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Acquisitions abound

The global ICT market was dominated by several acquisitions, including significant ones by Adobe, Oracle and Cisco.

Read time 13min 10sec

Welcome to my first column of 2013. As seems to be the norm over the year-end holiday season, the international ICT market was dominated by numerous acquisitions, including significant ones by Adobe, Arris Group (>$2 billion), Cisco, Dell, EMC, Elliott Management (>$2 billion), IBM, Iron Mountain (several), Microsoft and Oracle (two); and the restructuring announcement from EMC.

At home, the ongoing Net 1 UEPS saga stole much of the local ICT media space.

Key local news of the past six weeks

* Satisfactory year-end figures from Muvoni Technology Group, with revenue up 6.4% and back in the black.
* Very poor year-end numbers from Telemasters, with revenue down 36.1% and profit down 97.7%.
* A negative trading update from Datatec.
* The suspension of the trading of Zaptronix's shares, following its failure to comply with the JSE's listing requirements.
* Adcorp acquired Paxus, an Australian IT contracting and recruitment services company, for R545 million.
* Datacentrix bought Nokusa Engineering, a consulting company, for R45.75 million.
* Pinnacle purchased JAG Engineering (90%), a manufacturer of server racking, wall boxes and IP enclosures.
* FoneWorx and the Value+ Nettwork group of companies, which is mainly owned by the Kirsh family trusts, formed a R191 million merger.
* Communications minister Dina Pule has appointed 22 people, including Pieter Uys, ex-CEO of Vodacom, to advise her department as it prepares to overhaul the legislation that governs SA's ICT sector.
* Net 1 UEPS Technologies is being probed by the US government regarding possible violations of its Foreign Corrupt Practices Act.
* Net 1 UEPS Technologies has commenced a lawsuit against AllPay Consolidated Investment Holdings, which was allegedly responsible for the US probe that is under way.
* A new JSE cautionary by Datacentrix.
* Renewed JSE cautionaries by Altech, FoneWorx, Morvest Business Group and TCS.
* A withdrawn JSE cautionary by Muvoni Technology Group.
* The appointments of Jacques du Toit as CEO of Vox Telecom; Murray Louw as non-executive chairman of Prescient; Herman Stein as CEO of Prescient; and Servaas Venter as EMC country manager Southern Africa.
* The resignations of Angus MacRobert, co-CEO of Vox Telecom; and Doug Reed, co-CEO of Vox Telecom.

Key African news

* Econet Wireless invested in TN Bank (Zimbabwe), in a deal that raises its stake to 100%.
* Viettel Cameroon Sarl, the local unit of Viettel (Vietnam), made a $393.9 million investment in the country's telecommunications industry.
* The Africa Coast to Europe (ACE) consortium said the first phase of the ACE submarine cable is now operational, and links France with Sao Tom'e & Principe.
* Libya's third undersea cable has gone live. It runs from Libya to Greece.
* The launch of a new telecommunications company in Uganda, Suretelcom at Kibuli, a subsidiary of Timeturns Holding, an international telecommunications company.
* Nokia Siemens Networks has combined its Africa and Middle East operations.
* Tanzania has started to switch off analogue broadcasting, following the start of its digital broadcasting systems.
* Orange has launched its operations in the DRC.
* Rig Communications (Ghana) intends to build a $100 million technology centre in that country.
* The appointments of Chipo Mutasa as MD of TelOne (Zimbabwe); and James Myers as non-executive chairman of Econet Wireless Zimbabwe.
* The resignation of Tawanda Nyambirai, chairman of Econet Wireless Zimbabwe.

Key international news

* Adobe acquired Behance, an online social media platform.
* The Arris Group bought Google's (Motorola Home) TV set-top business for $2.35 billion.
* Atmel purchased Ozmo, a WiFi solutions company.
* Avnet acquired TSSLink, an IT professional services organisation, and also the assets of USI Electronics, a distributor of discrete semiconductor, passive and electromechanical components.
* Berkshire Partners bought two fibre-optic network providers, ie, Lightower Fiber Networks and Sidera Networks. It will merge the two entities. The deal was worth over $2 billion.
* Cisco purchased BroadHop, a provider of network management products used by service providers.
* Citec Telecom acquired C&W and Portugal Telecom's stake in Macau Telecom for $1.2 billion.
* Citrix Systems bought Zenprise, a mobile device management software company.
* Cognizant Technology Solutions purchased six companies of the C1 Group, an independent consulting and IT services firm.
* Dell acquired Credant Technologies, a supplier of data protection solutions to control, manage and secure data sent from endpoints to servers, storage and the cloud.
* Dropbox bought Audiogalaxy, a music streaming service provider.
* Elliott Management purchased Compuware for $2.3 billion.
* EMC acquired iWave Software, a storage and cloud automation software developer.
* EMC will merge its data analytics and cloud application assets into a new group called Pivotal Initiative.
* Equifax bought the Credit Services business of CSC for $1 billion.
* France Telecom purchased Simyo, a Spanish MVNO, from KPN NV.
* Groupon acquired CommerceInterface, an online retail manager.
* Hutchison (Hong Kong) bought Orange Austria for EUR1.3 billion.
* IBM purchased StoredIQ, a software company that will help the former derive value from big data and respond more efficiently to litigation and regulations, dispose of information that has outlived its purpose, and lower data storage costs.
* Intellectual Ventures and RPX acquired Kodak's digital imaging patents, a move that should allow the latter to exit Chapter 11, for $525 million.
* Iron Mountain bought IG2 Data Security, DATAPROS Storage & Staffing, and Data Backup, three data storage companies.
* Juniper Networks purchased Contrail, a soft-networking start-up, for $180 million.
* Marlin Equity Partners acquired the optical network business of Nokia Siemens Network.
* Microsoft bought id8 Group R2 Studios, home entertainment start-up.
* NCR purchased uGenius Technology, a pioneer in video banking software.
* Oracle acquired DataRaker, a provider of a cloud-based analytics platform that enables utilities to leverage vast amounts of data to optimise operational efficiency and improve the customer experience; and it bought Eloqua, a maker of marketing automation software, for $810 million.
* Red Hat purchased ManageIQ, a provider of enterprise cloud management and automation solutions.
* Sprint Nextel acquired the remaining shares of Clearwire it doesn't already own, for $2.2 billion.
* Synchronoss Technologies bought RIM's cloud services unit, NewBay, for $55.5 million.
* Yahoo purchased OnTheAir, a video chat start-up.
* BT Group disposed of its remaining stake in Tech Mahindra for $183 million.
* The following patent and lawsuit activity:
* Apple has violated three patents owned by MobileMedia.
* Apple lost a copyright lawsuit regarding its App Store, in China.
* Apple's injunction bid against Samsung was rejected.
* Nokia has settled a patent dispute with RIM, which will now make a one-off payment to the former, which will in turn drop all litigation regarding the matter.
* Samsung has withdrawn its lawsuits against Apple in Europe.
* Wi-Lan, a patent licensing company, is suing RIM for allegedly infringing a patent that relates to Bluetooth technology. This is in addition to the one also initiated against Apple, HTC and Sierra Wireless over LTE mobile technology.
* There was an initial rejection by the US Patent & Trademark Officer of Apple's 'pinch-to-zoom' patent.
* A Californian judge refused a retrial in the Apple vs Samsung trial, and Apple's request for the banning of 26 Samsung devices.
* The EU made a charge that Samsung has abused its dominant position in seeking to bar Apple from using a patent deemed essential to mobile phone use.
* Google has dropped two patent claims against Microsoft, leaving one.
* The Marvell Technology Group has been fined $1.17 billion following a patent verdict loss against Carnegie Mellon University.
* Facebook has joined the Nasdaq-100 index in place of Infosys, which is moving its listing to the NYSE; this is a totally separate move to the annual reshuffle that takes place around this time.
* Garmin is to replace RR Donnelley, an integrated communications services provider in the S&P 500 index.
* The European Union will review Microsoft's new terms of use agreement.
* The EU has imposed a $1.92 billion cartel fine on six firms for running two price-fixing cartels regarding TV and computer monitor CRTs. The companies include LG Electronics, Philips and Panasonic.
* Kodak has raised enough cash for it to exit Chapter 11, assuming it can sell its digital patents for at least $500 million.
* Hitachi will cease production of chips by 2014.
* The US Federal Trade Commission won't bring charges against Google, following its 19-month probe into the company.
* Yahoo has been hit with a $2.7 billion fine for damages by a Mexican court regarding a contract dispute with its former partners on a directories business.
* Satisfactory quarterly results from Accenture, Adobe, Infosys, Oracle and Shaw Communications.
* Mediocre quarterly results from Synnex.
* Mixed quarterly figures from Jabil Circuit, with revenue up but profit down; Progress Software, with revenue down but profit up; Red Hat, with revenue up but profit down; and VeriFone, with revenue up but profit down.
* Very poor quarterly figures from HTC and RIM, with revenue also down substantially for both companies.
* Quarterly losses from Ciena, Micron Technology and Palo Alto.
* The appointments of Bracken Darrell as CEO of Logitech International; Scott Di Valerio as CEO of Coinstar; Michael Gregoire (ex-CEO of Taleo) as CEO of CA Technologies; Emmanuel Hernandez as chairman of MEMC Electronic Materials; Timotheus H"ottges as CEO of Deutsche Telekom (as of 1 January 2014); Richard Howe as CEO of Inuvo; Blake Irving (ex-Yahoo executive) as CEO of Go Daddy; Marc Lautenbach as president and CEO of Pitney Bowes; Tom Leighton as CEO of Akamai Technologies; Lee Jae-yong (son of the chairman) as vice-chairman of Samsung Electronics; Phil Pead as CEO of Progress Software; Clifton Pemble as CEO of Garmin; Steven Shindler as interim CEO of NII Holdings; and Tony Wen-hsin as chairman of Foxconn International.
* The resignations of Dave Bell, president and CEO of Intersil; Guerrino De Luca, CEO of Logitech International (stays on as chairman); Steven Dussek, CEO of NII Holdings; Min Kao, CEO and co-founder of Garmin (stays on as executive chairman); Jason Kilar, CEO of Hulu; Anders Narvinger, chairman of TeliaSonera; and Ren'e Obermann, CEO of Deutsche Telekom (as of 31 December 2013).
* The retirements of Samuel Chin, chairman of Foxconn International; and Paul Davis, CEO of Coinstar.
* The death of Norman Woodward, the co-inventor of the bar code.
* A planned IPO in Iraq this month from Asiacell, a mobile operator in that country.
* Planned IPOs by FireEye, a cyber security firm, and Tableau Software, a business analytics software provider.
* A satisfactory IPO on London's Aim market by Fusionex, a Malaysian software company.
* A good IPO in India by Bharti Airtel's mobile tower company, Bharti Infratel.

Net 1 UEPS Technologies is being probed by the US government.

In the annual shuffle of the Nasdaq-100 index, Analog Devices, Equinix, Liberty Global, SBA Communications, Verisk Analytics and Western Digital have now been included, although Flextronics International, LAM Research, Marvell Technology Group, Netflix, RIM and VeriSign have been dropped; nevertheless, overall, this is a strengthening of the ICT component of this index.

Look out for

* International:
* The possible closure of the services unit of Nokia Siemens Network.
* The listing of Telefonica's Latin American operations.
* The buyer for Cisco's Linksys consumer networking division.
* The possible investment by Cisco in WhipTail, a data storage company.
* The winner between Carlyle Group and KKR in the race for Reynolds and Reynolds, the provider of business management software for auto dealers.
* The outcome of Dish Networks' $5.5 billion bid for Clearwire, which has already accepted a bid from Sprint Nextel.
* Africa:
* The possible investment in Maroc Telecom by KT, following its failure to secure a stake in Telkom SA.
* The sell-off by Telecom Egypt of its stake in Vodafone Egypt.
* Vodacom's bid for Zambia's fourh mobile licence.
* South Africa:
* A possible bid by Bharti Airtel for Cell C or 8ta.

Research results and predictions

* Worldwide IT spending will reach $3.7 trillion in 2013, a 4.2% increase from 2012, according to Gartner.
* The worldwide external controller-based disk storage market grew 3.6% in Q3 2012 to $5.3 billion, with NetApp and HDS closing the gap on IBM for the number two position behind EMC, says Gartner.
* Worldwide semiconductor sales are forecasted to reach $311 billion in 2013, a 4.5% increase over last year, predicts Gartner.
* By 2015, one-third of consumer brands will integrate payment into their branded mobile applications, according to Gartner.
* The IDC forecasts tablet shipments of 172.4 million units in 2013, up from 112.3 million in 2012.
* The EMEA unified communications and collaboration market is expected to reach $11.7 billion by 2016, up from $6.9 billion in 2011, according to IDC.
* Android phones will account for 70% of global smartphone shipments in 2013, according to Digitimes Research.
* Revenue generated by telecommunications operators surpassed $2 trillion in 2012 and are only expected to grow 2% this year, says Ovum.
* In 2012, Samsung deposed Nokia as the largest vendor of cellphones, a place the latter had held for many years, according to HIS.
* The worldwide forecast for IT spend in 2013 will be 5.4% higher than for 2012, states Forrester Research.
* Worldwide PC shipments in Q4 were down 6.4% to 89.8 million units, with HP retaining the number one slot but Lenovo closing in quickly, according to IDC. Acer had the largest drop in market share.

Stock market changes

* JSE All share index: Up 5.7% (highest-ever weekend close)
* Nasdaq: Up 3.8%
* Top SA share movements: Blue Label Telecoms (+19.5%), Gijima (+33.3%), Huge Group (-20%), Labat Africa (-45%), Muvoni (+16.7%), Net 1 UEPS Technologies (-36.9%), SecureData (-48%), Stella Vista (+200%), TCS (-50%) and Telemasters (-18.9%)

Final word

CIO magazine has published seven technology trends that will impact business in 2013. They are:

* Hospitals will move to embrace BYOD;
* 3D printing will mature;
* Passwords will fade into oblivion, with biometrics taking over;
* TV will go Apptastic, ie, the 'appification' of TVs;
* Classrooms will go online in a big way;
* Design will become less ornamental; and
* Internet outages will cause systemic problems.

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