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To Avoid Colocation Costs in Europe, Move North

Gartner, Inc. says that consistently low energy prices and favorable environmental conditions in Northern Europe present an opportunity for IT managers to save up to 50% on their colocation expenses by moving north.

Amsterdam, Frankfurt, London, and Paris represent the major colocation centers for multinational and Pan-European businesses. However, power costs in Norway and Sweden have fallen by 5% since 2010, while the EU average has risen by around 13% in the same period. Moreover, combined with efficiencies from using outside air cooling there is a clear economic and environmental advantage to hosting IT infrastructure in the northern part of Europe.

“It’s important to weigh up several key decision factors when considering moving workloads away from the major colocation hubs to Northern Europe,” said Tiny Haynes, research director at Gartner. “However, in most organizations there are several IT functions such as data warehousing or browser-based apps that simply do not warrant the significantly increased running costs of colocation in a major hub.”

Gartner has outlined some key decision factors to consider in the decision to move north:

Network latency: Some applications like VoIP systems and virtual desktops need a low latency environment to function well, while others simply do not. Categories applications and assign them a suitable location accordingly.

Application requirements: Some applications are standalone, while others are integrated with a range of connected systems. If the application is interdependent, it’s best to keep all the constituent parts within the same data centre infrastructure to avoid timeouts

Security compliance: Data protection laws vary between countries, and certain data or applications that use data may not be suitable for use outside specific geographies.

Power availability: Consider not just the availability to your rack, but also to the data centre and the country itself.

Cooling costs: Consider both the ongoing power usage effectiveness as well as the cooling methods available.

Price: The price of per kilowatt (kW) of infrastructure as well as per kilowatt per hour should be evaluated.

Support: This should either be in-house support from technical teams nearby or support provided through the supplier.

“If considering these factors reveals an opportunity to move workloads and applications to another location, it’s also very important to properly map out the costs over a lifecycle,” said Haynes. “A cost estimate should be considered over at least three years and take into account several price components that make up the total cost.”

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Autoliv Posts Record Q3 Sales

For the three-month period ended September 30, 2014, Autoliv, Inc.  – the worldwide leader in automotive safety systems – reported consolidated sales of $2,208 million, the highest third quarter sales ever for the Company. Quarterly organic sales (for non-U.S. GAAP measures* see enclosed reconciliation table) grew by close to 5%. The adjusted operating margin* was 8.5%.

The expectation at the beginning of the quarter was for an organic sales growth of “around 6%” and an adjusted operating margin of “around 8.5%”. The lower than expected organic sales growth was primarily due to unfavorable vehicle mix in China, but also due to lower overall production in the Chinese market. We had record operating cash flow for a third quarter of $212 million.

For the fourth quarter of 2014 we expect organic sales to increase by around 2%, and an adjusted operating margin of around 9.5%. The expectation for the full year is now for organic sales growth of around 5.5%, and an adjusted operating margin of around 9%.

For Key Figures summary table, please click here.

Comments from Jan Carlson, Chairman, President CEO

“Our strong operational and quality execution continues which resulted in another quarter of solid financial performance. We managed to deliver record sales, gross profit and operating cash flow for a third quarter. In addition, we returned a record $288 million to our shareholders through dividends and share repurchases. Over the last twelve months we have returned $772 million to our shareholders.

During the 3rd quarter our overall solid organic growth continued despite our slower than expected growth in China. Since 2011 we have consistently outperformed the light vehicle production in China, with the exception of this quarter due to a negative vehicle mix. We expect this negative mix in China to continue in the fourth quarter however we remain confident in our long-term strategies for growth and vertical integration in this market.

Uncertainties around the macro environment have gradually increased throughout the year. This has resulted in a slower light vehicle production growth rate for the 2nd half of this year, compared to what was anticipated in January. The early indication is that this slower LVP growth rate will continue into the first half of 2015. We will continue to monitor the overall market conditions very closely and are prepared to take appropriate actions in a timely manner.

During the quarter we also introduced a new operating structure which will be important for the further growth of the Company. Starting in 2015 Autoliv will have two segments for reporting purposes – passive safety and electronics (including our fast growing active safety business). Operational improvements in our European steering wheel operations developed according to plan, while improvement efforts in Brazil are being hampered by the sharp decline in the Brazilian vehicle production.

In this current environment we continue to execute on our three core strategies with quality first, efficiency through one product one process and innovation for long term market leadership”.

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OE-A Celebrates 10th Anniversary

Their two opinions could hardly have been more different: Dr Stephan Kirchmeyer strongly believed in the “dream” that organic and printed electronics would be on the market in high-volume applications someday. “That’s way too early. I don’t believe in the technology,” Wolfgang Mildner said in the late ‘90s. The current OE-A vice chairman soon changed his opinion, recognized the potential of the new technology and, in the end, initiated the OE-A. And the dream of the current OE-A Chairman Stephan Kirchmeyer and many others working with organic and printed electronics came true:Tthe technology is now on the market.

The credit also belongs to the Organic and Printed Electronics Association (OE-A). Ten years ago, the leading international industry association for organic and printed electronics was founded in Frankfurt. Thirty-five founding members, located in four countries, had a vision to promote the young technology to become suitable for mass markets–with the help of the OE-A whose key responsibility it is to promote networking among its members. “Almost 230 members covering the whole supply chain from all over the world make the OE-A the largest and most international working group within VDMA”, Thilo Brodtmann says. The Deputy Executive Director of the VDMA (German Engineering Federation) has been supporting the formation of the OE-A from the beginning.

Not only the number of members has changed over the past 10 years. Back then, the OE-A started with two working groups, Applications” and “Technologies,” in which industry experts laid out a roadmap for organic and printed electronics and its market entry. In the beginning, they took on a big task. In subsequent years, updates to the roadmap were published bi-annually. Right now, the OE-A’s experts are preparing the sixth edition of the roadmap. Today, seven working groups are contributing to it.

Ten years ago, there were many areas where there were no specific potential applications for organic and printed electronics, Dr. Stephan Kirchmeyer says. “Market entry is just around the corner,” is what experts said for years. The technology was ready, but the market was not. “Many people did not expect the path to market entry to be that long,” Wolfgang Mildner says.

Many years ago experts were able to build flexible and bendable displays. They were already mentioned in the first OE-A roadmap. “It was not obvious what these displays could be used for,” Kirchmeyer remembers. Today he says: “In this area we are mainstream.” Smart watches and bendable TV-displays have made their way to the market – available for every household.

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