IT Industry News – January 2018

A Little History of previous year’s Januarys

Five 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 Verizon 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 Parature; Ricoh purchased IT service company Mindshift from BestBuy; and Hootsuite bought analytics company uberVu. Three years ago in January 2015, the biggest deal was Hutchison offering more than $14 billion for O2. Other big dollar news saw 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” was Telco equipment company Commscope offering $3 billion for TE Connectivities network business. There were also a number of very well-known companies out buying, and in no particular order: Amazon paid something like $300 million (approximately) for chip designer Annapurna Labs; Expedia bought its online travel competitor Travelocity for $200 million; Samsung paid $100 million for Brazil’s largest print company Simpress; Google paid about $100 million for mobile payments company Softcard; Facebook bought a company that has a Siri like solution that can be embedded in other products; Dropbox bought CloudOn, a document editing and productivity tools company; Twitter paid somewhere between $30 million and $40 million for Zipdial, an Indian company that does some funky marketing thing with phone hang ups; 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. There were no huge deals in January 2016, but there was plenty of activity with some of the household names out shopping. IBM bought video service provider Ustream; Microsoft bought game form learning tool MinecraftEdu; Apple bought “emotion recognition” company Emotient; and Oracle bought media web tracking firm AddThis. Toshiba bought an ERP solutions company Ignify, and a number of smaller deals included Juniper Networks buying BTISystems Inc.; FireEye bought iSight partners; Acceo Solutions bought Groupe Techna and SmartPrint bought LaserCorp’s Toronto-based managed print services business. Last year, in January 2017 the multi-billion-dollar deal of the month was Cisco’s purchase of app performance management company, AppDynamics for $3.7 billion. HP Enterprise purchased data center hardware provider, SimpliVity for $650 million. Microsoft acquired Montreal-based deep learning start-up Maluuba for an undisclosed sum. Google announced plans to purchase Twitter’s mobile developer platform Fabric. Trello, the startup behind a leading task-management app was purchased by Atlassian for $425 million. CRM giant, Salesforce bought Unity&Variety to enhance its productivity app service Quip Managed Service Provider of data and database administration, Datavail, acquired Canadian IT channel leader Navantis.

Which brings us back to the present

January 2018 saw the continuing saga of cities bidding to win Amazon’s second headquarters, now down to 20 finalists. The Meltdown and Spectre hardware bugs are causing major headaches for tech companies and their clients, with the potential for hackers to take advantage.

On the M&A front, the big deal saw investment management software company SS&C pay $5.4 billion for financial services software company DST Systems. Amazon Web Services increased its cybersecurity protection capabilities through the purchase of Sqrrl. ADP bought gig economy tool WorkMarket and TD Bank bought a Canadian AI company Layer 6.

The economy is getting “interesting”. After some good indicators in 2017 Canada lost 88,000 jobs in January. It’s likely that the new labour legislation introducing tougher labour laws and increased minimum wages in Ontario and Alberta were factors. The U.S. numbers are still looking good, adding another 234,000 jobs in January. Global CEO confidence is up and indicators around the world still seem positive. A stock market correction in mid-January is, however, causing some concern.

In this Issue:

> General Interest
> Company News
> Merger & Acquisition Activity
> Primary Sources



Global CEO confidence bounced back in the fourth quarter after decreasing in the third quarter, according to The Conference Board’s measure of CEO confidence. In the fourth quarter, the measure increased to a level of 63, up from 59 in the third quarter. Attracting and retaining talent remains the top concern for CEOs as well as the entire C-suite.

The PC market is still declining, according to research firm Gartner; however, IDC found positive growth in Q4 2017 and determined it was the most stable year the market has seen since 2011. But the two agreed on this year’s top three computer makers: HP won, followed closely by Lenovo, with Dell bringing up the rear. Both firms were also optimistic about the PC market, despite more quarters and years in the red than in the black. In short, Gartner and IDC believe computers have hit rock bottom, and a turnaround, or at least a plateau, is due.

Switzerland ranked first internationally in attracting, developing and retaining talent, according to the 2018 Global Talent Competitiveness Index. The UK ranked eighth. The top ten spots were:

  1. Switzerland
  2. Singapore
  3. United States
  4. Norway
  5. Sweden
  6. Finland
  7. Denmark
  8. United Kingdom
  9. Netherlands
  10. Luxembourg

The economy – Canada

According to Statistics Canada, Canada lost 88,000 jobs in January following a gain of 78,600 jobs in December. The unemployment rate fell to 5.9% in January. Of particular note was Ontario losing 51,000 mostly part time jobs, in the wake of new legislation that includes a large minimum wage increase.

The Canadian staffing index, which measures staffing activity in Canada, rose 6% in December on a year-over-year basis to a reading of 102. The increase occurred despite last month having 5% fewer working days than December 2016.

Ontario plans to increase enforcement and raise penalties to ensure employers stick to new rules. The new rules raised the minimum wage to C$14 effective Jan. 1 (and will raise them to C$15 next year), ensured that part-time workers be paid the same hourly wage as full-time workers, introduced paid sick days for every worker and provided at least three weeks of vacation after five years with the same employer.

Ontario plans to hire up to 175 additional employment standards officers, launch a program to educate businesses and employees, and publish the names of employers that don’t meet employment standards.

The economy – USA

Jobs growth in the US shouldn’t slow in the near term, according to The Conference Board’s Employment Trends Index. It rose in December to a reading of 107.10 after little change in November. “The US economy has been significantly accelerating in recent quarters and the tax cuts passed by Congress will provide an additional boost to the US economy in 2018.”

US private sector employment rose by 234,000 jobs in January, down slightly from the gain of 242,000 in December, according to the ADP National Employment Report. However, the number still showed strong growth.

Chief information officers in the U.S. plan to hire more in the first half of 2018 than a year ago, according to the Robert Half Technology IT Hiring Forecast and Local Trend Report.

Economic activity in the manufacturing sector expanded in December at a faster pace than November, according to the Institute for Supply Management’s purchasing managers index for US manufacturing. December’s index reading was 59.7, up 1 from November’s reading of 58.2.

A new report released by the World Economic Forum found 1.4 million US jobs will be disrupted by technology and other factors between now and 2026, and 57% of those jobs belong to women. However, 95% of the workers most at risk would find good-quality, higher wage work if they had adequate re-skilling.

The American Staffing Association’s staffing index rose to a reading of 94 in the week of Jan. 8 to Jan. 14, reaching the second-highest value for the same week since the inception of the ASA Staffing Index in 2006.

IT job growth in the US grew by 0.3% sequentially in December to more than 5.3 million; on a year-over-year basis. The increase was 1.5%, according to the TechServe Alliance. Engineering employment increased by 0.07% sequentially in December to almost 2.6 million jobs. The increase was 1.5% on a year-over-year basis.

The economy – Outside North America

Global unemployment in 2018 is projected to remain at a similar level to last year according to a new report by the International Labour Organization (ILO). The World Employment and Social Outlook: Trends 2018 showed that the global unemployment rate has been stabilizing after a rise in 2016. It’s expected to have reached 5.6% in 2017, with the total number of unemployed exceeding 192 million people.

More than half of the businesses in the UK (51%) are looking to grow their workforces over the next 12 months, according to a survey from the Confederation of British Industry and Pertemps Network Group.

Only 28% of UK managers expect the economy to grow, according to a survey of 1,037 managers surveyed by the Chartered Management Institute. Optimism is the lowest in four years and down from 63% in 2014.

The Malaysian Employers Federation announced that 2018 would be a challenging year for its employment outlook, as over 50,000 workers will lose their jobs during the year. Malaysia’s unemployment rate stood at 3.4% in October, according to figures from Statistics Malaysia.

The seasonally adjusted jobless rate in Taiwan stood at 3.69% in November, same as October, according to data from the Directorate General of Budget Accounting and Statistics.

As the overall economy continued to grow steadily in China, the demand for labour kept increasing in the fourth quarter of 2017. However, the labour supply declined in the slow season for job seekers, according to the latest CIER Employment Index Report for the fourth quarter of 2017.

More than 400,000 jobs in Northern Ireland are at risk because of an increase in automation over the next ten years, reports BBC News with data from the Ulster University’s Economic Policy Centre and Catalyst Inc. The figure accounts for 50% of the total number of jobs in Northern Ireland. Of the sectors most likely to be affected by automation, the manufacturing sector was found to be the most vulnerable.

New Zealanders became more confident about job opportunities in the December quarter, though most people aren’t expecting a pay rise this year, according to the latest Westpac McDermott Miller employment confidence Index. The index rose 0.1 points to 113.9 in the fourth quarter, the highest level in a decade, with the present conditions index up 2.2 points to 117.9, while the employment expectations index dropped 1.4 points to 111.2.

December saw a 37% decrease in jobs available in London, when compared to last year, according to the latest Morgan McKinley Employment Monitor. The Monitor also showed that the number of professionals seeking jobs fell by 30%, year-on-year.

Most employers within the Gulf Cooperation Council countries plan to recruit additional staff in the next 12 months, according to Hays 2018 GCC Salary & Employment Report.


The uncovering of two major flaws in computer chips, Meltdown and Spectre, were initially thought to be an Intel issue, but is now known to affect AMD and ARM processors too. There is a lot of scrambling to fix these hardware bugs and more to come on this story.

Amazon‘s search for allocation to put its second headquarters continues. The winning city could get up to 50,000 high-paying jobs and $5 billion in investment, figures that Amazon has dangled in front of local officials, setting off an unprecedented competition to be the second home for one of the internet’s mightiest companies. In all, 238 cities and regions applied to bring the company to town, many using promises of tax breaks and public charm offensives to gain favor with the e-commerce giant. That list is now down to 20 finalists – to be continued!


Veeam Acquires N2WS in Play for AWS Cloud-Native Data Protection

Data protection software developer Veeam has made its first acquisition in a deal that will bring it native Amazon Web Services cloud data protection. On Tuesday, Veeam unveiled the acquisition of N2WS, a small developer of data protection and disaster recovery offerings with native AWS cloud capabilities. N2WS, based in West Palm Beach, Fla., with its primary development done in Haifa, Israel, said it is the largest provider of data protection AWS environments.

SS&C to Purchase DST Systems for $5.4 billion

SS&C Technology Holdings has reached an agreement to acquire DST Systems in a deal worth more than $5 billion. Windsor, Conn.-based SS&C specializes in investment management software and services. Buying DST would bolster its financial software prowess and, perhaps more notably, add a trio of health-care-focused solutions to the company’s portfolio. The deal would create a $3.9 billion solution provider powerhouse with more than 13,000 clients combined; DST reported pro forma revenue of $2.3 billion for the 12 months preceding Sept. 30 of last year. DST Systems’ offerings include banking, investor, brokerage, adviser, wealth management and insurance solutions on the financial side of the house as well as administration, pharmacy and health outcome optimization solutions on the health-care side. The company employs more than 14,000 globally and has a particularly strong presence in the U.S. retirement and wealth management markets.

ADP Buys WorkMarket

Human resources giant ADP expanded its payroll and labour management portfolio with the purchase of WorkMarket, a cloud-based workforce management provider.
WorkMarket, based in New York, holds particular expertise when it comes to managing independent contractors and consultants, and many of its customers are top solution providers such as Dimension Data, High Wire Networks and Presidio. Through its platform, the software vendor allows companies to build pools of skilled technical labour that can be deployed on demand, track their engagements and evaluate their performance.

AWS Buys Sqrrl

Amazon Web Services has given its new threat detection service a shot in the arm by purchasing cybersecurity software company Sqrrl. Cambridge, Mass.-based Sqrrl’s advanced threat hunting capabilities are expected to align well with Amazon GuardDuty, an intelligent threat detection service Amazon launched in November focused on protecting AWS accounts and workloads. Terms of the deal were not disclosed, though Axios reported in December that the purchase price was expected to be just over $40 million.

TD Bank Buys AI Firm Layer 6

TD Bank Group’s digital transformation strategy has led to the acquisition of Toronto-based artificial intelligence (AI) firm Layer 6. The intent is to add personalized and real-time advice to the bank’s existing AI capabilities. Layer 6 was launched in Toronto in late 2016. Its signature platform provides enterprises in sectors such as the e-commerce and financial industries with improved deep learning and personalization capabilities. It also helped found the Toronto-based incubator Vector Institute, which is trying to commercialize AI research, and has received funding from the Royal Bank of Canada and Google.


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