Back to Resource Centre
Blog Img

IT Industry News - October 2011

This is my 30,000 foot look at events in the ICT industry for October 2011. What you see here is a précis of the monthly report I produce, which will be available in more detail at the News section of the Eagle website, where you will also find back issues.

A Little History of previous year’s Octobers …

Five years ago in October 2006 Oracle paid $440 Million for Stellent and EMC paid $165 Million for Avamar, worker confidence was good, unemployment rates in Canada and the US were low and IT spending was relatively strong.  Four years ago in October 2007 Microsoft valued Facebook at $15 billion when it took a minority stake for $204 million, SAP paid $6.8 billion for Business Objects and Nokia paid $8 billion for Navteq, a mapping software company.  IT workers were happier and more secure than ever, NexInnovations closed its doors and a Royalty Review caused consternation for Canada’s oil patch.  In October 2008 doom, gloom and market meltdowns were the big news.  The number of IT jobs in the US dropped by 2% quarter over quarter and Symantec, eBay and Yahoo all announced significant layoffs.  A $5.8 billion merger of telcos in the US was the big deal of the month, with rural telephone company Century Tel buying its bigger peer Embarq.  Ebay bought 3 companies, Bill Me Later ($945 million) plus Denmark companies Ben Bla Avis and BilBasen ($390 million).  Symantec paid $695 million for MessageLabs, Tata paid $505 million for Citi’s Indian BPO arm and HP paid $360 million for LeftHand Networks.  Two years ago in October 2009 news was mixed as the recovery was under way.  Cisco paid $3 Billion for Tandberg, $2.9 Billion for Starent  and $183 Million for ScanSafe.  Adecco paid about $1.1 Billion for MPS Group (includes Beeline); Emerson Electric beefed up its datacenter capability paying $1.2 Billion for Avocent and Sprint Nextel avoided some legal issues by shelling out $831 million for iPCS. Last year in October Twenty-Ten Bell Canada bought a data center in Montreal (Hypertec) and picked up xwave from its subsidiary Bell Aliant.  Rogers paid $425 million for Atria networks and IBM pick up Toronto based Clarity Systems. 

Which brings us back to the present …

In October 2011 the world’s economies continue to waver, with the EU now agreeing to another bailout plan for its underperforming members.  Employment is still a world problem, but there were some gains in Canada, the US and elsewhere. 

This month will likely be long remembered because Steve Jobs passed away at age 56 … an industry icon about whom much has been said.  Life (and business) does, however, go on and IBM announced a new CEO, the first woman in their history … Virginia Rometty will take charge effective 2012. 

On the M&A front Oracle made a couple of buys, including RightNow Technologies ($1.5 Billion) and Endeca Technologies; Sony bought Ericsson out of their Sony Ericsson joint venture ($1.5 Billion); Red Hat bought storage company Gluster ($136 million); and Cisco bought BNI Video ($99 million). 

In other news Dropbox raised $250 million to fuel expansion, which effectively values the company at $4 Billion.  Lenovo moved into #2 spot in worldwide PC manufacturers behind HP while edging Dell into third! 

Finally a few words for Rim, who seem to be having a tough go of it!  This month they were hit with a global network crash that affected customers for an extended period, further weakening their loyal customer base … which is being eroded by strong competition from both Android and iPhone.  This compounds it misery following a somewhat lackluster launch of its tablet.  If only Jim Balsille had got his NHL franchise, something would have gone right for them!  There is genuine concern that this Canadian icon might not return to its former glory and could become another subsidiary of a large conglomerate … that would not be good news for Canadian industry! 

Here at Eagle we had another strong month, see steady growth and are extremely busy in some markets.  It would however be nice to see world sentiment and economies provide some good news … and remove the nagging worries apparent in the markets today! 

Recovery continues to be a very long slow path, but I believe that we continue to head in the right direction … until next month, stay positive, walk fast and smile!

That’s what caught my eye over the last month, the full edition will be available soon on the Eagle website. Hope this was useful and I’ll be back with the November 2011 industry news in just about a month’s time.