PAC 106 – The Global Restructuring of the PC Industry Microsoft’s Forced Restart

By Justin Chiu

Translation: Lawrence Myers

Passage au crible n°106

Pixabay

On February 4, 2014, Satya Nadella succeeds Steve Ballmer and thus becomes the third general manager of the American giant Microsoft. As for the group’s founder, Bill Gates, he is leaving his position as president of the board of directors stating that he wishes to devote more time to the company as a technical advisor. In all reality, observers were expecting an outsider to come on board in order to overhaul the company’s current strategies. Clearly, this internal nomination is evidence of the desire to go beyond the PC industry since S. Nadella had been directing the division known as Cloud and Enterprise until his recent promotion. This division has been the sole branch within the company posting positive growth. However, in recent years, the major weakness of Microsoft as dwelt precisely in its inability to surprise and in its slow decision-making.

Historical background
Theoretical framework
Analysis
References

Historical background

In 1981, the firm IBM produced the first successful personal computer – IBM PC – selling millions of units. By choosing Microsoft and Intel and its operating system (DOS/Windows) and its microprocessor (Intel 8088), IBM furthermore contributed to the rapid growth of both companies. With respect to their products, Microsoft and Intel collectively control the structure of the PC. Since the 1980s, they have developed common strategies, simultaneously launching their new efforts. In so doing, the component manufacturers have no choice but to continuously increase their standards. According to this logic, the Wintel alliance has permitted the PC industry to be completely innovative all the while allowing Microsoft and Intel to maintain their monopoly. On the other hand, the component manufacturers must constantly lower their production costs due to competition. As a result, it is equally important that a PC running Windows software cost less than an Apple computer which keeps the entire chain of production. This in turn reinforces Microsoft’s dominance.

If Microsoft was able to make use of its software in the world market, the American government also played a significant role. In point of fact, at the beginning of the 1980s, Washington defended the protection of intellectual property, in a multilateral framework, as for example with the TRIPS Agreement (Agreement on Trade-Related Aspects of Intellectual Property Rights) finalized in 1994 in the framework of the WTO (World Trade Organization) or on a bilateral level with China in order to obtain more strict regulations in this matter.

Thanks to its dominant position, we shall recall that nine out of ten computers in the world today are still equipped with Windows – Microsoft grants colossal benefits assessed at nearly 27 billion dollars in 2013. But even so the company has lost its innovative image with the emergence of social networks which have put at end to its instant messenger service MSN. Moreover, its search engine Bing, in competition with Google, has proved to be a financial catastrophe (a cumulative 9 billion dollars lost between 2005 and 2011). For that matter, in the cloud computing division, it’s Amazon that until now has taken the upper hand. Ultimately, Google and Apple have succeeded in developing their own smartphone and tablet ecosystems, while Microsoft and Intel are struggling to penetrate this market.

Theoretical framework

1. The creative destruction of digital innovation. Created by Schumpeter, the concept of creative destruction designates a process of industrial change during which the creation of new economic activities brings about the disappearance of more obsolete activities in a given domain. According to the economist Schumpeter, several types of innovation can trigger this process, including the manufacturing of innovative products, previously unseen production or management methods, the opening of untapped markets, etc.
2. The control of the production structure. For two decades, the alliance between Microsoft and Intel has dominated the world PC market along with the norms and standards created jointly by the two groups. Yet, the structural power – concept dear to Susan Strange – exercised by the coalition Wintel on the digital component manufacturers is today largely weakened. Admittedly, the two firms are no longer capable of dictating their personal production rules to the rest of the world. This is even truer for Microsoft which has lost its reputation as an innovative leader following its series of failures.

Analysis

Begun in the 1980s, the convergence of information technology and telecommunications has facilitated the arrival of smartphones and tablet computers, goods intended for the global market. If the PC industry continues to resist this digital wave, its stakeholders will have to innovate more and diversify their activities in order to slow down the decline of this sector which henceforth has become the traditional activity of the high-tech industry.

Undoubtedly, the first objective of S. Nadella’s nomination will be the reinforcement of the cloud-computing division. This will include a host of online information technology services dedicated to companies and public administrators. This new manager will then be able to realize the buyback of Nokia’s cellular division, a deal sealed by S. Ballmer in December 2013. However, it appears difficult to imagine that the combination of the two fallen stars of the high-tech world will be able to produce attractive smartphones. These tiny handhelds lie at the heart of our daily lives and have become so personal and intimate that we must also take into consideration the symbolic value that consumers give them. Moreover, in order to increase its share of the market, Microsoft will certainly not allow itself to produce low-end models. Thus, with a price deemed too high, the tablet that Microsoft created in 2012 – the Surface – does not seem to have been met with definite success. Ultimately, the delay that it endured with Intel in its smartphone and tablet industry hindered Microsoft from taking initiative.

Additionally, the Windows 8 operating system on the market since October 2012, has elicited neither enthusiasm nor replacement of computing hardware. This new phenomenon has disappointed its manufacturers. Acer’s manager was even quoted as saying, “The Wintel era is over” because some manufacturers now prefer to collaborate with other Internet giants like Amazon or Google. Case in point, Google has created products with Asian firms, formerly faithful allies of Microsoft: here we can name the assortment of portable PCs known as Chromebook developed by the Korean Samsung and the Taiwanese Acer, or else the series of Nexus smartphones created with the Korean LG and the Taiwanese Asus.

At any rate, even if Microsoft has lost its reputation as an innovator as well as its structural power in the information technology sector, it should be noted that the other American Internet giants continue to insure that the United States will maintain its global supremacy. Until now, only Google, Apple, Amazon and Facebook have been able to create their own ecosystems based on new technologies and have shown themselves capable of moving closer to manufacturers from around the world.

References

Chiu Justin, « L’anarchie mondiale dans la téléphonie mobile », in : Josepha Laroche (Éd.), Passage au crible, l’actualité internationale 2012, Paris, L’Harmattan, 2013, pp. 117-122.
Kim Sangbae, Hart J. A., « The Global Political Economy of Wintelism: A New Mode of Power and Governance in the Global Computer Industry », in : Rosenau James, Singh J. P. (Éds.), Information Technologies and Global Politics, The Changing Scope of Power and Governance, Albany, State University of New York Press, 2002, pp. 143-168.
Laroche Josepha, « L’Économie politique international », in : Balzacq T., Ramel F. (Éds.), Traité de relations internationales, Paris, Presses de Science Po, 2013, pp. 631-659.
Le Monde, « Avec Satya Nadella, Microsoft mise sur l’après-PC », 5 fév. 2014.
Reich Robert, The Works of Nations. Preparing Ourselves for 21st-Century Capitalism, New York, Vintage Books Edition, 1992.
Schumpeter Joseph, Capitalism, Socialism and Democracy, [1943], Londres, Routledge, 2010. Stopford John, Strange Susan, Henley John., Rival States, Rival Firms: Competition for World Market Shares, Cambridge, Cambridge University Press, 1991. Strange Susan, States and Markets: An Introduction to International Political Economy, Londres, Pinter, 2e éd, 1994.

PAC 105 – The Disinvestment of Public Health Investors World Aids Day

Pixabay

By Michaël Cousin

Translation: Lawrence Myers

Passage au crible n°105

Since 1988, World AIDS Day is observed every year on December 1st. Upon the occasion of this event, public and private stakeholders publish, inform and mediatize the latest developments and the newest decisions relative to the AIDS pandemic.

Historical background
Theoretical framework
Analysis
References

Historical background

In 2011, “Getting to Zero” became the watchword. Launched by the committee, the ambitious project of the World Aids Campaign, is leading financial backers to consider for 2015, “zero new infections, zero discrimination [and] zero AIDS-related deaths”. Theoretically, the conditions exist to make this possible. Scientists have not stopped thinking about therapy and prevention techniques like antiretroviral gel and post-exposure treatment. Ultimately, the costs of triple therapies are decreasing, either because of the expiration of medical patents, or thanks to the implementation of innovative financing like the UNITAID tax set between 1 and 40 levy dollars per plane ticket.

Yet, only a few months remain to attain these results. Among them, the thorough reexamination of discriminations seems difficult to carry out. In this case, depending on geographical zone or country, international cooperation confronts gender inequality more or less seriously, and touches on – or even avoids – the problems that sexual minorities, prostitutes and drug users encounter. However, faced with these difficulties, inter-state organizations are not giving up in matters of finding financing.

In this state of mind, UNAIDS – joint HIV/AIDS program cosponsored by the United Nations and the World Bank – is announcing the 2014 creation of a new Zero Discrimination Day to be celebrated on March 1st, whereas other institutions are targeting youth (between 10 and 19 years of age). The WHO (World Health Organization) hopes, for example, to improve the prevention, treatment and care for adolescents next year. For its part, UNESCO (United Nations Educational, Scientific and Cultural Organization) is committing to raise the awareness of a minimum of 95% of youth concerning sexual health, notably this thirty-year-old virus, as the United Nations recommends. For all that, each year international endowments are eroding while nationally they are growing.

Theoretical framework

1. The efficiency of official development assistance (ODA). It can be analyzed more and more based on performance indicators. This orientation mostly drives financers to favor results-based management. Nonetheless, this method more so favors the resolution of a program – will the predicted solutions be attained? – than its necessity for beneficiaries.
2. The erosion of aid. The inefficiency of cooperation policies also provokes a decrease of investments. Despite several decades of financial contributions, the persistence of difficulties within developing countries indeed results in a certain weariness among lessors, which in turn translates into a deterioration of benefits.

Analysis

Since the 1980s, inter-state organizations are increasing programs directed towards specific objectives. As an example, the World Bank launched the “War Against Poverty” at the beginning of the 2000s, to conform to first of the United Nations’ eight MDGs (Millennium Development Goals). As for the seventh goal, it plans to contain the spread of HIV. The mobilization “Getting to Zero” also feeds this point by two other ambitions: the break down of discrimination and the eradication of deaths.

Besides the fact that these world campaigns guide internal and international institutions, each of their competencies differentiates their public aid policies. However, that does not determine the way in which they will then be led, because these authorities chose and attribute their financial flows differently according to the country. Thus, certain young homosexuals from sub-Saharan Africa will not benefit from UNESCO’s HIV/AIDS prevention plan, despite the fact that they are the population intended for these categories.

Results-based management produces even more harmful effects. In this situation, the acquisition of a loan can simply depend on a dominant vocabulary, which has become fashionable, such as discrimination against women, good governances, or maternal seroconversion. This logic affects project managers and their collaborators as much as it does beneficiaries. In the case of recipients, it is often about representatives seeking to divert funds in favor of other actions that they consider more necessary, even to assure their personal enrichment.

Despite the attempts of selectivity, the inefficiency of aid demotivates investors. The reactivation of their interests therefore assumes a renewing of discussions. However, the UN is still striving to attain its MDGs which will most likely fail. To do this, it is organizing “1,000 Days of Action”, in other words, the time remaining to “act and assure” the accomplishment of the eight objectives. Otherwise, it is also intending to renew this plan beyond 2015, concentrating the next time on equality.

In a similar process, the multiplication of International or World Days radically changes their function. It is no longer fitting to develop a day with the intention of providing the public with knowledge about a problem of transnational importance – AIDS, women, etc. – but rather to create a symbolic event to target and mobilize certain players. One can indeed wonder about the opportunity to transform this December 1st into a day dedicated by UNAIDS to discriminations, even though several dates already exist, centered on homophobia and transphobia, persons with disabilities or racism. But these modes of renewal are not sufficient to fight against the disinvestment of silent partners, especially as the recent victories won over this epidemic remain fragile and cannot handle an erosion of loans. Indeed, even if above all these contributions permit access to care, such reductions would affect research because these treatments continue mostly to be intended for a population bearing few financial resources, pharmaceutical industries would therefore experience a loss of income.

Certainly, the curve of new infections has leveled off since 2010. Yet, in 2009, the sums allocated to this pandemic dropped by 8.7 billion dollars and in 2010 by 7.6 billion dollars; suffice it to say that the situation is very worrying.

References

Bourguignon François, Sundberg Mark, «Aid Effectiveness», The American Economic Review, 97 (2), 2007, pp. 316-321.
Charnoz Olivier, Severino Jean-Michel, L’Aide publique au développement, Paris, La Découverte, 2007. Coll. Repères.
Gabas Jean-Jacques, Sindzingre Alice, « Les Enjeux de l’aide dans un contexte de mondialisation », Les Cahiers du GEMDEV, 25, 1997, pp. 37-71.
ONU, « Lancement de la campagne “Zéro discrimination” à l’occasion de la Journée mondiale de lutte contre le sida, 1er décembre 2013 », http://www.un.org/fr/events/aidsday/2013/zerodiscrimination.shtml.
OMS, « Campagnes mondiales de santé publique de l’OMS : Journée mondiale du sida », http://www.who.int/campaigns/aids-day/2013/event/fr/index.html.
UNESCO, «Journée mondiale de lutte contre le SIDA : Objectif zero », http://www.unesco.org/new/fr/unesco/events/.

Géopolitique de l’Arctique Thierry Garcin, Paris, Economica

Giving priority to a multidisciplinary approach, the author clearly shows that global warming confers a new dimension of international politics on the arctic world. Certainly, shipping routes still seem far from permanent. But, still freshly etched out, they are already leading to concerns which are upsetting State relations. It is a question of five neighboring countries – Canada, Denmark, the United States, Norway, and Russia – and wherever there is a question of China or the European Union, the wealth of the fishing industry and raw materials arouses serious tensions. As for the exponential growth in tourism, this sector presents an equally serious case.

Thierry Garcin does not limit himself to an inter-state analysis. He also discusses non-state figures while putting the situation of native populations into perspective. In the future, one will have to expect this “overlay of cultures” to rise about thirty.

Thierry Garcin, Géopolitique de l’Arctique, Paris, Economica, 2013, 186 p., [Bibliography and analytical index. This work also contains 16 maps and 20 boxed texts].

PAC 104 – A Discredited Organization Between Denial and Impunity The United Nations Facing the Cholera Epidemic in Haiti since October 2010

By Clément Paule

Translation: Lawrence Myers

Passage au crible n°104

Source: Chaos International

On January 12, 2014, the Republic of Haiti commemorated the fourth anniversary of the destructive earthquake that devastated the metropolitan area of Port-au-Prince and the immediate surrounding region. Yet, another catastrophe, this one sanitary, arose in the country at the end of 2010. It concerns the cholera epidemic which to date has cost the lives of nearly nine thousand people on the island of Hispaniola. Despite the united efforts of international aid operators and Haitian authorities for more than three years, centers of Vibrio cholerae remain active in twenty locations, according to a recent communiqué produced by the MSPP (Haitian Ministry of Public Health and of the Population). While the uncertain battle against this lethal poison is being organized, the controversy on the origin of the contamination reached a major scale when the suspicions were directed towards a Nepalese contingent of the MINUSTAH (United Nations Stabilization Mission in Haiti), the multilateral peacekeeping force present in Haiti since 2004. The responsibility of the United Nations in triggering the worst contemporary cholera epidemic is now a major debate.

Historical background
Theoretical framework
Analysis
References

Historical background

The sanitary crisis began in autumn 2010 in the Center county of the country, not far from Mirebalais, a city located sixty kilometers northwest of Port-au-Prince. Until then unknown in Haiti, the disease spread very rapidly, to such an extent that in November 2010, an official of the MSPP alluded to a concern for national security. The humanitarian response by stakeholders in international assistance came together under the leadership of the WHO (World Health Organization), of the CDC (Centers for Disease Control and Prevention) and of NGOs (Non-governmental organization) like MSF (Doctors Without Borders) with the extension of centers and treatment units in the entire country. Otherwise, authorities seemed overloaded by a series of emergencies, particularly the landfall of Hurricane Tomas on the island at the beginning of November, which complicated an already unstable situation. Several hundreds of thousands of people, categorized under the label IDP (internally displaced people), are still living in tents within the capital traumatized by the January 12 earthquake. In this case, the scourge quickly spread to the entire Haitian territory before striking the Dominican Republic – tens of thousands of cases – and to a lesser extent Cuba.

But the question of the introduction of Vibrio cholerae was immediately the subject of persistent rumors designating a MINUSTAH military base situated in the Mirebalais region. In this instance, the investigations carried out on the pathogenic strain of the bacteria permitted the determination of its Asian origin – of serotype O1 El Tor Ogawa -, therefore imported. Beginning in December 2010, the publication of an epidemiological study lead by a French doctor seemed to confirm the trail of the UN peacekeeper camp whose deficient drainage system – confided to a Haitian subcontractor – supposedly set off the contamination of a tributary of the Artibonite, the largest river in Haiti. After several weeks of controversy, other studies strengthened this hypothesis and definitively rejected the alternative theories of a spread beginning on the coast due to the climate situation.

For the moment, more than 6% of the Haitian population is allegedly concerned by the illness – that’s more than 700,000 cases, likely an under-valued assessment – which continues to kill by recurrent outbreaks, in particular in remote areas where medical personnel remains insufficient and access to water nonexistent. In this regard, we can cite the statistics by the MSPP from the third week of January 2014: 75 people were hospitalized, and three of them succumbed to Vibrio cholera. If from now on the threat appears relatively contained, the country remains in a state of permanent wakefulness and the eradication should spread for years – even decades – while international emergency programs are closing, for lack of financing.

Theoretical framework

1. The irresponsibility of an international organization. If the SNU (United Nations System) has firstly ignored the controversy, its representatives have progressively developed rhetoric centered on the technicalization of the problem and the implicit refusal of all forms of accountability.
2. The timid mediation of an outdated State. For a long time unmoving in this sociotechnical controversy, the Haitian government recently attempted to regain control by proposing a series of initiatives aiming to find a political solution to the health crisis.

Analysis

Adding to a national context that since 2004 is already affected by the presence of foreign troops, the mobilization of victims is organized around movements such as the COMODEVIC (The Collective Solidarity with the Victims of Cholera) or the MOVIK (People Who are Cholera Victims). Several protests have taken place in the country – and in New York – in order to demand symbolic compensation from the United Nations – in the form of a public apology – and material compensation, namely indemnities for mourning families. Note that these protesters activities have been passed onto the legal field, in particular with the filing of a complaint in November 2011 in the name of five thousand people represented by two sister organizations: the IJDH (Institute for Justice and Democracy in Haiti) – an NGO founded by an American lawyer and human rights expert – and the BAI (Bureau des Avocats Internationaux) [International Bureau of Lawyers], its legal counterpart. Two years later, a new measure has been undertaken against the UN by Haitian legal experts in New York in order to demand compensation for the population. Finally, we can cite the publication from the end of 2013 of an overwhelming report drafted by researchers from Yale University, which incriminates the MINUSTAH, both in terms of public health and law.

However, during the first weeks of the epidemic, UN leaders were limited to a strategy of systematic denial: moreover, executive staff of the WHO and the CDC, opting for the technical treatment of a health problem, affirmed that the investigation of the origin of the scourge did not constitute a priority. Let us recall that at that time the country was in an electoral period, and that financial backers had strongly supported the precipitated organization of a presidential election judged essential to the reconstruction process. For all that, the series of experts challenging the MINUSTAH drove the United Nations to conduct a mediatized and legal counter-offensive. In order to reject the claims of Haitian lawyers invoking the SOFA agreement (Status of Forces Agreement) signed in 2004 between the UN and the Haitian government – which most notably provided for the setting up of a claims commission -, in February 2013, the Organization resorted to section 29 of the 1946 Convention on Privileges and Immunities of the United Nations. In this respect, the requests for damages were judged unacceptable: note that the Secretary General Ban Ki-moon spoke out insisting on the 140 million dollars of multilateral funds invested against cholera, all the while implicitly refusing to recognize any responsibility in the health crisis.
Facing the magnitude of the controversy, the Haitian state limited itself to many months of silence, which testifies to its dependence on the international community, but equally the incessant conflicts between the new President and Parliament. The Foreign Minister even declared in October 2012 that he had no proof implicating the UN force in the propagation of Vibrio cholerae. In autumn 2013, however, the Haitian Prime minister began a reversal as he alluded to the “moral responsibility” of the UN before proposing, during the 68th General Assembly of the United Nations, the creation of a mixed structure in charge of finding a compromise. Let us highlight how much this timid way out relies especially on a year plan of eradication of 2.2 billion dollars, which aims to construct an efficient network of water and sanitation all the while containing the epidemic by campaigns of oral vaccination. For as much, this late initiative will only receive 1% of its funding from the United Nations which prefers to appeal to the private sector and to philanthrocapitalism. So the implicit strategy of impunity chosen by the United Nations appears to have to be paid by its complete discredit. In this case, the cholera scandal in Haiti shows the limits of an approach focused on a population who needs treatment while neglecting the necessary accountability to the people.

References

Paule Clément, « La gestion capitaliste d’une catastrophe naturelle. Le deuxième anniversaire du séisme haïtien, January 12, 2012», Fil d’Ariane, Chaos International, Feb. 2012.
Transnational Development Clinic, Jerome N. Frank Legal Services Organization, Yale Law School, Global Health Justice Partnership of the Yale Law School and the Yale School of Public Health, Association Haïtienne de Droit de l’Environnement,
« Peacekeeping Without Accountability. The United Nations’ Responsibility for the Haitian Cholera Epidemic», August 2013, available at : http://www.yaleghjp.org [January 11, 2014].

Traité de relations internationales Thierry Balzacq, Frédéric Ramel, Paris, Presses de SciencesPo

Those responsible for this authoritative publication have brought together nearly sixty contributing writers in order to fill a flagrant absence. Until now, there has been no defining work on International Relations for the French-speaking world. From now on, this ambitious and exhaustive work will remedy that problem. Appropriately refusing to abandon this discipline to the Anglo-Saxon world, which has dominated the IR scene for more than a century, the authors leave nothing out as they paint a complete panorama of all there is to know on this subject. Accommodating both scholarship and simplicity, the authors underscore a research-based approach, analyze the different fields which make up IR and consider how to spread this knowledge while maintaining a concern for both expertise and pedagogy. Already this multi-author brainchild reveals itself to be an indispensable tool for a large readership of students, researchers, politicians, and diplomats lest we leave out the enlightened reader who will find in this resource a way to think about the world.

Thierry Balzacq, Frédéric Ramel, Traité de relations internationales, Paris, Presses de SciencesPo, Date, 1228 p., [In addition, this work contains maps, boxed text, graphics and charts as well as an index].