This is my 30,000 foot look at events in the ICT industry for January 2015. 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 Januarys …
Five years ago in January Twenty-Ten there was cautious optimism about recovering from the recession, but no real blockbuster M&A deals. Oracle, Apple, EMC, and Cisco did continue to demonstrate their appetite for acquisition. Perhaps the most interesting acquisition saw PWC here in Canada return to the IT consulting business with the acquisition of Allstream’s non-telecom consulting business, several years after exiting the business by selling it to IBM. It is worth noting that Apple released its brand new iPad.
In January 2011 economic news was generally positive, Steve Jobs announced his leave of absence from Apple and Larry Page assumed the CEO role at Google. There were also some big M&A deals, the largest being the $3.1 Billion acquisition of Atheros Communications by Qualcomm. Verizon paid $1.4 Billion for Teremark Worldwide and IGate paid $1.2 Billion for Patni Computer Systems. Also out spending money were Dell, Google, Cisco and Salesforce.com.
Things were very quiet in M&A three years ago in January 2012. Former tech giant JDSU was back on the acquisition trail, even if just to pick up a small Vancouver based company, Dyaptive Systems. Symantec paid $115 million for LiveOffice to help with its storage capabilities, Google bought a bunch more IBM patents, and Xerox picked up Laser Networks in the managed printing space. Rim (now Blackberry) also announced a change in leadership.
Two years ago in January 2013 Cisco bought mobile network software company Intucell for $475 million and sold its Linksys division to Belkin. The biggest dollar value deal was AT&T’s purchase of some of Verison Wireless’s airwaves for $1.9 Billion. Other deals saw NCR buy video software ASTM company uGenius Technology; Canon Canada acquired long-time partner and document management company Oce Canada; NetSuite bought retail management systems company Retail Anywhere; and AVI-SPL bought Duocom-Duologik.
January 2014 was an interesting month with a few big M&A deals. Google was an especially busy player, selling its Motorola Mobility handset unit to Lenovo for $2.9 billion but paying $3.2 billion for Nest Labs and the company also bought Bitspin. The other big deal saw VMware pay $1.17 billion for mobile device management company AirWatch. Other big names on the acquisition trail included Oracle who bought cloud based service delivery company Corente; Microsoft paid a reputed $100 million for cloud based service company (seems to be a theme) Parature; Ricoh purchased IT service company Mindshift from BestBuy; and Hootsuite bought analytics company uberVu.
Which brings us back to the present…
January 2015 in the technology business world was an interesting one, as we deal with dropping oil prices, changing currency rates and their affects, both good and bad on various industries. January did see some interesting M&A activity, a US economy that seems to just keep rebounding and a Canadian economy that seems to be slowing somewhat.
On the M&A front the biggest deal, should it materialize will impact mobile users in the UK, reducing competition, with Hutchison offering more than $14 billion for O2. Other big dollar news sees Yahoo looking like it might be remaking itself, spinning off its $40 Billion stake in Alibaba to become smaller, leaner and either buy or be bought! The final M&A activity involving a “B” sees Telco equipment company Commscope offering $3 billion for TE Connectivities network business.
There were also a number of very well-known companies out buying in January, and in no particular order … Amazon is paying something like $300 million (approximate) for chip designer Annapurna Labs; Expedia is buying its online travel competitor Travelocity for $200 million; Samsung is buying Brazil’s largest print company Simpress for reputedly close to $100 million; Google is chasing mobile payments company Softcard (again $100 million seems to be the ballpark); Facebook has bought Wit.ai a company that has a Siri like solution that can be embedded in other products; Dropbox is buying CloudOn a document editing and productivity tools company; Twitter is paying somewhere between $30 million and $40 million fpor Zipdial, an Indian company that does some funky marketing thing with phone hang ups (I don’t get it); and finally Microsoft made two acquisitions, startup text analytics company Equivo and in a departure from its history it bought open software company Revolution Analytics.
Other companies in the news included IBM who refuted rumours that they would be laying off up to 26% of their workforce, with the explanation it would ONLY be thousands. It appears that EMC results, caused by the strength of the dollar will result in layoffs there. Spacex got an injection of $1 billion to help fund its projects, which just might mean supersonic train travel … bring on that Hyperloop!
The US economy seems to be on fire adding more than 200,000 jobs a month, with 240,000+ in December, a growing GDP and lots of positive indicators. Canada on te other hand thought it had added 185,000 jobs in 2014 … and had to revise that down by a third to 120,000. Canada’s GDP was down and the unemployment rate sat at 6.7% in December. Canada’s dependence on its resource base might be cause for concern as we move through the year, given the price of a barrel of oil.
Finally the Global Talent Competitiveness Index tells is that Canada placed 5thin the world, one place behind the US and 2 places above the UK. Not sure how real that is … but 5thisn’t so bad in the whole world!
January certainly saw a lot of activity and if Canada can take advantage of the strength in the US economy it could bode well. An increase in the price of oil wouldn’t go amiss either! That has been my look at the tech news for January … Walk Fast and Smile!