The Eagle Blog

IT INDUSTRY NEWS – January 2011

This is my 30,000 foot look at events in the ICT industry for January 2011. 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. 

I think it’s 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 January 2007 there was no talk of recession, and worker confidence was relatively high.  The big news was Microsoft’s launch of Vista and AOL’s $1 Billion purchase of Tradedoubler.  Three years ago, in January 2008, there was much talk about an impending recession.  Dell, Palm and Yahoo all announced layoffs, while Oracle paid $8.5 Billion for BEA, Microsoft paid $1.2 Billion for FAST and SUN paid $1 Billion for MySQL.  Two years ago in January 2009 it was a different story altogether as the world’s economies melted down! The one sizeable M&A deal was the $775 million purchase of Interwoven by Autonomy.  Confidence with IT workers and CEOs alike was at an all time low, and there was a long list of (significant) companies announcing layoffs.  Satyam announced a major financial accounting scam and former Canadian “tech star” Nortel, filed for bankruptcy protection.  Last year in January Twenty-Ten there was cautious optimism in the air, but not much in the way of blockbuster M&A deals however Oracle, Apple, EMC, and Cisco continued their fairly steady acquisition pace.  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.  In other news Apple released the much anticipated iPad. 

 Which brings us to January 2011, and an economy that while not perfect, is still generally heading in the right direction.  Lots of good news … globally an all-industry index was at its highest level in the last ten months.  In the US, GDP is growing, employment is growing and CEOs are more confident.  The EU economy is growing too, fuelled primarily by German and French strength despite the economic woes in Spain and Ireland.  Here in Canada we added more jobs in December and unemployment remains at a relatively strong 7.6% (US 9.8%; EU 10.1%).

 There were some big M&A deals this month, 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  Local company bitheads also bought a couple of companies (Bedlam Games & Playbrains) to form a new entity.

In other news Steve Jobs announced another leave of absence from Apple creating much speculation about why, and Eric Schmidt is moving over to let Google co-founder Larry Page take on the CEO role.  Disconcerting news from PandaLabs tells us that one third of ALL viruses created were created in the last year, however spam levels are down to the lowest levels in almost two years … but that is not expected to last!  Finally the civil unrest in Egypt caused that country to be the first to voluntary sever its connection to the internet! 

An eventful start to 2011, the economic signs are good for most, the pace of change continues to increase and the challenges to the business community keep life interesting.    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 February 2011 industry news in just about a month’s time. 

Walk Fast and Smile.

 Kevin Dee is CEO of Eagle (a Professional Staffing Company)

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