Friday, April 24, 2009

Oracle Buys Sun - Another one bites the dust!

Database giant Oracle announced Monday that it will buy Sun Microsystems for $9.50 per share—roughly $7.4 billion. The two companies reached an agreement after an unsuccessful bid by IBM fell short at $9.40 per share.Oracle will use a combination of cash and borrowed money to pay for the purchase, which will cost Oracle $5.6 billion after taking into account Sun's debt and cash holdings.
Oracle predicted the merger will increase its annual operating income by $1.5 billion and add at least 15 cents per share to net income in its first year.
Oracle is a software and services company, best known for advanced database management software used by many of the world's largest enterprises. Sun produces both hardware and software. It produces Solaris, a popular version of the Unix operating system. Sun is also the creator of Java, a software language and development system that runs on hundreds of millions of devices, ranging from mainframe computers to cellphones. Sun makes server computers that use its own Sparc processor chips, but also makes machines that run processors from Intel Corp. In addition, Sun makes data storage gear, competing against HP and EMC Corp. of Hopkinton.Purchasing Sun confirms this shift by enlarging Oracle’s middleware business. More importantly, the deal means Oracle now goes up against IBM and HP in selling servers.
The Sun Solaris operating system is the leading platform for the Oracle database. With the acquisition of Sun, Oracle can optimize the Oracle database for some of the unique, high-end features of Solaris. With it's latest conquest, Oracle plans to offer a broad range of products, including servers and storage, with all the integrated pieces: hardware operating system, database, middleware and applications.
As became apparent with the acquisition of PeopleSoft in January 2005, Oracle has made acquisitions an important component of its growth strategy.Apart from the high-profile acquisitions which include BEA Systems, PeopleSoft, Hyperion and iflex, the behemoth has also swallowed whole numeorus other IT enterprises and has been expanding it's tentacles across the IT spectrum.
Oracle last major purchase was BEA Systems, which strengthened the former's foothold in middleware technologies. The BEA purchase meant Oracle was now selling middleware, or software that acts as a bridge between different applications. This put the company in competition against other middleware companies such as IBM.
The deal also has a significant financial implications. Already shares of Oracle stock closed down 24 cents at $18.82 after the news, while Sun Microsystems stock rose $2.46 to $9.15, both on the Nasdaq stock exchange. However the biggest and most obvious question is the extent of "Rightsizing". Industry analysts estimate that Oracle’s cost savings from Sun operations suggest job cuts of up to 10,000 workers from Sun’s payroll of more than 30,000.

Oracle's appetite for acquisitions may seem insatiable, but one has to marvel at the sheer size of this IT stalwart. What began as a databse company, today stands tall as a paragon of end to end solutions provider. As a matter of fact, that is the ultimate goal of this gargantuan beast, to provide an highly integrated and equally secure solution to all its customers.

But with this latest buy, has Oracle bitten off more than it can chew?

Tuesday, April 14, 2009

Satyam has a new Daddy!

After months of speculation and debate, the Mahindra & Mahindra Infotech arm, Tech Mahindra has won the bid for the scandal hit Satyam with its valuation of Rs. 58 per share. Tech Mahindra's offer beat industry favorite L&T's Rs. 49 per share and Wilbur Ross's Rs. 20.
The current price of the shares (at the time of this blog post) wastrading at Rs. 48.85.
L&T, which was the front-runner for the Satyam acquisition said that their maximum bid for the tainted software giant would have been Rs. 55 in any event. One of the factors for the price cap was the fact that L&T had purchased additional stake at a higher price.
For the 47000 odd staffers at Satyam, not all is hunky-dory as Tech Mahindra has been subtly mentioning the 'F' word. Pink slips could be a possibility considering the investment made by the latter for the acquisition and no opposition is expected from the Government on this front.
Although Tech M has won the bid, they are well aware that the real battle has just begun. Right from synergising the business practices to settling the pedning lawsuits, Tech M has a long and arduous journey ahead.
Will the most talked about acquisition of the year be also the most successful one? Time will tell!

Sunday, April 12, 2009

The Death of Democracy

The Samajwadi Party (SP), headed by Mulayam Singh Yadav released its manifesto over the weekend. Nothing unusual as this is the election season and all potential candidates are making promises to the ‘aam’ janta to secure their vote. But the provisions, rather promises in the SP’s manifesto make for a shocking read. SP wants to curb and in some instances remove the usage of computers. They also want to abolish English – Medium Schools. Their argument, these actions would create a level playing field for all and generate jobs.
I can’t really speak for the whole country but I am sure that the urban population is probably outraged or at least gravely concerned.
Take a look at the statistics of the English language alone:
· Over 700 million people, speak English, as a foreign language
· More than half of the world's technical and scientific periodicals are in English
· English is the medium for 80% of the information stored in the world's computers
Speaking fluent English is one of the major competitive edges that India possesses over China, in the service industry. Moreover a well educated workforce makes India an attractive prospect for foreign business investments.
As far as the use of computers are concerned, perhaps the people at SP should be given a tour of the may InfoTech campuses across the country! The Information Technology (IT) industry in India is one of the fastest growing industries with valuable brand equity in the global markets. The IT industry in India comprises of software industry and information technology enabled services (ITES), which also includes business process outsourcing (BPO) industry. India is considered as a pioneer in software development and a favorite destination for IT-enabled services. The IT sector is perhaps one of the major components of our nation’s revenue machinery. Even outside the IT sector computers have enabled to streamline many business processes. The biggest example of course is the government’s own Indian Railways. Banning the use of computers wherever manual work is possible is nothing short of placing the country back into the Stone Age!
The party has also proclaimed an end to mechanized farming and high corporate salaries. I might be able to make peace with the latter, but the same argument stands for mechanized farming as it does for the use of computers. Considering that India is still an agrarian economy, the use of technology would greatly aid the nation’s agricultural productivity and output.
It seems that the party has taken its party symbol (a bicycle) a little too literally and is now intending to bring us all to the good old days of the pre-independence era!

Friday, April 10, 2009

In Praise of FRIENDS

In the early 90’s, the television scene in the US was brimming with new-age, tongue-in-cheek plots for new shows. Many failed, some ran for a few seasons, but few have found the same cult status success as the hit TV series, FRIENDS.

With its pilot episode airing in 1994, the cast (relatively unknown at the time), was instantly catapulted to stardom and each one of them became overnight sensations across USA. The cast included David Schwimmer (Dr. Ross Gellar) who plays the nerdy paleontologist , Courtney Cox (Monica Geller), is an obsessive compulsive chef, Matthew Perry (Chandler Bing) is the resident funny man, Lisa Kudrow (Phoebe Buffet) is the eccentric masseuse, Matt LeBlanc (Joey Trivioanni) is the dim-witted actor and Jennifer Aniston (Rachel Green) is an executive at a Fashion House.

Set in the bustling city of New York, the show chronicled the hilarious lives and loves of the protagonists and in the process connected with the audience with its own unique flavor of humor. The most common places that are visible in the show are the apartments of Joey –Chandler and that of Monica and Rachel. The other location which audiences may remember vividly is the coffee house-‘Central Perk’ which was the friends’ after hours hang-out.

The hit TV show came to a finale in its tenth season, which saw the evergreen friends going their separate ways, (Ross and Rachel parent their baby daughter, Monica and Chandler have adopted twins, Phoebe marries her steady boyfriend Mike and Joey moves to Los Angeles to pursue his flourishing acting career).

Although not suitable for youngsters due to its sexual innuendos, the sitcom found a place of admiration in the hearts of all ages for its candid approach to many topics, including lesbianism, premarital sex, child adoption and live-in relationships.

Today FRIENDS has become part of our world pop-culture and has become the definitive show case for the trials and tribulations as well as the joy and happiness of a relationship we all call as Friend.
To sum up the sentiment of FRIENDS we’d like to conclude with a line from the theme song of the show,

“So no one told you life was gonna be this way,
Your job’s a joke , you’re broke, your love life’s D.O.A,
It’s like you’re always stuck in second gear,
And when it hasn’t been your day, your week, your month or even your year…
I’ll be there for you…”