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Google aims to get into shape with Fitbit

Google has bid $2.1 billion for Fitbit, the wearable device maker.
Read time 9min 30sec

Google owner Alphabet’s bid for Fitbit and the continuing regulatory reactions/investigations regarding the big tech boys dominated the international ICT market last week.

At home, issues regarding 4Sight Holdings and Cell C continued to have prominence.

Key local news

  • Good interim numbers from MiX Telematics, with revenue up 11.2% and profit up 61.6%.
  • A positive trading update from MTN.
  • SBA Communications acquired Atlas Tower’s South African tower portfolio for R2 billion.
  • Bluekey Seidor has changed its name to the Seidor Africa Group of Companies.
  • Trading of the shares of 4Sight Holdings has been suspended.
  • ICASA has published the long-awaited information memorandum on the licensing process for the assignment of the International Mobile Telecommunications spectrum, or what is also referred to as high-demand spectrum, which will also enable local mobile operators to deploy 5G technology.
  • A renewed JSE cautionary by Blue Label Telecoms.
  • The appointments of Rochelle Ponen as hardware product manager of Kyocera Document Solutions SA; and Tertius Zitzke as acting CEO of 4Sight Holdings.

Key African news

  • Satisfactory half-year figures from Safaricom, with revenue up 5% and net income up 14%.
  • Good nine-month figures from MTN Ghana, with services revenue up 22.7% and EBITDA up 63%.
  • Good nine-month figures from MTN Nigeria, with services revenue up 12.1% and EBITDA up 39.3%.
  • The appointment of Eddy Mabano Kayihura as CEO of the African Network Information Centre (AFRINIC), a pan-African Internet registry.

Key international news

  • Accenture acquired Bow & Arrow, a UK-based digital ventures consultancy that helps clients identify and create new digital products and services that fulfil unmet customer needs.
  • AVX bought Chengdu OK New Energy, a supercapacitors developer and manufacturer.
  • Clayton, Dubilier & Rice purchased Anixter International, a global distributor of network and security solutions, electrical and electronic solutions and utility power solutions, has entered into a definitive agreement with an affiliate of Clayton, Dubilier & Rice to be acquired in an all cash transaction valued at $3.8 billion.
  • Confluence Technologies, a US-based creator of software used to manage investment data, acquired UK-based StatPro Group, a portfolio analytics software provider, for £161.1 million.

Apple faces more regulatory woes in Europe.

  • ConnectWise bought Continuum, another MSP (both are owned by private equity juggernaut Thoma Bravo); and ITBoost, maker of a documentation tool that standardises a solution provider’s customer information across the business.
  • US data centre specialist firm Digital Realty is proposing a takeover of Dutch colocation provider Interxion, one of Europe’s biggest data centre operators, for $8.4 billion.
  • Fortinet acquired enSilo, a privately held advanced endpoint security company.
  • Google has bid $2.1 billion for Fitbit, the wearable device maker.
  • Hytera purchased EMCORE’s Cable TV production equipment and manufacturing operations.
  • J-STAR, a mid-market player in the Japanese private equity market, acquired content creation firm Kurashino, lifestyle media publisher 1k and user behaviour analyst CRAFTA, which it will combine into a single platform.
  • Lantronix has offered to acquire Intrinsyc Technologies, a provider of solutions for the development of embedded and Internet of things products.
  • Livingstone Technologies, a provider of software management and consulting services owned by The Carlyle Group, has agreed to acquire Cloud Optics, a UK-based provider of cloud and software licence and consulting services for a range of vendors.
  • Navint Partners, a consulting and technology company, acquired Statera, a company that helps businesses implement Salesforce to drive revenue.
  • Siemens bought Intel-backed start-up Pixeom’s edge computing platform, a move that will help the German industrial giant embrace container technology to make it easier to run edge applications in factories. The deal includes Pixeom's assets and employees, but not the business itself.
  • Smartspace Software, a provider of integrated space management software, purchased Space Connect, its Australian peer.
  • Tech Data acquired DLT Solutions, a government solutions aggregator.
  • TTEC Holdings, a digital global customer experience technology and services company, bought FCR, a US-based digitally enabled customer experience provider focused on the direct to consumer, e-commerce and hypergrowth markets.
  • Tyler Technologies purchased Courthouse Technologies, a provider of jury management systems.
  • Tencent led a $110.8 million investment in MX Player, a popular video app that offers both local playback and streaming services.
  • Sberbank invested in Mail.ru, a Russian Internet company.
  • Tritium Partners invested in AutoVitals, a provider of software for the automotive repair industry.
  • TSMC and GlobalFoundries have settled their patent dispute.
  • Alphabet’s Google is being taken to court by an Australian regulator that alleges the Internet giant misled customers about how it collected and used personal location data.
  • Apple faces more regulatory woes in Europe, as EU antitrust regulators ask online sales companies whether they have been told to use the former’s mobile payment service instead of rival services.
  • Atos has sold part of its minority stake in Worldline.
  • Facebook has agreed to pay a £500 000 fine for breaches of data protection law related to the harvesting of data by consultancy Cambridge Analytica, as prescribed by Britain's information rights regulator.
  • Reliance Industries (India) is set to spin off its mobile network division, Reliance Jio, and invest over 1 trillion rupees ($15 billion) to allow the company to accelerate growth.
  • Excellent quarterly results from L3Harris Technologies.
  • Very good quarterly figures from Alibaba, Paycom Software, Spotify and Zynga.
  • Good quarterly numbers from Acacia Communications, Aspen Technology, Booz Allen Hamilton, CDW, CRA International, CSG Systems International, Facebook, Fortinet, Garmin, Inovalon (back in the black), Leidos, Mastercard, Mellanox, Mercury Systems, NeoPhotonics (back in the black), SB Technology, SolarWinds, SS&C Technologies, Universal Display, Viavi (back in the black) and Winbond.
  • Satisfactory quarterly results from ADP, AMC Networks, AMD, American Tower, Anixter International, Arista Networks, AudioCodes, Akamai, BCE, Cardtronics, Cognizant, Dynamic Electronics (back in the black), EA, Elite Material, FormFactor, Gartner, Iron Mountain, j2 Global, Lattice Semiconductor, Lumentum, Maxim Integrated Products, Motorola Solutions, Open Text, Orange, PC Connection, Sanmina, SBA Communications, T-Mobile US, Tyler Technologies, WideOpenWest and Zebra Technologies.
  • Mediocre quarterly results from Amkor Technology, Arrow Electronics, AT&T, AVX, Axcelis Technologies, Canon, Chunghwa Telecom, Cognex, Corning, InterDigital, IPG Photonics, Key Tronic, KKR, MicroStrategy, NXP Semiconductor, Rogers, Samsung Electronics, Seagate, Sensata Technologies, Sharp, Shenandoah Telecommunications, TE Connectivity, Tessco Technologies, TTM Technologies and Vishay Intertechnology.
  • Mediocre half-year figures from Ubisoft.
  • Mixed quarterly figures from Allied Motion Technologies, Alphabet, Apple, ASE Technology Holding, CACI International, Check Point Software Technologies, Digital Reality, Equinix, Flir Systems, Global Payments, KLA, Novoton Technology, Qualys, Rovio, Sabre, Silicon Motion, Sirius XM, TDS, United Microelectronics, US Cellular, Verisk Analytics and ZTE, with revenue up but net income down; and from A10 Networks (back in the black), Consolidated Communications (back in the black), Eaton, Qorvo, Sony, Trimble and Xerox, with revenue down but net income up.
  • Mixed half-year figures from Nintendo, with revenue up but net income down; and from BT Group, with revenue down but net income up.
  • Quarterly losses from 3D Systems, 8x8, Adtran, Alteryx, Appian, AU Optronics, AXT, Belden, Casa Systems, Commvault Systems, Cree, Diebold Nixdorf, Digimarc, Dynatrace, Extreme Networks, FARO Technologies, FireEye, Inphi, Intelsat, Iridium Communications, Lyft, MobileIron, NetScout, O2Micro International, ON Semiconductor, Orbcomm, PDF Solutions, Pinterest, Pixelworks, Pluralsight, Powerbridge Technologies, Quad Graphics, RealNetworks, Shopify, Sonim Technologies, Tenable, Twilio, Unisys, Varonis Systems, Western Digital, Zendesk and Zix.
  • A half-year loss from Smartspace Software.
  • The appointments of Charles Goodman as interim CEO of Imperva; Ron Nersesian as chairman of Keysight Technologies (already CEO); and Robert Painter as CEO of Trimble.
  • The resignation of Chris Hylen, CEO of Imperva.
  • The retirements of Steve Milligan, CEO of Western Digital; and Rob Smith, CEO of Filtronic.
  • The departure of Steven Berglund, CEO of Trimble (becomes executive chairman).
  • IPO filings for Nasdaq from Sprout Social, a provider of social media management solutions; and China-based Ehang, which makes autonomous aerial vehicles.
  • An IPO filing for the Philippine Stock Exchange from Cal-Comp Technology (Philippines), a consumer tech firm.

Research results and predictions

EMEA/Africa:

  • MENA enterprise information security and risk management spending will total $1.7 billion in 2020, an increase of 10.7% from 2019, according to Gartner.

Worldwide:

  • Global server shipments picked up 11.2% sequentially in Q319, and are expected to see a mild on-quarter increase in Q4, according to Digitimes Research.
  • Worldwide notebook shipments are forecast to drop 1.8% sequentially in Q419 after registering a nearly 2% increase in the prior quarter, according to Digitimes Research.
  • Worldwide end-user spending on wearable devices will total $52 billion in 2020, an increase of 27%, according to Gartner. In 2019, worldwide end-user spending on wearable devices is on pace to reach $41 billion.
  • Worldwide spending on the technologies and services that enable the digital transformation (DX) of business practices, products and organisations is forecast to reach $2.3 trillion in 2023, according to IDC. DX spending is expected to steadily expand throughout the 2019-2023 forecast period, achieving a five-year compound annual growth rate of 17.1%.
  • The worldwide tablet market returned to growth in 3Q19, with 37.6 million units shipped globally for a year-over-year increase of 1.9%, according to IDC.

Stock market changes

  • JSE All share index: Up 2.7%
  • FTSE100: Down 0.3%
  • DAX: Up 0.5%
  • NYSE (Dow): Up 1.4%
  • S&P 500: Up 1.5% (all-time high reached during the week)
  • Nasdaq: Up 1.7% (all-time high reached during the week)
  • Nikkei225: Up 0.2% (highest weekend close this year)
  • Hang Seng: Up 1.6%
  • Shanghai: Up 0.1%

Look out for

International:

  • Further developments regarding investigations into the big tech boys.

Africa:

  • The future of Angola Telecom.

South Africa:

  • MTN selling off some of its towers across Africa.

Final word

Fortune magazine has just published its 2019 Future 50 list.

To identify the Future 50, Fortune, together with management consultant BCG, examined more than 1 000 publicly traded companies with at least $20 billion in market value or $10 billion in revenue in the 12 months through to the end of 2018. A company’s final score represents its outperformance across the following metrics when compared with peers of a similar size.

Thirty percent of a company’s score is based on market potential, defined as its expected future growth as determined by financial markets. This is assessed by calculating the present value of its growth opportunities, which represents the proportion of its market value not attributable to the earnings stream from its existing business model.

The other 70% is based on a company’s capacity to deliver against this potential. This score comprises 19 factors, selected for their ability to predict growth over the following five years. These factors fall into four categories: strategy, technology and investments, people and structure.

Included in the list are:

1: Workday
2: Square
3: ServiceNow
5: Spotify
6: Atlassian
7: Xiaomi
9: Salesforce.com
11: Alibaba Group
12: Tencent Holdings
13: Twitter
17: Xilinx
18: Alphabet
19: Netease
20: Dassault Systemes
21: Intuit
22: China Tower
24: PayPal
25: Adobe
26: Nvidia
27: Autodesk
31: Amazon.com
34: BOE Technology Group
38: Paychex
42: VMware
43: Visa
46: Accenture
47: CDW
49: Facebook

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