This is my 30,000 foot look at events in the ICT industry for May 2012. 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 May in previous years …
May 2008saw HP pay almost $14 Billion for EDS, and CBS paid $1,75 Billion for the CNet suite of web based sites. There was much concern about the impending economic crisis and the sub-prime debt debacle.
Three years ago in May 2009the early signs of a recovery were evident, but there were still bad-news stories, revenue at the large staffing companies was down 30% in the first quarter; Sony(8,000),BT(15,000),Seagate(1,100) and HP(6,000) all announced new layoffs, while Microsoft continued with its second round of planned layoffs. On the M&A front the telcos continue to feel pain with Verizon selling off 14 states worth of wireline assets to Frontier Communications for $8.6 Billion. Facebook received an injection of $200 million from Digital Sky Technologies (which would value the company at $10 Billion); and NetApp paid $1.5 Billion for Data Domain.
Two years ago in May Twenty-Ten the world was in much better shape economically, but there are still plenty of concerns ranging from the financial impact of the volcanic ash on the world’s airline, to the meltdown of the Greek economy to the lingering effects of the recession and the debts that countries incurred to help the recovery. The big deal was SAP’s $5.8 Billion purchase of Sybase. Google picked up two companies GIPS and BumpTop and invested in a third Recorded Future(a company that claims to forecast the future). Cisco added Moto Development and CoreOptics. The other big dollar deal was Symantec’s $1.28 Billion deal to buy the security assets of Verisign.
Last year in May 2011probably the biggest news was Microsoft’s record breaking offer of $8.5 Billion for Skype. Other M&A activity included Nvidia paying $367M for Icera; Rambus buying Cryptography Research for $342M in the security space; Sandisk acquiring Pliant Technology in the storage world for $327M; and Twitter paying $40M for a Twitter Application, TweetDeck.
Which brings us back to the present …
May 2012 saw the long anticipated, but somewhat disappointing start of Facebook’s appearance as a public company! There was also a fair amount of M&A activity, the largest deal being SAP’s $4.3 Billion acquisition of Ariba with CGI’s $2.8 Billion acquisition of Logica PLC of particular interest to those of us here in Canada! EMC continues its pattern of acquisitions with the $430 million purchase of XtremIO: perennial acquirer Oracle paid $300 million for social media marketing firm Vitrue; in the storage space Seagate paid $186 million for a controlling interest in LaCie; Microsoft invested $300 million in a Barnes & Noble subsidiary; and LinkedIn paid $118 million for Slideshare. There was plenty more activity, but with the amounts not published. Twitter bought RestEngine; IBM bought customer analytics company Tealeaf Technology; VMware bought Wanova; and Cisco bought Truvisco. Google’s deal to buy Motorola mobility also received final blessing, which will prove interesting in the mobile space as we move forward.
Other companies in the news, but this time for layoffs, saw HP announce a fresh round of cuts, this time 27,000 jobs and T-Mobile USA cutting 900 jobs.
Gartner reported that IT offshoring companies are doing well in the current economic climate, growing at about for times the rate of the global IT services market. The smartphone market grew some 42.5% and Samsung overtook Apple as the fastest selling vendor.
On the economic front Canada appears to be doing OK, and possibly fantastic compared to other markets. Canada added 58,000 jobs in April and the unemployment rate is around 7.2%, as against 8.2% in the US and about 10.2% in Europe. The US does seem to be improving however with several positive indicators this month. Most of Europe, with the exception of Germany and possibly France, remains mired in difficulty.
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 June 2012industry news in just about a month’s time.
Walk Fast and Smile.