Large IT companies are running into some M&A trouble. Verizon wants a discount on their Yahoo acquisition, Saleforce is trying to block the Microsoft’s purchase of Linkedin, and Oracle is struggling to make their purchase of Netsuite a reality.
Cloud was a big topic this week – Google has officially rebranded their cloud offerings as “Google Cloud” due to customer confusion (good move), IBM CEO Ginni Rometty explains her company’s position on blockchain (and discusses if AI can replace her), and VMWare is available on AWS.
HP Inc is cutting 4,000 jobs but former EMC CEO Joe Tucci found one!
Acquisitions
- Verizon wants $1 billion discount after Yahoo privacy concerns
“The key will be what was actually disclosed by Yahoo before signing,” Frank Aquila, legendary M&A lawyer and partner at Sullivan & Cromwell tells TechCrunch. “No one should be surprised that Verizon wants a significant reduction.”
- It looks like Marc Benioff does have reason to worry about the LinkedIn-Microsoft deal
Salesforce has been complaining to the European Commission about Microsoft’s purchase of LinkedIn. It is worried that Microsoft will block access to LinkedIn’s vast store of professional data and it wants the EU to either block the acquisition (unlikely) or put conditions on the deal (unlikely but more plausible).
- Salesforce CEO Benioff’s decision to walk away from Twitter is the right one
Investors breathed a sigh of relief but were probably also thinking, “told you so.” After the initial reports of Benioff’s interest in Twitter last month, the deal was panned by almost everyone, from Wall Street analysts to the media to Salesforces’s biggest investors. Salesforce stock is up 6% on the news.
- Oracle Wins Injunction, Extends Final Tender Offer for Netsuite
Meanwhile, Oracle recently extended the expiration date of its tender offer for NetSuite acquisition to Nov 4. The company stated that this is the final extension and “In the event that a majority of NetSuite’s unaffiliated shareholders do not tender sufficient shares to reach the minimum tender condition, Oracle will respect the will of NetSuite’s unaffiliated shareholders and terminate its proposed acquisition.”
Artificial Intelligence
- Could Watson Replace Ginni Rometty? What She’s Not Saying About AI, Jobs & Disruption
IBM has bet it’s future on AI, cloud computing and data/information/knowledge management. All three areas are about reducing costs and improving productivity by decreasing human labor.Cloud computing, for example, could easily be described as the technology delivery model that kills software developers, applications support professionals and data center managers. There’s a straight line from the number of jobs IBM eliminates and its stock price. If Watsonbecomes a friendly assistant that charges for its pedantic services, IBM will fail. But if Watson enables large-scale labor replacement, IBM’s stock will rise.
- Artificial intelligence positioned to be a game-changer (follow link for the video)
One of the technologies just hatched is called Gabriel. It uses Google Glass to gather data about your surroundings and advises you how to react. It’s like an angel on your shoulder whispering advice or instructions. In this case trying to direct us how to win a game of ping pong but the possibilities go beyond bragging rights.
http://www.cbsnews.com/news/60-minutes-artificial-intelligence-charlie-rose-robot-sofia/
Cloud
- IBM wins $62 million contract to run private cloud pilot at Army’s Redstone Arsenal
IBM won the work as a task order under the Army’s Private Cloud II indefinite delivery/indefinite quantity contract. The $62 million award includes one base year and four option years, during which the company will build, then own and operate a data center on Army property at Redstone Arsenal, near Huntsville, Alabama.
- VMware and AWS Announce New Hybrid Cloud Service, “VMware Cloud on AWS”
Amazon and VMWare today announced a strategic alliance to build and deliver a seamlessly integrated hybrid offering that will give customers the full software-defined data center (SDDC) experience from the leader in the private cloud, running on the world’s most popular, trusted, and robust public cloud. VMware Cloud™ on AWS will enable customers to run applications across VMware vSphere®-based private, public, and hybrid cloud environments. Delivered, sold, and supported by VMware as an on-demand, elastically scalable service, VMware Cloud on AWS will allow VMware customers to use their existing VMware software and tools to leverage AWS’s global footprint and breadth of services, including storage, databases, analytics, and more
- IBM CEO Rometty’s position on blockchain
Good to hear IBM’s direct stance on the platform and what their vision is - IBM’s Cleversafe storage platform is becoming a cloud service
Cleversafe’s innovation in object storage was to combine encryption with erasure coding and geographic dispersal of data. SecureSlice encrypts unstructured data, stores the key with the data, and then breaks up that data and puts it on several different storage nodes. In IBM Cloud Object Storage, those nodes can be in data centers spread across an entire continent.
- Google’s Diane Greene providing a status on Google’s cloud platform:
- IBM says its new Cloud Object Storage allows easily moving and splitting data
The service is built on technology dubbed SecureSlice, which combines encryption, erasure coding and geographic dispersal of data. Erasure coding is a form of data protection. IBM acquired the SecureSlice technology when it bought Cleversafe last year for $1.3 billion. The technology automatically encrypts each segment of data before it’s erasure-coded and dispersed, and the data can only be reassembled where it was originally received.
http://www.geekwire.com/2016/ibm-says-new-cloud-object-storage-allows-easily-moving-splitting-data/
- Amazon cloud boss Andy Jassy fires back at Oracle’s Larry Ellison, says stats were ‘made up’
Instead, Jassy pointed to what analysts are saying about AWS. For example, Gartner said in its Magic Quadrant report last year that AWS is 10-times bigger than its next 14 competitors combined, while putting it at the top of the list against this year.
Deutsche Bank also wrote in a recent note, “Oracle talked up its ‘next-gen’ infrastructure as a cheaper rival to AWS, but we don’t believe it will be competitive anytime soon.
Datacenter
- IBM, Google, others to unveil new open interface to take on Intel
The new standard, called Open Coherent Accelerator Processor Interface (OpenCAPI), is an open forum to provide a high bandwidth, low latency open interface design specification.
The open interface will help corporate and cloud data centers to speed up big data, machine learning, analytics and other emerging workloads.
The consortium plans to make the OpenCAPI specification available to the public before the end of the year and expects servers and related products based on the new standard in the second half of 2017, it said in a statement.
http://www.reuters.com/article/us-technology-consortium-idUSKCN12E0C5
- Dell shows off new logo…
This looks like something Silicon Valley would do to make fun of an IT company.
Other
- Joe Tucci Named Chairman of Bridge Growth Partners
Bridge Growth Partners, LLC, a sector-focused, growth-oriented private equity firm, today announced that Joseph M. Tucci, former Chairman and Chief Executive Officer of EMC Corporation and former Chairman of VMWare, has been named Chairman of the firm. Tucci has served on the firm’s Investment Committee and Advisory Board since Bridge Growth Partners was established in late 2013.
- Hewlett Packard Enterprise will have approximately $9 billion in net cash at the end of FY17
Hewlett Packard Enterprise is expected to host analyst meeting event on October 18, and according to Mr. Hosseini, the management will surely divulge information regarding the high level of cash in the company’s balance sheet. Furthermore, the analyst expects insight regarding growth initiatives and the strategy used by the company in order to promote secular growth trends in key areas of business.
- HP Inc will cut up to 4,000 jobs by 2019
The world’s second-largest PC supplier has struggled in a dwindling market, and hopes the cutbacks will save the company between $200 to $300 million annually by 2020.
However, HP will also incur an estimated $350 million to $500 million in restructuring costs.
The announcement comes during a global decline in PC sales, dropping 5.7% in the third quarter compared to last year according to a report by Gartner. This represents the longest period of decline in the history of the PC industry.
http://www.itpro.co.uk/strategy/27410/hp-will-cut-up-to-4000-jobs-by-2019
Photo: Tao Wen