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IT Industry News September 2012


This is my 30,000 foot look at events in the ICT industry for September 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 September in previous years …

In September 2008 the collapse of investment banks and the potential bailout by the US Government filled the headlines.  There was M&A activity but not on a grand scale … McAfee paid $465 Million for Secure Computing and Microsoft paid $485 million for Greenfield Online … a shopping comparison site.  Perhaps the most interesting purchase was by Best Buy, who paid $120million for Napster.  Things picked up in September 2009 with Dell paying $3.9 Billion for Perot Systems and Xerox buying ACS for $6.4 Billion.  Ebay sold its majority holding in Skype to a group of investors for $1.9 Billion and Adobe shelled out $1.8 billion for web analytics company Omniture, in addition to buying Business Catalyst.  Nortel sold its Enterprise Solutions unit to Avaya for $915 Million; EMC added a couple of acquisitions, Kazeon Systems and Fastscale technology; Raytheon picked up internet pioneer BBN and CA shelled out $200 million for NetQoS. Two years ago in September 2010 HP bought 3PAR for $2.4 Billion and they also paid $1.5 Billion for Arcsight and 3M paid close to $1 Billion for Cogent.  RIM bought a substantial part of DataViz, Ericsson beat out a local Ottawa based group in an auction for another piece of the defunct Nortel empire, CA bought Hyperformix; and AOL bought TechCrunch.  Last year in September 2011 Broadcom paid $3.7 Billion for NetLogic.  Google was busy, buying restaurant reviewer Zagat plus acquiring 1,000 patents from IBM.  Ottawa’s Zarlink was bought by Microsemi $525 million.  SAP bought Crossgate, Twitter bought Julpan and CSC bought Indian software testing company AppLabs.  Last word goes to Hitachi Data Systems who continued the consolidation in the storage industry with the acquisition of BlueArc.  Also a year ago Meg Whitman was announced as the new HP CEO and Yahoo fired Carol Bartz (by email)!

Which brings us back to the present …

September 2012 like August, was another very quiet month in M&A deals.  Infosys increased its management consultancy capability with the $330 million purchase of Lodestone.  Lenovo, like most of the hardware companies is diversifying with the purchase of Stoneware, a software company focused on the cloud.  Also Ericsson is diversifying its offerings with the purchase of ConceptWave.  A couple of interesting investment moves saw Microsoft invest in Klout and Silicon Valley VC Chameth Palihapitiya invest in Xtreme Labs.

HP continues to struggle, one year after Meg Whitman took over as CEO, announcing a big quarterly loss and adding 2,000 to the previously announced layoffs.  Mike Lazaridis, one of RIM’s founders pledged $100 million to a new nanotech lab in Waterloo, meaning that he has donated more than $250 million to R&D initiatives in that area.

Cybercrime and malware continue to be news, with the former costing consumers $110 billion globally last year.  Malware is a daily threat we all see, and now the attacks on our mobile devices are ramping up … increasing 2,180% in just one year!

Apple released the iPhone 5 this month and coincidentally took second spot in smartphone market share in Canada.  Top spot is now owned by Android which saw Blackberry, which had held top spot, slip to third.

Unemployment around the world remains an issue, and it was interesting to see Microsoft highlight the “skills gap” phenomena, with high unemployment AND significant numbers of jobs available, at the same time! Microsoft are struggling to fill 6,000 open jobs and yet US unemployment hovers around the 8% mark.  A Global Manpower survey suggests that hiring is improving in some areas of the globe and weakening in others.  Both the UK and US unemployment numbers looked better this month and Canada remained steady at 7.3% unemployment.