This is my 30,000 foot look at events in the ICT industry for September 2013. 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…
Five years ago 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.
September 2009 saw Dell pay $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.
Three 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.
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 for $525 million. SAP bought Crossgate, Twitter bought Julpan and CSC bought Indian software testing company AppLabs, and Hitachi Data Systems continued the consolidation in the storage industry with the acquisition of BlueArc.
September 2012 was a quiet month in M&A deals. Infosys increased its management consultancy capability with the $330 million purchase of Lodestone. Lenovo bought Stoneware, a software company focused on the cloud, and Ericsson bought ConceptWave. A couple of interesting investment moves saw Microsoft invest in Klout and Silicon Valley VC Chameth Palihapitiya invest in Xtreme Labs.
Which brings us back to the present …
September 2013 saw a number of companies struggling. Blackberry announced a quarterly loss of almost $1 million, laid off 4,500 people and after failed attempts at recovery is being taken private by its largest shareholder. HP was dropped from the Dow Jones Industrial Average, reflecting its challenges in recent years. HTC is struggling for relevance in the tough smartphone market place and Siemens announced layoffs of 15,000 people as it struggles to contain costs.
It wasn’t all doom and gloom, with IBM announcing a $1 billion investment in its Linux business, Twitter tweeting that it would be going ahead with an IPO and Apple getting the best customer satisfaction score amongst major PC manufacturers.
There were some very positive indicators in the various employment reports, surveys and indices this month. Employment was up last month in both the US and Canada, there are signs of more hiring in many sectors and surveys showed optimism from Canadian CPAs, mid-market executives and North American employees.
On the M&A front the biggest deal saw Microsoft get into the phone making business, buying Nokia’s devices and services unit for more than $7 billion. The other big deal, as already mentioned, sees Fairfax Financial Holdings, currently Blackberry’s largest shareholder, offer $4.7 billion to take the company private. Ebay is paying $800 million for payment platform Braintree; Synnex is buying IBM’s customer care division for $505 million; Rogers is adding to its data centre capacity with the $161 million purchase of Pivot Data Centres; Extreme Networks is buying Entersys Networks for $180 million; and my old employer, Manitoba Telephone Systems is using some its cash from the Allstream sale to buy Epic Information Systems.
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 October 2013 industry news in just about a month’s time.
Until then, Walk Fast and Smile!