This is my 30,000 foot look at events in the ICT industry for November 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 previous year’s Novembers …
Five years ago in November 2008 the big news was the economic maelstrom that took the world by storm. There was some M&A activity with AT&T paying $944 Million for Centennial Communications and Fujitsu paid $575 Million to buy out Siemens from a joint venture but the biggest “noise” was about layoffs and the general impact of the recession.
In November 2009 there was still a “hangover” from the recession, but the general mood was more optimistic. There were still layoff announcements, Adobe (680), Microsoft (800), and Rogers (900) all announced layoffs and Right Management told us that as many as 80% of employees may look to change job as the economy recovers! The big news in M&A saw HP buying 3-Com for $2.7 Billion and Nortel continued to sell off its assets, this time its Metro Ethernet Networks business to Cienna for $769 Million. Google also made a couple of acquisitions, including paying $750 million for AdMob.
Three years ago in November Twenty-Ten perennial acquirer EMC paid $2.25 billion for Isilion; Attachmate bought Novell for $2.2 Billion; Oracle paid $1 Billion for Art Technology Group; NTT paid $1 Billion for Keane; Amazon paid $500 million for Quidsi; and Juniper Networks bought Trapeze Networks for $152 million.
In November 2011 Mosaid was sold to Sterling partners for $590 million, ending a WiLan hostile takeover attempt. Japanese company Rakuten paid $315 million for e-book company Kobo; Huawei technologies bought Symantec out of a storage and security joint venture to the tune of $530 million; Yahoo paid $270 million for online advertising company Interclick; and Best Buy paid $167 million for internet technology company Mindshift.
Last year in November 2012 Cisco made two significant “buys”, cloud infrastructure company Meraki ($1.2B) and cloud datacentre and software company Cloupia ($125M); Dell bought software tools company Gale Technologies; NCR bought retail software company Retalix ($650M); Cray bought software company Appro ($25M); Sprint Nextel bought a chunk of US Cellular ($480M); and Toronto based NexJ (headed by another ex-Andersen Consulting alumni) bought Broadstreet for $8.2 million.
Which brings us back to the present …
November 2013 was particularly slow on the M&A front, which is right in line with the Capital Confidence Barometer, a report suggesting that while Canadian executives feel confident about the economy it does not seem to be translating into M&A activity. Perhaps the same can be said for executives around the world? There was however SOME activity and it was Canadian “darling” Opentext that paid $1.1 Billion for cloud based integration services company GXS Group. Another Canadian deal saw Mitel buy Aastra for close to $400 million, and the final Canadian deal (hardly in the same league) was Eagle’s first acquisition of Valianz, a Montreal based staffing company. Other deals this month included ebay’s $800 million purchase of global payments company Braintree; Apple’s $370 million purchase of 3D sensor company PrimeSense; and Akamai’s purchase of Velocius Networks.
Other companies in the news in November include Blackberry, as they attempt to recover via layoffs, a change in CEO, and multiple changes in the executive suite; Acer who are also coping with their shortcomings in a tough PC market, by changes at the top and potential layoffs; and Huawei who are investing $600 million into 5G network research (I’m just getting used to 4G)!
A survey from the Technology Council of North America raised the concerns about shortages of tech talent while CompTIA tell us IT Security is the top technology priority of CIOs. There were several positive indicators of confidence amongst US workers, and a TEK survey suggests tech leaders are looking to hire in 2014. Canadian unemployment is still down below 7% and Canadian workers are the most content with their jobs according to a Monster survey.
That's my view of the tech industry from November 2013… as we head into a typically quieter period at the end of the year. There continues to be quiet optimism in the economy, but I think it’s about time we made it noisy! There are still many companies holding back because of the number of potential negatives that might happen!
Let’s make some noise in 2014! Walk Fast and Smile!