The Eagle Blog

IT Industry News for July 2010

This is my 30,000 foot look at events in the ICT industry for July 2010. What you see here is a précis of the monthly report I produce, which is available in more detail at the News section of the Eagle website, where you will also find back issues.

I think its interesting to look back and see what was news in previous years, and how it might affect news today. Perhaps one of the most noticeable things I see is that some of the most successful and largest companies have a track record of growth through acquisition, and with practice they get very good at it!

Four years ago in July 2006 AMD bought ATI for $5.4B, HP bought Mercury Interactive for $4.5B and EMC paid $2.1B for RSA Security. Three years ago in July 2007 HP paid $1.6B to buy Opsware, Steria paid $1B for Xansa, IBM paid $160M for BI company Datamirror (and still bought Cognos) and Google paid $625M for Postini. Two years ago in July 2008 the big deal was the purchase of Foundry Networks by Brocade Communications for $3B but we were on the brink of what would be one of the worst economic periods in a long time. Last year in July 2009 the economy was suffering and unemployment was high. There was however some brisk activity on the M&A front with Ericsson paying $1.1 Billion in a fire sale auction for Nortel’s wireless carrier assets. That was not the biggest deal of the month however as EMC agreed to pay $2.4 billion for Data Domain AND Big Blue (IBM) paid $1.2 Billion to add to its BI capability with the acquisition of SPSS.

And so … here we are in July 2010, the World Cup is history and triumphed when so many other teams underperformed … including my own England, and here in the real world we continue our slow recovery from the recession. There were some very positive signs for the recovery … Canada added 93,000 jobs in June and Canada’s Staffing Index rose 7 basis points; a CareerBuilder survey suggests that 58% of hiring managers are looking to hire in the second half of 2010; US GDP is still growing, although a little slower; and in the EU it looks like employment is stabilising with an unemployment figure in the 10% range (9.5% in the US and 7.9% in Canada).

There was an interesting report from CRTC that highlights the changing Canadian Telco world, which had growth in revenues last year, but it was fuelled by growth in the wireless and internet services in spite of losses in traditional services.

Apple’s introduction of the iPhone4 sparked the “antennagate” debates, and Steve Jobs came in for some flack before Apple agreed to provide a free case to users to address the antenna problems.

On the M&A front there were a couple of deals in the $ Billions … NTT agreed to pay $3.2 Billion for Dimension Data and Nokia Siemens shelled out $1.2 Billion for Motorola’s wireless network equipment unit (without its patents). There were a couple of deals to buy data compression companies … with IBM buying Storwize and Dell buying Ocarina Networks, and in that same kind of sand box EMC bought data analytics company Greenplum. Google added to its semantic search capability with the purchase of Metaweb Technologies and rumor has it that Apple acquired a small (Quebec) mapping company Poly9 Group. Adobe shelled out $240 Million for a Swiss web software maker, Day Software Holdings and SAS increased its presence in the US Federal market through its purchase of Vision Systems and Technology. Overall a busy month in M&A … perhaps reflective of companies feeling a little more bullish about the recovery? Let’s hope it continues!

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 August 2010 industry news in just about a month’s time.

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