitors to the IT and Telecom show in November

I just got back from GITEX Dubai a few days ago and still have to share my views on that show with you. I saw plenty of interesting stuff, so I do intend to do a couple of posts on that topic…

But, to tide us over in the meanwhile, here’s some good news about Lahore hosting a regional IT and Telecom show. The event will be held on the 17th and 18th of November and features executive presentations by local and international executives.

Here’s more from TradingMarkets.com:

PAKISTAN TO HOST TELECOM AND IT ASIA 2009 NEXT MONTH

LAHORE, Oct 21, 2009 (AsiaPulse via COMTEX) — To help invigorate Pakistan’s economy, the 7th mega event “Telecom & IT Asia 2009″, involving a high level expert conference and an Expo of Telecom and IT Technology, would be held at Lahore on November 17-18.

This Mega Event is being organized by the monthly `Development Times’, in collaboration with the Institute of Telecom Engineers Pakistan (INSTEP). IT and Telecom Division, Federal Ministry of IT, Pakistan Telecommunication Authority (PTA), Pakistan Software Export Board and Engineers’ Study Forum are also extending their support in organizing the event.

Pakistan’s Telecom and IT sectors contribute a big share in GDP, ranging over 30 per cent in past few years. The IT sector earns over US$1 billion per annum. [..]

A large number of business executives, professionals and intellectuals will participate and deliver presentations in the event.  [..] Local and foreign experts from the concerned sectors will give suggestions to enhance the quality of services provided by these sectors and also carving out new ways to encourage investments. A number of IT Companies, Universities and Telecom groups are exhibiting their products and services in the Expo.

[..]

To read the entire article, please visit TradingMarket.com

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The Centaurus in Islamabad... work continues, but completion won't happen in 2009

Last year, I listed out a set of predictions and just recently I evaluated how they turned out. But on to more important business: what’s 2009 going to be like for Pakistan, for the IT industry and for the world at large? There are lots of very important trends unfolding before our eyes and they can cause some pretty dramatic changes to the status-quo. You may have read recently about the Russian Prof. Panarin’s prediction concerning the dissolution of the United States, or various other hypotheses about the economic disasters that are lying in wait for us as we enter 2009… and if you haven’t, I would encourage you to take a look. I won’t say whether I agree or disasgree, but will tell you that 2009 is a phenomenally imporant year for the whole world, and it is never a bad thing to understand the forces behind the change.

And that’s not a bad topic to start with, why is 2009 more important than most other years? Here’s (partially) why:

1) The US is in dire straits, economically and politically. It faces a resurgent Russia, a Rising China and it remains tied up in multiple, expensive conflicts. People in the US realize the shaky ground their country stands on today and want to change things for the better. They wanted ‘change’ bad enough to vote an inexperienced Senator in to the White House, because they associated him with the ability to affect the greatest change. If Obama fails, the World and the US, will both pay a heavy price. Whether or not he is on the path to success will be determined in 2009.

Gen. Kayani will keep the Army out of politics, while ensuring that the Army's stance is well understood by everyone.

2) Pakistan has gone from a progressive government headed by Gen. Musharraf to a relatively ineffective civilian government. So far, there has been considerable infighting and very little action. There are some fundamental issues that must be resolved in 2009, such as energy, water, trade imbalances and the security situation on the Afghan border. If the present government, which is almost a year old now, is not seen to radically alter its behaviour and implement improvements in these key areas, the traditional ‘safety valve’ in Pakistani politics will cause a change of government.

3) The world has been hit by a simultaneous, global recession. Depending on what happens in 2009, the effects of this recession can be tremendous and long-lasting. China needs a certain level of growth to ensure political stability. The US needs growth to prevent the country from being sold off in debt, and in order to maintain the traditional stability of its society. The US must keep its people employed and prevent large numbers from feeling the economic pinch. If this is not done, there is nothing stopping the increasingly frustrated unemployed millions from exhibiting agitational behaviour on display in other less stable parts of the world. India needs growth if it is to feed its hungry millions. If it fails to do so, you will have more of what is going on in the Indian state of Assam, where a Marxist rebellion has taken firm hold and has resulted in the loss of thousands of lives and a complete breakdown of the Indian state’s authority.

4) From an IT perspective, there are plenty of key things unfolding in 2009. What happens to Apple with Jobs inevitable departure? What happens to Microsoft is Windows 7 is not a great success? Do they get a third chance? What happens to the PC industry with people buying cheaper computers? Dell, in particular, is vulnerable.

So what’s going to happen? Well, your guess is as good as mine. I’ll put my guess down first and you can tell me what yours is later.

Political Predictions:

Obama is in - will he be able to deliver change?

1. Asif Zardari is heading down a dangerous path. He will be significantly weakened and potentially removed in 2009. The conflicts with Amin Fahim, Nawaz Sharif and now Yusuf Raza and Mumtaz Bhutto, are fundamentally unsustainable. Combined with the Benazir tragedy fading further and further into the past, time will rob him of his number 1 political ally: sympathy. Were he a sounder statesman, he would have used 2008 to build alliances; he has tried, but ineffectively. 2009 will not be good for him.
2. Despite rumours, there will be no martial law in 2009; the Army will certainly have their input, but they will abstain from direct political involvement.
3. In the US, Obama will be constained in his ability to implement his election promises. In Iraq, he will find that he will either have to come to grips with an out-right US ‘loss’ in the sense the that government there, in 2-5 years, will not be pro-US. Or he will have to do an about turn on his election promises and find some way of prolonging US involvement. This will be hard to do, because the US cannot afford it politically and financially. Any progress claimed by the pro-surge camp, will be seen to be visibly undone – but we’ll get to that in 2010 and 2011.
4. Also in the US, Obama will have a very hard time with Afghan policy. Troop levels are going up as we speak, but the US military will soon discover that even 70,000 soldiers in Afghanistan are probably 130,000 too few. Afghanistan will not be policeable directly by the US military and sometime in 2009 we will see the US buying off warlords selectively, claiming that everything is ok and trying to set a course for departure. Of course, underneath the surface, nothing would have changed and Afghanistan will revert to being Afghanistan.
5. 2009 will not be a good year for Pakistan-India relations. While there is an understanding that two nuclear armed neighbours have to live in peace, there is also a realization in Pakistan that India is an ungracious and scheming neighbour that sees itself as a global power – which it is not. Due to these grandiose visions it has of itself, India feels it can deal with Pakistan brusquely, and in this it is deeply mistaken. The region will continue to pay the price, through 2009, of these Indian misconceptions.
6. Terrorism in India will continue to hit hard through 2009. The insurgency in Assam will not be controlled and will continue to get more serious. It already poses a threat to the Indian federation, and this threat will get more severe in 2009.

Financial and Economic Predictions:

Mian Mansha's MCB bank is a roaring success. Corporate Farming is where he's heading next.

1. There is a belief that the economic problems in America can be solved – to some degree – by spending gobs and gobs of money. This money is essentially being borrowed from the future and raised through excessive taxation. While in the long term, society in the US will pay the price on both counts, in 2009 at least, Obama will have to take measures to inflate the stock exchange – even if artificially. This will be done through the passage of trillions of dollars of bailout packages. Therefore, in 2009 the major US stock indices will likely see a very modest increase.
2. Not to be confused with the increase in stock indices, the US economy on the whole will be in bad shape through 2009. Many major businesses will file bankruptcy, unemployment will continue to rise at least through the first quarter or two of 2009 and spectacular corporate failures will continue to make headlines for the foreseeable future.
3. In Pakistan, the KSE has taken a massive battering due to the incorrect policies of the SEC, KSE and the Ministry of Finance. Specificaly, the lower lock prevented investors from selling when they wanted to and that caused an avalanche when the lower lock was ultimately removed. But everyone realizes this. And 2009 will see Pakistani stocks head higher. I would guess by as much as 10%.
4. The trade gap in Pakistan will be reduced somewhat and the out-of-control imports that were a major issue through the second half of 2007 and most of 2008, will be arrested.
5. Food will be big on the international economic agenda and corporate farming in Pakistan will mark 2009 as the year of its birth. This is one of the biggest trends to watch in Pakistan and globally, for the foreseeable future.
6. Iran will begin to supply about 1 Gigawatt of electricity to Pakistan and an additional 600-900MW will come online within the country in 2009. While this will reduce the power deficiencies to a great degree, it won’t be until 2010 that load shedding is firmly in our past.
7. The US$ will trade between Rs. 75 and 85 through 2009. While the Rs. might weaken, we believe the US $ isn’t on very firm ground either. One risk to this prediction is a potential devaluation of the Pakitani Rs. to spur exports and narrow the trade gap. We don’t think that would be a very smart move…

IT Industry Predictions:

1. The Software Tower in Lahore will finally get wrapped up close to the end of 2009. Fingers crossed.
2. Netsol will remain in serious trouble through 2009 and will either face some sort of shareholder action or will become a dirt-cheap acquisition target.
3. The economic downturn in the West will make it harder for Pakistani companies to expand services and we will start to see some very interesting Web 2.0 and other consumer-focused products emerging from Lahore, Islamabad and Karachi in particular. Due to the massive adoption of mobile technology in Pakistan, many of these products will cater to mobile phones/users.
4. 2009 will be a good year for WiMAX in Pakistan. There are now two competing offerings and Wateen is working hard to resolve coverage issues. Pakistan will be a WiMAX success story.
5. Windows 7 will be released early – before the holiday season in the US – and it will do well. It will be the only new version of a Microsoft operating system that will have more modest hardware requirements as compared to the previous version, and this will be a key reason why it will succeed.
6. Android will threaten to become pretty big in 2009, but will not actually become a dominant platform for the next year or more.
7. Palm will come out with a ‘Hail Mary’ piece of technology during CES, and it will not work for them. Palm will be pretty close to an untimely death by the end of 2009.
8. PSEB will remain relatively ineffective through 2009; since Yusuf Husain’s departure, this has unfortunately been the case and will continue to be the case… The primary reason is that the Ministry of S&T is being fundamentally mishandled and with the government’s occupation with all sorts of ridiculous infighting, the PSEB is not getting the attention necessary to attract and retain a top-class Managing Director.

We’ll revisit the list on Jan 1st, 2010 and see how right or wrong I was. Here’s to hoping that when I’m wrong, it’s because reality turned out to be sweeter!!

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The PSEB, when it was headed by Yusuf Hussain, had announced plans to build a software park in Chak Shehzad, on the outskirts of Islamabad. Purpose-built IT space was becoming a problem in the city because the previous two IT towers under PSEB management had been completely consumed by burgeoning tech companies. The Chak Shehzad project will be the first campus-style software park in Islamabad.

What’s very encouraging is that despite a change of command at the PSEB, with Talib Baloch taking over, the execution on this project is not skipping a beat. The News most recently reported that the LOI to contract an international consortium including companies from Canada and Finland has been issued.

The Islamabad park will initially occupy about 15 acres and will have 1.5 million square feet of rentable, built-up space. This is the first of three campus style software parks planned in Islamabad, Lahore and Karachi.

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Pakistan’s software and IT exports are now in excess of $1BN, and the size of the IT industry, which was reported to be about $2BN last year, has grown to $2.8BN. This was reported by The Daily Times in an article based on a PSEB study and an interview with Pakistan Association of Software Houses (PASHA) President, Jehanara.

Earlier this year, the PSEB (Pakistan Software Export Board) had commissioned a detailed study to calculate not only market size and export totals, but also to get a sense of how the software industry in Pakistan was performing across a variety of metrics, and what common problems were being faced by member companies. The consultants involved with the study sent out detailed questionnaires to registered software companies and spoke with many IT entrepreneurs in Pakistan. Additionally, to calculate exports records of receipts declared to be due to software exports with the State Bank of Pakistan were also used.

It is important to understand that this $1BN number represents more of a floor, or minimum, than an exact figure. There are many companies involved in software export that are not registered with the PSEB. There are several more that are not repatriating 100% of their earnings to their Pakistan HQs and others that are exporting composite products in which the software component is not separately identifiable. Exports by all of these are at least partially unaccounted for in the $1BN number.

For further background, take a look at our earlier reports on Pakistan’s IT industry size and growth.

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AutoPlus ERP Software, developed by Pakistan-based Acrologix, is being implemented by Chinese auto-manufacturer, Qingqi. This ERP software was developed under a PSEB (Pakistan Software Export Board) program that seeks to promote the use of locally developed software in a variety of different industries. As the first step, five verticals were chosen for which low-cost ERP and other automation solutions were developed. Acrologix is taking the lead in the Auto sector and hopes to win additional installs. The five initial verticals covered by the program include Automotive, Garments, Textiles, Surgical Instrument Manufacturing and Agriculture. 

Automation project starts at Chinese company

By By our correspondent
5/28/2008
KARACHI: AutoPlus software, developed under Pakistan Software Export Board (PSEB)’s industry automation programme, is being applied at Plum Qingqi Motors Ltd (PQML) in Lahore, a PSEB spokesman said in a statement.

AutoPlus is a comprehensive Enterprise Resource Planning (ERP) solution for automotive parts and accessories’ units, developed by Acrologix.

The cost-effective solution would automate the processes and procedures involved in various departments of the company through various modules; administration/security, financial accounting, human resource management, raw material (purchase), production management, finished goods’ inventory and sales management, he said.

Plum Qingqi Motors has been established with the largest investment of Chinese government in the private sector of Pakistan. It manufactures motorcycles and CNG auto rickshaws.

According to the spokesman, the use of ERP solution will benefit the company in terms of efficient employees’ management, finance management, reduction in cost & time during payroll processing, inventory handling, sales processing & production management, etc. Similar results were achieved through implementation of AutoPlus at various industrial units of the automotive sector, he further said.

He informed that the industry automation project was launched in 2004 to tackle the significant challenge of automating various industries contributing to the country’s economic growth. Under this programme, five industries including garments and hosiery, automotive parts and accessories, textile processing, surgical implements and agriculture were identified.

The Enterprise Resource Planning (ERP) solutions were developed for each of the five industries by local IT companies.

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BASIS, for those of you who don’t know (a group that included me until 5 minutes ago), is the Bangladesh Association of Software and Information Services. It’s an industry group and the Bangladeshi equivalent of our very own PASHA (Pakistan Software Houses Association) or India’s NASSCOM.

Anyway, a Bangladeshi newspaper, the New Nation, came out with a review of the BASIS website, which apparently sucks. However, the article does praise PASHA’s website to the following tune, “They have huge [sic] resources to read which need many months to finish. Videos and PODCAST [sic] will extend your knowledge on Pakistan’s software industry.” In the spirit of brotherhood, I wonder if PASHA and/or PSEB can extend BASIS with some help on their website. Keep reading for the Bangladeshi news article…

http://nation.ittefaq.com/issues/2008/05/16/news0914.htm

So now we can turn to the website of Pakistan Software Houses Association for IT and ITES, P@SHA, (www.pasha.org.pk), to know where the competence of BASIS lies. They have huge resources to read which need many months to finish. Videos and PODCAST will extend your knowledge on Pakistan’s software industry. Even our BASIS is not interested to introduce simple blogs at their website. Blog is a must for a professional website to know views and opinions of surfers. To judge the surfers opinion there is an option for poll at P@SHA’s website. You can comment on the quality of the website by clicking on ‘excellent’, ‘very good’, ‘fair’ and ‘average’. E-newsletter posted at the site by a wonderful programming skill with manoeuvring huge information. The website designers of BASIS should visit the site to learn how to make a standard website.

Another website is Pakistan Software Export Board, PSEB, (www.pseb.org.pk), whose parent is government of the country. Like us they have many bureaucratic bottlenecks, but they built a western flavoured website. Mistakenly you can think you are browsing a professional and hyperactive website of USA. The home page of the website started by the quotations of international software icons like Arthur I. Anderson, Attorney, Fish & Richardson P.C., USA CEO and Mayor Bill White, Houston, Texas, USA. They lauded the quality and services of Pakistan’s software industry. Many research and technical papers are available at the website for serving the advance learners of the software industry.

With a merit the website is presenting their software industry’s total overview, even the website talks on Visa and logistic supports for foreign investors. Website of BASIS is not artistic and rich with essential contents compare to three mentioned websites of the software think-tanks of our neighbouring countries. Its option named ‘Resource Centre’ preserves a simple write-up.

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