Welcome!

Mobile IoT Authors: Pat Romanski, Yeshim Deniz, Elizabeth White, Zakia Bouachraoui, Carmen Gonzalez

Related Topics: Java IoT, Industrial IoT, Microservices Expo, Linux Containers, IT SOLUTIONS GUIDE, Eclipse

Java IoT: Article

"Mergermania" Isn't Just Back - It's Back With a Vengeance

Oracle Controls Retek, CA Snags Concord: Who'll Be Getting Hitched Next?

When in October of last year I asked the rhetorical question "Is Mergermania Back?" (JDJ, Vol. 9, issue 10), there wasn't much doubt that it already was, but it took until last month to truly demonstrate just to what extent. It's not just back; in March we saw it's back with a vengeance.

IBM has gobbled up Ascential ($1.1 billion) and - SAP's attempts to do the same notwithstanding - Oracle just snagged Retek ($643.3 million), a much smaller deal than its January takeover of PeopleSoft ($10.6 billion), but a significant one nonetheless.

Its industry significance was underlined by the CEO of Retek, Marty Leestma, who was crystal clear why ERP arch-rivals SAP and Oracle had both pursued his company so keenly, and said so: "This is the first time in 15 years that there hasn't been a new game-changing technology out there, and that's driving this consolidation," he said.

In Leestma's view, everyone in the industry struggles with how to grow when there's no push coming from new technology. In the case of a company like Oracle, it clearly has the opportunity to leverage its very high profit margins and fund growth-by-acquisition using its cash hoards. So where Retek has just gone, who's to say Lawson Software, Siebel Systems, or BEA Systems won't shortly follow?

Question one for April then is: Who'll be getting hitched next?

After that comes the inevitable question two: Which mergers/takeovers will be the first to be unpicked? Who'll be the first to the divorce court? At the time of my original "Is Mergermania Back?" commentary, you may recall, Dr. Adam Kolowa, CEO of Parasoft, sounded a word of caution, asking us to remember Compaq buying DEC or HP buying Compaq - successive takeovers that Kolowa felt had both failed. "They brought more headaches than they were worth to the companies that were involved in them," he declared.

Which in turn begs the obvious third question: Who's right? The giants like HP or Oracle who seek to grow ever bigger (or SAP, who surely won't let their defeat by Oracle over Retek blunt their enthusiasm for some other quarry sometime soon); or those who remain independent, the way that - say - Sun seems determined to do?

Back in October, JBoss CEO Marc Fleury commented: "Consolidation is a natural fact in the software markets" and went on to note that the mergers and consolidations might well be catalyzed by the recent rise of open source software. "Open source accelerates this natural consolidation by putting great pressure on the profits of infrastructure software players," Fleury commented.

Like Leestma then, Fleury sees mergermania not so much in terms of winners and losers. Rather it's a function of efficiencies at play.

But what about Leestma's observation that "there's no push coming from new technology"? Is he right on the money there? Or is there still life in the old i-technology dog yet, with innovations such as Flash video for example about to rip in 2005 through the WWW - an almost classic "disruptive technology" in the precisely the game-changing sense Leestma believes is absent from enterprise software?

Disruptive technologies are usually introduced to the market by small start-up enterprises, not giants like Oracle and SAP. So an agile player like Macromedia can potentially run rings round the industry, and Clay Christensen's predictions may come very true, with Flash video gaining a strategic foothold that allows Macromedia over time to move up-market through performance improvements until it finally displaces all market incumbents and becomes the sole purveyor of quite simply the only way to deliver streaming video over the Web, just as we have been demonstrating recently at SYS-CON.TV.

Back to mergermania though. At this writing, telco rivals Qwest and Verizon both still want to conjoin with MCI, an $8.5 billion or a $6.7 billion deal depending on who wins - a little smaller than Oracle-PeopleSoft, but even so. Which suggests that April will turn out to be every bit as lively as March has been - perhaps even more so, if the focus moves from telecommunications back to enterprise software.

We can all confidently expect substantial ongoing M&A activity then. It's only really a question now of when? and who? Get ready for the next wave of announcements!

More Stories By Jeremy Geelan

Jeremy Geelan is Chairman & CEO of the 21st Century Internet Group, Inc. and an Executive Academy Member of the International Academy of Digital Arts & Sciences. Formerly he was President & COO at Cloud Expo, Inc. and Conference Chair of the worldwide Cloud Expo series. He appears regularly at conferences and trade shows, speaking to technology audiences across six continents. You can follow him on twitter: @jg21.

Comments (14)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


IoT & Smart Cities Stories
IT professionals are also embracing the reality of Serverless architectures, which are critical to developing and operating real-time applications and services. Serverless is particularly important as enterprises of all sizes develop and deploy Internet of Things (IoT) initiatives. Serverless and Kubernetes are great examples of continuous, rapid pace of change in enterprise IT. They also raise a number of critical issues and questions about employee training, development processes, and opera...
This month @nodexl announced that ServerlessSUMMIT & DevOpsSUMMIT own the world's top three most influential Kubernetes domains which are more influential than LinkedIn, Twitter, YouTube, Medium, Infoworld and Microsoft combined. NodeXL is a template for Microsoft® Excel® (2007, 2010, 2013 and 2016) on Windows (XP, Vista, 7, 8, 10) that lets you enter a network edge list into a workbook, click a button, see a network graph, and get a detailed summary report, all in the familiar environment of...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
AI and machine learning disruption for Enterprises started happening in the areas such as IT operations management (ITOPs) and Cloud management and SaaS apps. In 2019 CIOs will see disruptive solutions for Cloud & Devops, AI/ML driven IT Ops and Cloud Ops. Customers want AI-driven multi-cloud operations for monitoring, detection, prevention of disruptions. Disruptions cause revenue loss, unhappy users, impacts brand reputation etc.
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
Atmosera delivers modern cloud services that maximize the advantages of cloud-based infrastructures. Offering private, hybrid, and public cloud solutions, Atmosera works closely with customers to engineer, deploy, and operate cloud architectures with advanced services that deliver strategic business outcomes. Atmosera's expertise simplifies the process of cloud transformation and our 20+ years of experience managing complex IT environments provides our customers with the confidence and trust tha...
The Japan External Trade Organization (JETRO) is a non-profit organization that provides business support services to companies expanding to Japan. With the support of JETRO's dedicated staff, clients can incorporate their business; receive visa, immigration, and HR support; find dedicated office space; identify local government subsidies; get tailored market studies; and more.
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
As you know, enterprise IT conversation over the past year have often centered upon the open-source Kubernetes container orchestration system. In fact, Kubernetes has emerged as the key technology -- and even primary platform -- of cloud migrations for a wide variety of organizations. Kubernetes is critical to forward-looking enterprises that continue to push their IT infrastructures toward maximum functionality, scalability, and flexibility. As they do so, IT professionals are also embr...
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...