2011 exposed big holes in supply chain

Two natural disasters demonstrated how vulnerable the computer industry is to the slings and arrows of outrageous fortune. Earlier in the year, the tsunami/earthquake in Japan disrupted multiple manufacturers, some of which are still trying to recover their operations.  And floods in Thailand created a massive shortfall in hard drive production, the effects of which are still rippling through the PC supply chain.

In an age when chips are in everything, from washing machines to cars to traffic lights, the earthquake in Japan had such a disruptive effect because it takes a whole series of processes and companies to build a single, complete chip.   

What else happened in 2011? If truth be told, it was a very dull year in the tech business generally.

Except that at CES, AMD CEO Dirk Meyer did a stand up comedy act and then only a few days later he was disappeared from the board.  It took ages to replace him as CEO – eventually the board of AMD found one Rory Read to plug the gap. Lots of layoffs ensued. Shareholders like layoffs.

Dull 2011. Although much lightened by the strange case of Hewlett Packard and former SAPman Leo Apotheker.  After making a series of astonishing decisions, including one to dump its PC division, the board decided that enough was enough, and Mr Apotheker exited stage left. His position was eventually filled by Meg Whitman, but it was too late to undo the damage – the PC business showed a profit drop. Its corporate customers got the heebie jeebies and probably started talking to Dell just as soon as Apotheker said he was going to dispose of the unit. Apotheker bought Autonomy.

The Intel Itanium continued to fox the brains of the industry.  Oracle said that the chip was a dead duck while HP insisted that even if it wasn’t the best thing since sliced bread, it was still a goer.  We went to the Intel Developer Forum in September, we can’t remember any of the senior executives mentioning the Itanic at all. It is the chip that dare not speak its name.

We’ve all been used to the famous chip patent wars between Intel and AMD over the decades, but 2011 became the year when phone patent wars erupted between Apple, HTC, Samsung and, well, practically the whole world+dog.  Apple is ably assisted by its chief lawyer, Thomas Dunlap. Dunlap used to work for Intel in the same role and brought with him a heap of experience in suing companies, individuals and anyone who dared to use the letters i+n+t+e+l in any way or manner – apart from Mintel, that is.  Intel does seem to be a bit less pugnacious on the litigation front since he’s been gone. Steve Jobs died.

Nokia. Well. What can we say.

Talking of Intel, plucky little British company ARM continued to frighten the pants off the chip giant. Despite a load of bluster at this year’s Computex that it wasn’t afraid of ARM in the slightest, there’s no doubt Intel is more than a bit rattled by Tudor Brown’s little sabre.  It continued to make design wins and, perhaps rather ominously for Intel, companies started to play with using ARM based chips in their server racks.

And then there’s Google and there’s Facebook and there’s Twitter.  Google continued its bid to oust Microsoft as the Behemoth to end all Behemoths and faced increasing criticism, litigation, and investigation by different countries scattered across the globe.  Tweet me no tweets – Twitter continued to grow while all about it people continued to be puzzled how the outfit could really make some money.  Facebook, the prime social notworking site in the known cosmos, irritates but just won’t go away.  Ooh, La Honda. Google bought Motorola.

Storage was given a makeover for another year, put in a pretty dress and bandied about as the revolutionary cloud computing. It’s not going to go away, not now, not ever, we are told by the peddlers of the products – but companies are increasingly wary about trusting all of their data with computing giants housed in the US, where the cloud is open for tinkering from spooks.

Workers in the world’s factory, China, began to realise they didn’t need to put up with a pittance and absurd, damaging hours on the assembly lines. Of course, the Party is trying to quash the strikes but hasn’t been very successful so far. As wages slowly increase, smaller tech companies – particularly in Taiwan – that rely on the labour  – are a little bit worried they’ll go bankrupt because of it. Bigger companies, like Terry Gou’s Foxconn, have decided the best way forward is to slowly cut out the human element as much as possible and will edge towards robotics. 

Forget Brick Lane and boozers in Bow, all of East London is going to be a technology powerhouse according to the Tories. There aren’t quite enough jobs to go around so young Brits are being encouraged to create their own. It will be bolstered, we are told, by computer science in the curriculum and with the help and advice of big tech companies settling in the area. But pundits say there is nowhere near enough cash in the coffers to make a heap of difference, and critics suggest the government has, for some reason, forgotten that the UK is actually rather good at tech already, just not so much in London. We’re on the Tech City Map, by the way.