June 29th, 2010
due diligence
Function: noun
Date: 1903
1 : the care that a reasonable person exercises under the circumstances to avoid harm to other persons or their property
2 : research and analysis of a company or organization done in preparation for a business transaction (as a corporate merger or purchase of securities)
It seems that back in 2008 HP forgot about this very important term and M&A requirement when it acquired Electronic Data Services Corporation (EDS .)
Recently, a British High Court ruled that EDS was at fault for a bungled customer relationship management (CRM) implementation at British Sky Broadcasting Group (BSkyB) back in 2000. This bungling, which was due to EDS’ misrepresentation of how long the implementation of the system would take in order to win the contract, will cost HP $460 million. Ouch.
BSkyB terminated the work in 2002 after the EDS timeline was well past the due date and went ahead and completed the implementation on their own in March 2006. In the meantime, they started legal action against EDS in 2004, went to trial in 2007, and the British High Court ruled in their favor in January 2010.
Looking at HP’s performance, it is apparent that for various consecutive quarters, EDS emerged as a smart purchase by HP, as the company’s service unit was the only growing business line. But the takeover came with some extra baggage, which included a hefty lawsuit.
This baggage should definitely have been vetted out and acknowledged in the $13.9 billion acquisition price. I thought it was a high price even before learning about this.
It seems very apparent to me that someone, or some group, did not do their research (re: due diligence) and this ticking bomb went unnoticed or disregarded for quite some time.
I can hear the EDS M&A lawyers laughing now….
Posted in General Musings | 1 Comment »
May 27th, 2010
On Thursday, May 13, 2010 Citrix and Amazon announced a pilot program where Citrix’s XenApp application streaming/virtualization product will run on Amazon’s Elastic Compute Cloud (EC2.)
This pilot program will allow existing Citrix customers who are also members of Amazon’s Windows Server License Mobility Pilot to move their XenApp licenses from their own data centers to the EC2 cloud. Moving XenApp to the EC2 cloud could benefit businesses by reducing the number of physical servers required in their data centers as well as having their platform reside in a fully supported environment.
This pilot program currently does not support Amazon’s Virtual Private Cloud, which is designed to bring enterprise-class security to computing resources that run in Amazon’s data centers, but this support is slated to be available at a future date.
This pilot is definitely a huge step forward for cloud computing and will be very interesting to hear about how the program was received.
If anyone is a member of this pilot program, I would love to hear from you.
Regards,
TASCer
Tags: amazon, application, citrix, data center, EC2, pilot, servers, virtualization, web services, xenapp
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April 20th, 2010
Just 10 days before the dissolution of the longstanding agreement between HP and Cisco is completed, HP recently fired a loud shot across Cisco’s bow.
One week after closing the $2.7 billion acquisition of 3Com, HP announced on Monday that its newest “Cisco-free” data center takes advantage of HP/3Com equipment to “achieve twice the port and capacity density, and a 50 percent reduction in power consumption versus previous solutions.”
This shot is meant to alert Cisco of the direct competition between their solution and Cisco’s Unified Computing System, which combines servers, storage, networking and virtualization technology into a single box.
States Ken Gray, HP Vice President in a recent press release: “We’re Cisco-free in this data center and have a plan to extend this freedom across all of our internal IT data centers next year.”
Ouch! Did he really need to use the word ‘freedom’?
It should also be noted that the HP solution is promised to be an open architecture, allowing interoperability with multiple vendors and conforming to industry standards.
Thank goodness there are not kids involved, I’m sure this shot was heard loud and clear in San Jose….
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March 22nd, 2010
On Saturday, March 22, 2010 the company BitDefender had some major problems with its BitDefender 2009 and 2010 products for x64 platforms. It seems the latest definition updates caused both Windows files (.dll, .exe) as well as their own to be detected as files infected with the Trojan.FakeAlert.5 virus and moved to Quarantine. This faulty detection affected some systems so bad that they were unable to boot and users were forced to use the Last Known Good utility in Windows that has turned out over the years to be one of the best features Microsoft has ever come up with.
The company’s website does not state an approximation on how many systems were affected, but I’m sure they definitely looked on the bright side of things as it affected only one platform and not both x386 and x64.
Read BitDefenders’ Press Note here regarding the faulty definitions update.
It is very strange to me that on their website, in the Press Center area, they have a blurb regarding an award they received recently on the main page. Only after clicking on More News, do you see the more important and timely news… I feel this would be the perfect case of ‘full disclosure’ if there ever was one.
In today’s day and age of virtual technologies (easily created and managed test and Dev environments), testing tools (load, regression), version control (SourceForge, Team Foundation Server) and testing methodologies, situations such as these should not happen anymore; period. I expect some heads to roll on this one.
I would like to keep an eye on how this will affects the company going forward as I have never heard of them until I read about this issue over the weekend, but it seems to be a private company created in 2001 which also received some financial assistance in the end of 2007 from an investment group made up of both U.S. and Romanian individuals. And, if the way they handled this news is any indication, I would be very hard pressed to find any open and readily available divulgence of negative information anywhere, especially their website….
Tags: anti-virus, av, bitdefender, definitions, software, twsting, update, virus
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February 19th, 2010
April 30, 2010 will be the death knell of the longstanding HP and Cisco partnership.
For years Cisco has had a contract with HP to provide system integrations, but this partnership has been deteriorating for quite some time and was accelerated when Cisco recently created and started touting its Unified Computing System (UCS). UCS is a data center solution that directly competes against the larger server vendors such as: HP, IBM, and others. Cisco has decided not to renew their contract with HP, which will expire on April 30th, 2010.
It seems the main issue between the two is how each of them views customer value. While this is a VERY subjective matter, it seems they do not see eye to eye on this extremely important item. I personally see this as a somewhat fluff (re: easy out) excuse as Cisco is making a bold move into a new space.
Which company has the ‘better’ view of customer value will only be determined in the long term as customers will have to start looking at their data center and infrastructure options differently going forward.
While both sides allude to the fact that it will be ‘business as normal’ to their customers, we all know that things don’t work that way in IT; and there will be issues.
Both companies have been doing pretty well in 2010, and it will be very interesting to see how things work out for the rest of the year and going forward.
It is, in a nutshell: Mark Hurd vs. Tom Chambers
With similar market share and both having stellar management, I would have to side with Mr. Chambers. I think Chambers made a very tough, calculated, and important decision that will turn out to be a big piece of his legacy.
As an aside; Juniper and/or Extreme may see an offer in their near future. Look at Juniper being the first name bandied about due to their recent security issues.
Todd
Tags: cisco, hp, integration, IT
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February 4th, 2010
Yesterday in after hours trading, Cisco (CSCO) beat out analysts earnings estimates and saw it’s share price spike up almost 4%. This spike was due in large part to corporations opening up their wallets for long awaited infrastructure upgrades and overhauls.
This is a very good sign as the market leader in business networking equipment is usually a pretty good bellwether for the IT industry, if not the national economy as a whole.
In addition, CEO John Chambers went on record today stating: “this sharp increase in capital spending is a precursor to jobs growth for the entire U.S. economy.”
I wonder what percentage of corporations opening their wallets received stimulus monies? It doesn’t matter to me, but finding out would be interesting.
Anyway, things are looking up in regards to our economy in spite of today’s 2 big employment dings. I see late April as an inflection point for the economy.
Created using WordPress iPhone app.
Todd
Tags: cisco, economy
Posted in General Musings | 1 Comment »
November 17th, 2009
My previous post consisted of my feeling that the acquisition of Perot Systems by Dell would not work and that the move into services is a big stretch for Dell. With that said, I must say that I am very impressed with the speed and totality that Dell as integrated this acquisition into their on-line branding and over-all business persona.
However, a key item that bolsters my opinion that this is a sunk cost can be easily realized by the fact that Dell has decided to keep the branding of Perot Systems.
This fact, to me, is a big misstep similar to the one Cisco decided on when it acquired Linksys years ago. Cisco decided to keep the Linksys brand in its entirety until recently. Cisco did not have any integration with Linksys whatsoever until years after the fact. Dell’s saving grace on this point is that they still have their name present (Dell Perot Systems) and a nice and informative tag-line under their logo (Dell perotsystems.) I think Dell may have learned volumes here…
These facts do not dispel my thoughts that the acquisition is a bust, but more that the acquisition was well thought out and planned.
Execution is ALWAYS key.
Dell, and their new-found (re:paid for) IT Services division would be better served if they took Perot’s client base, contracts, prior methodologies, and customer feedback and acted accordingly. This act would also entail the dumping of the Perot Systems brand.
I stand by my earlier post. Good luck Dell.
Todd
Tags: acquisitions, business, Dell, IT, mergers, Perot, services, technology
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October 3rd, 2009
I, for one, do not understand Dell’s mindset in acquiring Perot Systems.
My first instinct is that Dell has maximized their margins on hardware for pretty much all things IT for a good 12-15 years; and are now, in the midst of a recession, looking to bolster their bottom line.
I would say look elsewhere…
With that said, I do give kudos to DELL for the acquisition of EqualLogic as it has expanded their product line. I do not see this latest action as doing the same. Hardware and distribution of hardware are VERY different than Professional Services.
My take on this is that DELL has a very solid hardware and distribution company that has changed the game and made all others in the same space either better or changed their game plan. Now, this same company is paying a pretty steep premium (in my estimation) to delve into a space that is highly competitive and saturated.
But hey, what is $4B to DELL?
I say it is a sunk cost…
I will delve into Perot Systems and EDS in upcoming blogs.
‘Til next time,
Todd
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August 25th, 2009
In a classic case of ‘two steps forward, one step back’, it seems that just after Microsoft gave 22,000 lines of source code and somewhat ‘validated’ the open source community, a couple of researchers found a serious security hole that has been present in the Linux kernel for get this, wait for it… 8 YEARS.
This latest vulnerability bug involves the way kernel-level routines react when left unimplemented. Since these are unimplemented, it leads to the kernel executing code at NULL and leaves the Operating System open to local privilege escalation and completely compromises the system.
This is the second time in less than a month that a serious security vulnerability has been reported in the Linux kernel. The first, in mid-July, described a similar bug regarding NULL reference pointers that put newer versions at risk of complete compromise.
The scope of systems affected by this latest bug are all 2.4 and 2.6 versions since May 2001 running on the Intel platform.
I feel these two occurrences should prompt questions from users of Open Source software. For example:
1) What is the current testing process? It seems regression testing back in May 2001 was not completed at all or not thorough enough.
2) Going forward, how can we feel safer regarding kernel updates?
3) Since SELinux did not catch it, is there a problem with Security-Enhanced Linux?
4) Is there any way we can get a report on the number of systems that were affected? And at what level?
I think there are two upsides to these vulnerabilities, and that is that this should be a wakeup call for the testing process as well as pointing out the fact that even though it is open source and free, utilizing a professional and proactive vendor will help in mitigating your risk.
Talk to you later,
TASCer
Tags: bugs, compromise, open source, Red Hat, RHEL, SELinux, vulnerabilities
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July 23rd, 2009
Microsoft on Monday, the 20th of July, submitted 22,000 lines of source code under a GPLv2 license which will allow four (4) drivers to be added to the Linux kernel. These drivers will enable any Linux distribution to run on Windows Server 2008 and its Hyper-V technology.
While this may seem like a decisive victory for the Open Source community, one may ask themselves: “Why would Microsoft do such a thing?”
This is a very valid question because historically, Microsoft and the Open Source community have been at odds, to say the least.
My reasoning for Microsoft to make such a bold move is as follows:
- Ensures Microsoft is still an important piece of the virtualization and infrastructure equation
- Shows that they, as a company, are willing to adapt and help companies utilizing hybrid solutions, dare I say altruism?
- A strategic move to help cut into VMWare’s market share
- Assist in maintaining server revenue streams
I personally feel that this a good move and one that should have happened a while ago. I guess ‘better late than never’ is an appropriate adage.
It should be interesting to see how it all pans out and I hope the 22,000 lines of code were meticulously tested and re-tested.
‘Til next time…
Tags: GPLv2, microsoft, open source, virtualization
Posted in General Musings | 1 Comment »