This is my 30,000 foot look at events in the ICT industry for December 2008. What you see here is a precis of the monthly report I produce, which will is available in more detail at the Eagle website. You will also find back issues on the website.
Two years ago in February 2007 there was plenty of M&A action and the big news was the Oracle purchase of Hyperion for $3.3 Billion. There was also some big layoffs with both Nortel (2,900 people) and Alcatel-Lucent (12,000) announcing layoffs in their ongoing attempts to fix their respective woes. Last year in February 2008 Nortel was still announcing layoffs (its been a long process . and not over yet). The news centred around economic uncertainty and signs of what we are indeed experiencing today!
Here we are February 2009 and again my monthly industry news is more about layoffs and economic uncertainty than the good stuff . but we can’t change reality. NEC (20,000), Panasonic (15,000), Nortel . again (3,200) and Micron Technology (2,000) all announced significant layoffs. Nortel emphasized their woes with the sale of their Alteon asset for less than $18 million, which they bought for $7 billion nine years ago!
There was not much action in the M&A space, Oracle and Novell made some small acquisitions and Motorola decided to get out of the mobile email business and Fujitsu is selling 80% of its hard disk drive business to Toshiba.
The story on layoffs wasn’t good, with January numbers 45% higher than December . and three times the numbers from 2008. here in Canada we lost 129,000 jobs in January . but Statistics Canada numbers do seem to trail reality, those numbers don’t seem to reflect what we know of the “hit” on the oil sands projects in Alberta. IT salaries are shrinking, the semiconductor market is down about 15% this year and here in Ottawa the competition bureau charged 7 companies and 14 individuals with bid rigging . ouch! A report lists the top 25 most dangerous cities to outsource to, and suggests a trend towards near-shoring . GOOD NEWS in the sea of bad!
Perhaps the brightest light for the month was an announcement by Intel that it is investing $7 Billion of its own cash in building next generation chip plants! Follow that up with emerging details that the economic stimulus packages from various government are finding their way to the IT sector ($52.4 Billion in the US) and maybe it is not all bad!
That’s what caught my eye over the last month, the full edition is available by clicking here to go to the appropriate part of Eagle’s website. Hope this was useful and I’ll be back with the February 2009 news in just about a month’s time.