News and Analysis to 10^th February 2005

Carly’s Fiorina’d

The writing was on the wall for Hewlett Packard’s CEO Carly Fiorina.  Speaking at the Davos World Summit she predicted a cautious return to spending, which sounded odd given the record breaking figures coming in from most of HP’s peers. A recent abrupt departure from the HP board suggested that something was brewing. Well now Carly has been shown the door; the implicit message being that the acquisition of Compaq has not worked. Perhaps the road is now clear to take the advice of many analysts and spin HP off into two separate businesses (consumer and enterprise).

Vodafone Bills Japan again

Vodafone has taken its eye off the 3G ball in Japan. It has slid well behind local rivals NTT Docomo and KDDI. To address this they have dispatched UK CEO Bill Morrow, who has supported the Japanese operation in the past.  Mr Morrow’s movement has triggered the movement of Tim Miles MD of Vodafone New Zealand into the empty seat in the UK. This global ‘musical chairs’ could suggest that the wireless giant lacks depth in its senior management talent-base.

Sun-powered future

Sun Microsystems’s strategy this week is utility computing. It has a vision where computing power is purchased on-demand from the likes of, er, Sun. To help this vision unfold, Sun plans to create an exchange where users can buy processing power at the going market rate. Investors, brace yourselves for computer processor futures, options and other exotic ‘digital power’ financial instruments.

Microsoft sole searching

Software giant Microsoft has dropped Yahoo! in favour of its newly developed (in-house) search engine. It’s now time to play catch up with both Yahoo! and Google. Fancy features include search by geography and the ability to specifically query Encarta, Microsoft’s online encyclopaedia.

China no threat to India

According to a study by management consultants McKinsey & Co, India should feel under no threat from China’s IT services industry for some years. Whilst China’s English speaking graduate population is growing at an impressive rate, doubling to 24 million over the last four years, its fragmented IT industry will make it very difficult to pick up the ‘big-ticket’ off-shoring opportunities. China has circa 8,000 software providers, of which 75% have less than 50 staff and only five have more than 2,000.

CA sells governance

Computer Associates, which knows a thing or two about corporate governance, has signed a reseller deal with Niku Corp, whose IT project management software is being positioned as an IT governance tool. It might even provide a ‘golden thread’ that makes it easier for Computer Associates to sell its random array of acquired software products as a coherent solution suite.

EDS – Back in black

Possibly the tide is turning for beleaguered IT services company EDS, which posted a Q4 net income of $53m. CEO Michael Jordan was quick to douse any uplifting sensations by warning the analysts of an upcoming ‘below par year’. Of significance is the fact that its troubled contract with the US Navy over the last two years is about to generate a profit. By contrast Fujitsu has just got out the red pen for its Q3 results.

Microsoft – Antivirus aggregator

Microsoft has bolstered its antivirus credentials by acquiring Sybari Software, a maker of server-side antivirus and spam solutions. The news caused Symantec and McAfee’s share prices to head south. Unusually Sybari does not create its own virus definition files, but in effect provides a framework for customers that want to use multiple anti-virus packages simultaneously. This is good news for Microsoft’s rivals in this space as it is not ‘locking them out’. But it does put the software giant in an influential position if it owns the de facto anti-virus platform.

IBM – hard cell approach

IBM and pals, Sony and Toshiba, have just announced details of their forthcoming ‘Cell processor’. This high-powered computer chip will eventually find its way into next generation televisions, gaming consoles and may even become a threat to Intel in the PC marketplace.

Data wherehouses?

Research firm Gartner announced at its recent Business Intelligence (BI) Summit that CIOs across the world expect to increase their spend on BI related projects by 6% in 2005. This area has grown steadily even through the technology dark ages (2001-2003 AD). Gartner points out that many IT departments however are excitedly building data warehouses without actually involving the users. Thus the data warehouse is full of data the IT department thinks would be useful to the business rather than what the business actually needs. Though in fairness the business community needs to raise its game and engage more closely with the IT community.