This is my 30,000 foot look at events in the ICT industry for February 2014. 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 Februarys …
Five years ago in February 2009 the news was ALL about layoffs and economic uncertainty. Nortel, in addition to their layoffs sold their Alteon asset for less than $18 million, which they had bought for $7 billion nine years previously!
In February 2010 M&A activity was slow with no huge buys. Google bought Aardvark; Oracle purchased a couple of smaller entities; IBM bought a small network software company that focuses on the telco vertical; and Sybase bought a company that has a strong foothold in the financial services vertical. There were lots of signs that the recovery was under way and Canada saw some job growth after a period of decline.
February 2011 was another quiet month for M&A with HP buying Vertica; Opentext bought Metastorm ($182 million); and Rackspace acquired Anso Labs. World news was dominated by the popular uprisings in a growing number of countries and the reactions of those governments including the brutality of Gaddafi’s Libyan supporters.
Two years ago, February 2012 was not a blockbuster month for M&A, but there was some interesting activity. The biggest deal of the month saw Oracle pay $1.9 billion for talent management company Taleo. Siemens Canada paid $440 million for networking equipment company Rugged.com. IBM bought BYOD company Worklight; Dell bought backup and recovery company AppAssure; Apple bought mobile search company Chomp; and LM Ericsson bought Ottawa based BelAir Networks.
Last year in February 2013 Dell went private in a $24.4 billion deal, that included a $2 billion investment by Microsoft. Oracle paid $1.7 billion for networking company Acme Packet Inc.; Rackspace bought big data company ObjectRocket; Telus was busy with two acquisitions, electronic medical records division of the Canadian Medical Association and digital forensics company Digital Wyzdom; HP also sold the Palm operating system to LG for their smart TVs.
Which brings us back to the present …
February 2014 saw Facebook make a big move with $16 billion acquisition of Whatsapp, which is probably good valuation news for Blackberry because its BBM product would be a direct competitor. Blackberry however had another rough month when IDC released its numbers as the company’s smartphones accounted for only 1.9% of sales in Q4 of 2013.
Another company with big news, although not necessarily positive was Sony. They appear to be reinventing themselves in their various niches as they are closing their eReader store and divesting themselves of their PC division (Vaio).
In other M&A news Comcast is making a $45 billion play for Time Warner Cable; Oracle paid a reputed $400 million for data management platform company Bluekai; LinkedIn paid $120 million for online job search company Bright; and Klout was bought for about $100 million by Lithium Technologies. Google made a couple of acquisitions, online fraud company Spider.io and secure logon company Slicklogin. IBM is buying database as a service company Cloudant; and Monster bought a couple of companies, social profile company Talentbin and job aggregation and distribution technology company Gozaic.
Other companies making news this month include Microsoft who announced a new CEO, Satya Nadella (who replaces Steve Ballmer) plus a new Board Chair John Thompson (who replaces Bill Gates). Dell starts its new life as a private company with major restructuring, resulting in likely 15,000 job losses. On the good news front, jobs creation and infrastructure additions in Canada come in the form of new datacenters for Bell Aliant and for Telus.In reports from various sources Android has about 80% of the mobile OS market share, with Apple a distant second. Samsung was the dominant handset hardware supplier with 32% share, with Apple second. Apple however accounted for approximately 1/3 of tablet sales in Western Europe last year, with Samsung second.
A Cisco study suggests that users will increase mobile data usage by a factor of approximately 8 over the coming 5 years … so make sure you have good data plans! The Canadian federal Government announced an infrastructure investment to put broadband into rural communities and Gartner tell us that IT spending was flat year over year, for the 13thyear in a row!
Economic news was generally mixed, with no major bad news and no big breakthroughs. Some job growth in Canada and the US, some positive confidence indicators and some not so good. One study seemed to sum it up for me, Careerbuilder found that 58% of employers feel the recession is still lingering!
That is it for my monthly look at what was happening in the technology space over the last month, compared to the same month in previous years. I’ll be back at the end of March, until then …walk fast and smile!