Month: September 2003

I enjoyed reading today’s front page story in the Wall St. Journal about Royal Bank of Scotland’s multi-brand banking strategy.

People choose a bank for reasons for rational and irrational, says Fred Goodwin, Royal Bank’s plain-spoken chief executive. “It isn’t my job to tell them they made the wrong choice,” he says.

Reminded me of some smaller versions of the same strategy among a couple of bank holding companies here in the US: Great Bay Bancorp here in the San Francisco Bay Area and Synovus in Alabama and Georgia.

American Express today issued a press release commenting on last week’s decision by the U.S. Court of Appeals affirming district court judge Barbara Jones‚ ruling in favor of the U.S. Government in its antitrust lawsuit against Visa and MasterCard.

“We believe that the September 17th ruling by the appellate court effectively ended the legal arguments on the merit of this case. Visa and MasterCard have said they plan to appeal the ruling, but we believe that represents no more than a delaying tactic. Those delays are likely to run for months, not years. Based on our assessment, Visa’s and MasterCard‚s delay tactics will run their course no later than mid-2004.

“In the meantime, we will be renewing our discussions with banks about establishing network partnership agreements in the U.S. There is a strong interest among banks to partner with us in the U.S. just as they have internationally. We expect to have the first of our U.S. bank agreements signed no later than the second half of 2004.

“As we have said earlier, we continue to consider the possibility of bringing private legal action against the card associations. The September 17th court ruling reaffirms the viability of this course of action.”

CFO Magazine profiles Dell Computer and its good enough technologies. What’s relentless about Dell and others like Wal-Mart and Amazon.com are their constant focus on cost and associated price reduction.

According to Dell CFO Jim Schneider:

“I don’t think there is ever a limit to reducing costs. If we can take out even a few cents per unit by tweaking our manufacturing processes and supply chain, the sheer magnitude of units we sell adds up to a billion dollars of savings pretty quickly. Our attention to controlling operating expenses remains relentless.”

On the other hand, unlike my CIO friends who seem to buy almost everything from Dell, I’ve never bought anything from Dell. Nothing, nada. My Micron desktop retired a few moons ago, not to be replaced. My laptops are exclusively from Sony and Apple — I appreciate the design excellence these two bring (well, sorta, in the case of Sony!) to their products. But I also benefit from and appreciate that, behind the scenes, Dell’s relentless focus on low cost and price is driving Sony and Apple to do the same!

On this day last year, I was heading south to Pacific Grove.

Life doesn’t get much better than this!

I’ve just got too much work to do today to be quite so footloose and fancy free again this year — but that’s what memories are for!

Meanwhile, earlier this week, a friend circulated an email copy of Jay Slupesky’s great humor piece: Bush Lays Off Congress.

Citing the growing cost of running the Federal government and the need to cut costs in order to reduce the budget deficit, President Bush announced today that he was laying off all 535 members of Congress and transferring lawmaking operations to a legislative support center in Bangalore, India.

Phil Greenspun shares some data based upon the experiences of student’s in MIT’s 6.171, Software Engineering for Internet Applications.

A project done in Java will cost 5 times as much, take twice as long, and be harder to maintain than a project done in a scripting language such as PHP or Perl.

This dovetailed with another article titled “Where are the Components?” that I was reading this morning in the latest issues of the Java Developer’s Journal (which seems to have a number of Java laments in this issue!).

At some point we have to stop falling in love with Java and start doing something with it. The capability is there. We just have to decide to imbue it with power. It’s time we started writing reusable components and distributing them. Otherwise, we as a community of developers end up squandering the power of the tools we have. Let’s get to it.

There’s some fascinating news out this morning about former Citibank CEO John Reed being named interim chief executive chairman of the New York Stock Exchange.

At a press conference Sunday morning, Reed was introduced by Laurence Fink, head of a search committee named by the board on Friday. Reed was not at the meeting, but in a conference call he said he was not going to be a permanent candidate for the position.

Fascinating that Reed would be willing to step into this role — even on an interim basis. The salary he’s taking for the position: $1. Maybe, just maybe, Reed — known, among other things, for his skills in applying I/T to business problems — will be able to make some real progress toward changing the specialist system that is currently the heart and soul of the NYSE. Vanguard Group founder

John Bogle had an excellent op-ed piece on this subject in Friday’s Wall St. Journal (subscription required).

While the NYSE bills itself as “a private company with a public purpose,” there is no doubt that its chairman’s most important role is to protect the interests of its members. And no interest is more important than the protection of the trading profits derived by the NYSE’s floor-based specialists. Thanks in large part to Mr. Grasso’s efforts, the NYSE has, until recently, enjoyed a remarkable level of prestige, providing the cover necessary to protect its inherently unfair and inefficient trading system.

Matthew Horan writes about fee changes being made in the Australian market by bank card issuers.

An investigation has revealed the major banks have raised fees on virtually every card in the year since the Reserve Bank announced alterations to the interchange fees.

The changes to the interchange structure mean retailers and other merchants can recover the cost of accepting credit cards ˆ often around one per cent of the value of the transaction.

The savings are supposed to be passed on to consumers ˆ but the banks have responded by slugging card users with higher fees, according to a survey conducted for The Sunday Telegraph by leading financial industry monitor infochoice.com.au.

MasterCard and Visa lost their appeal of the changes to interchange rates and other credit card-related provisions made last year by the Reserve Bank of Australia. An appeal is expected.

The U.S. Court of Appeals for the Second Circuit today upheld an earlier district court decision in a case brought in 1998 by the U.S. Department of Justice.

“The defendants have failed to show that the anti-competitive effects of their exclusionary rules are outweighed by pro-competitive benefits,” Judge Pierre Leval wrote in the 23-page decision on behalf of a three-judge panel.

A PDF file of the Appeals Court decision is available online. Looks like the next stop for this case is the US Supreme Court.