The Tharoor-Twitter bug seems to have firmly bitten India. I don't mean it in a negative way. The (debatable) negative publicity for Tharoor has done huge service to popularize twitter in India amongst geeks/non-geeks. Corporate honchos, Bollywood celebrities (including fake ones) along with everyone else (OK..I don't mean every one of the one billion Indians, I just meant everyone...including the 'Cattle Class' including yours truly), now seems to have a twitter account or is at least making an effort to know what this is all about.
Things haven't turned out too badly for Tharoor himself. I mean how many people knew him or cared about the fact that he once came close to getting the top UN job before Twitter happened. Seems like the urban youth in India feel deeply connected to Tharoor, like no one else. His twitter account currently has over 350 thousand followers (and counting). That's HUGE!!
Admitted that, Ashton Kutcher (the famousque Hollywood celeb) has over 3 Million followers (He beat CNN- the news network in a fiercely fought race to be the first with One Million followers on Twitter), remember this is India we are talking about, and even though we have the largest number of young people only a small fraction use the Internet.
They say imitation is the best form of flattery. Tharoor even had an impersonator at http://twitter.com/ShashiTharoorMP . That and the fact that the impersonator's account has been suspended by Twitter (within hours of someone noticing it and compaining about it) speaks volumes about his online influence. Way to go ST.
Friday, October 23, 2009
Wednesday, October 21, 2009
Mobile Blogging
Whoa! this is my first blog post from my E71 handset. Not every thing works, but its not too shabby! Meanwhile, KS decided to come out and issue a clarification on the issue of cutoffs for IIT-JEE saying revising it was the sole perogative of the IITs themselves. Kudos to the minister for not dragging his feet orver this.
Monday, October 19, 2009
Cutoffs for IIT-JEE to be raised?
IIT JEE cutoffs could be raised. Minister for HRD, Kapil Sibal announced yesterday that, he would like to see 80 -85% marks in Class 12 board exams as minimum cutoffs for eligibility to appear in IIT-JEE. The reason given for this is to stem the huge (and ever increasing) importance of tuition centers, that have become a necessary evil in the process of gaining admission to the prestigious engineering institutions. While this is desirable, I am not sure if the suggested move would have the intended impact. On the flip side, it is very likely that the following effect would be dominant.
This would lead to increase in stress levels that students have to bear as there would be two hurdles that they have to cross, instead of one. This is certainly not desirable. The minister's earlier decisions on making class 10 exams optional and moving to a grading system, aimed at reducing the stress that students have to face.
There are other problems. If the cutoffs are imposed, the system would have to find a way to normalize cut off scores across multiple boards. (though the Minister in the past has indicated a need to move to a single board). Then, there are other questions like ensuring uniform standard of marking scores, especially in subjective questions, what would be the cutoffs for the reserved categories etc adding to the complexity. We need to simplify not overly complicate the system.
Overall, however, the direction is good. The positive intent for reforms is visible. This is a huge positive for the education sector in India. This does not mean that India is ready for 'For-profit' education yet, which seems to be the only way to transform education in the country. But, we hope that steady pace of reforms would continue. This would ensure the human capital is available to fuel India's continuous growth and prosperity.
This would lead to increase in stress levels that students have to bear as there would be two hurdles that they have to cross, instead of one. This is certainly not desirable. The minister's earlier decisions on making class 10 exams optional and moving to a grading system, aimed at reducing the stress that students have to face.
There are other problems. If the cutoffs are imposed, the system would have to find a way to normalize cut off scores across multiple boards. (though the Minister in the past has indicated a need to move to a single board). Then, there are other questions like ensuring uniform standard of marking scores, especially in subjective questions, what would be the cutoffs for the reserved categories etc adding to the complexity. We need to simplify not overly complicate the system.
Overall, however, the direction is good. The positive intent for reforms is visible. This is a huge positive for the education sector in India. This does not mean that India is ready for 'For-profit' education yet, which seems to be the only way to transform education in the country. But, we hope that steady pace of reforms would continue. This would ensure the human capital is available to fuel India's continuous growth and prosperity.
Thursday, October 15, 2009
IPL spoiling team India?
There is a debate happening on whether the Indian Premier Leargue (IPL) money is ruining the Indian cricket team. The thought is absurd. The fact that the Indian team did not do well in the Champions Trophy does not mean that IPL is ruining team India or for that matter to even reach a conclusion that the Indian team is ruined.
After all, the Indian team was only recently (albeit for a brief period) ranked the the number one team in the world. I do not remember a time when Indian team was ranked at number one (Pre IPL) so one could argue that the actual case should be made in reverse. Although coincidence dows not imply correlation.
What do you think?
After all, the Indian team was only recently (albeit for a brief period) ranked the the number one team in the world. I do not remember a time when Indian team was ranked at number one (Pre IPL) so one could argue that the actual case should be made in reverse. Although coincidence dows not imply correlation.
What do you think?
Friday, October 09, 2009
The trouble with regulating bonuses
President Obama called Wall Street’s outsize pay packages “shameful,” especially for companies in need of federal bailouts. Such pay, he said, is “exactly the kind of disregard for the costs and consequences of their actions that brought about this crisis — a culture of narrow self-interest and short-term gain at the expense of everything else.”
We have seen harsh calls around the world, even in countries such as India.
Rather than restricting pay and bonuses which is against the spirit of free markets and creates distortions, it is much more desirable to tie bonuses to long term performance. But it has side effects too.
The ‘Collosseum’ really for this debate has been the Wall Street, where the ‘Gladiators’ aka Investment banks have been slugging it out. Now, for ages these I Banks have reared these big bullies, the smartest people from B Schools, who demand to get paid a cut of the money earned by them. But this instant ‘Nirvana’ also led to the problem of Agency Costs, given the fact that there is huge churn, to and fro in these banks. You could make investment decisions based on the money earned in the same year, get paid a cut of the profits and not worry if the same investment led to an even bigger loss the following year, as you had already encashed and left the organization for greener pastures or even if you stayed put there is no negative bonus. Having deferred bonuses obviously would help to solve this problem.
However, I guess the non desirable side effect is visible too. For example how would you make sure that you get paid in case you are asked to leave next year or even if you decide to jump ship to another job? Would the unpaid bonus unfairly hold you back?
There are solutions like keeping the deferred bonus amount in escrow, but they increase administrative costs and complexity. I don't think anyone really understands what the fallout of such a plan would be. Another CDO, CMO in the making perhaps
We should perhaps have rating agencies to rate such plans :)
We have seen harsh calls around the world, even in countries such as India.
Rather than restricting pay and bonuses which is against the spirit of free markets and creates distortions, it is much more desirable to tie bonuses to long term performance. But it has side effects too.
The ‘Collosseum’ really for this debate has been the Wall Street, where the ‘Gladiators’ aka Investment banks have been slugging it out. Now, for ages these I Banks have reared these big bullies, the smartest people from B Schools, who demand to get paid a cut of the money earned by them. But this instant ‘Nirvana’ also led to the problem of Agency Costs, given the fact that there is huge churn, to and fro in these banks. You could make investment decisions based on the money earned in the same year, get paid a cut of the profits and not worry if the same investment led to an even bigger loss the following year, as you had already encashed and left the organization for greener pastures or even if you stayed put there is no negative bonus. Having deferred bonuses obviously would help to solve this problem.
However, I guess the non desirable side effect is visible too. For example how would you make sure that you get paid in case you are asked to leave next year or even if you decide to jump ship to another job? Would the unpaid bonus unfairly hold you back?
There are solutions like keeping the deferred bonus amount in escrow, but they increase administrative costs and complexity. I don't think anyone really understands what the fallout of such a plan would be. Another CDO, CMO in the making perhaps
We should perhaps have rating agencies to rate such plans :)
Saturday, October 03, 2009
Bharti MTN Deal Analysis
The Bharti MTN deal has fallen through. While there was a lot of analysis and news reporting (often breaking) on why the deal broke down, there has been a clear lack of analysis in the media on the merits of the deal, other than the fact that this would have be India's largest M&A transaction.
Intuitively, it seems strange that you would want to acquire the largest player in the territory. Clearly, Bharti did not have the appetite to do an all cash deal. Now the largest player can only grow so much on the already large scale that it has, so how would Bharti have added value. It would, in my opinion have been much better to acquire a smaller player with licences to operate in large number of regions and build on top of it. That the market rewarded the Bharti stock with a nice gap up opening on stock closure seems to suggest that this perception was right. I guess no one would know now as to what would have been the outcome if the deal had gone through.
One fear I have is that Bharti can see growth slowing down in India (due to high base, increased competition) and therefore it wanted to use its high valued currency (read stock) to purchase assets that were relatively trading at fair (if not cheap) value. This is the only reason I can think of as to why Bharti would want to acquire / merge with MTN. There don't seem to be any cost synergies (Its not as if you could share infrastructure, towers!! across continents)
It would'nt have given Bharti greater bargaining power with vendors. You know it is not a small player anyways. Perhaps in the future, media (at least business media) can actually do some financial analysis and ask relevant questions rather than just giving in to the hype.
Intuitively, it seems strange that you would want to acquire the largest player in the territory. Clearly, Bharti did not have the appetite to do an all cash deal. Now the largest player can only grow so much on the already large scale that it has, so how would Bharti have added value. It would, in my opinion have been much better to acquire a smaller player with licences to operate in large number of regions and build on top of it. That the market rewarded the Bharti stock with a nice gap up opening on stock closure seems to suggest that this perception was right. I guess no one would know now as to what would have been the outcome if the deal had gone through.
One fear I have is that Bharti can see growth slowing down in India (due to high base, increased competition) and therefore it wanted to use its high valued currency (read stock) to purchase assets that were relatively trading at fair (if not cheap) value. This is the only reason I can think of as to why Bharti would want to acquire / merge with MTN. There don't seem to be any cost synergies (Its not as if you could share infrastructure, towers!! across continents)
It would'nt have given Bharti greater bargaining power with vendors. You know it is not a small player anyways. Perhaps in the future, media (at least business media) can actually do some financial analysis and ask relevant questions rather than just giving in to the hype.
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