Every blogger is doing a 2009 predictions post at this time of year, so why shouldn’t I? In fact, this is the only time I’ll be able to say my predictions for the previous year were perfect (because I was zero-for-zero), so I’m going to enjoy my unblemished record while I can…
VMware gets acquired: Whomever owns VMW will own the 21st century datacenter. Cisco and Microsoft have enough cash on the balance sheet to foot the bill, but will they? A Cisco/EMC merger would be pretty interesting, too.
Someone purchases Citrix: Again, Cisco and Microsoft would be logical acquirers. Cisco is focused on growing the application side of their business and Microsoft can always use more ammo against VMware.
Continued slow growth of cloud computing in the enterprise: Due to concerns about security, cloud computing adoption in the enterprise will still severely lag that of the SMB/SME markets.
Social media works its way into enterprise IT: I think there is huge value in leveraging social media to help IT professionals do their jobs better. New entrants to the enterprise IT market that lack the baggage of legacy product lines will integrate social media into their products and use rich internet application technologies to enable that integration.
M&A frenzy begins in Q2: Right around the middle of 2009 I predict that investors and operating companies will perceive a (near) bottom in the market and will go shopping in earnest for assets and companies.
Feel free to comment on these predictions or add some of your own!
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3 comments
Hey John, I enjoyed your blog posting. Thought I would add my two cents on your predictions. Hopefully this is the rationale behind how this type of forum is supposed to work.
I think Cisco is more likely to acquire Riverbed to consolidate their hegemony in layer 4 switching, especially at RVBDs more rational valuation levels. I think Cisco would require a greater foothold in the data center before they were interested in Citrix for its Xensource asset. Also, there is potential overlap between Webex and Citrix on multiple other fronts. To me, IBM seems like a much more viable acquirer of Citrix. Maybe HP is the dark horse in all of this since a Citrix deal fills in a lot of gaps for them and they seem more eager for large deals than IBM.
I think the resurgence of M&A activity will be a function of companies beginning to accept current valuation levels as a reality. At this point, current valuations are still perceived as a temporary market anomaly. Only when the reality of what is happening has sunken in, will deals begin to occur in earnest. It might help if the financing markets opened up as well…
I am fairly bearish on social media in the enterprise. I think it will be a long time before companies really get any value from social media internally. It will require significant experimentation to determine how best to use the concepts. Also, there is not a great deal of money to be made from this as the technology is fairly straight forward.
Thanks for the response Matt and this is EXACTLY how this is supposed to work! I enjoy getting comments, that is what makes the discussion more interesting.
Re: social media in enterprise IT, I should have been more specific and said datacenter IT.
There is a ton of rich information on the Internet about how to better operate/manage systems and network infrastructure that is out-of-band from existing management tools.
I think if you can get that information in-band and integrated with datacenter applications, then you might have something fairly interesting.
BTW we should get lunch soon, it has been a while…
I’m definitely in on the Social Media infiltrating enterprise IT. Corporate users, especially younger ones, are starting to demand it. If the company doesn’t offer it, they’ll find it elsewhere via Facebook, AIM, Google, etc. With so many iPhones out there, firewalls can’t even effectively block people from social networking at the office, so companies might as well embrace it and realize that there’s a lot of value in co-workers getting to know each other better and sharing ideas.
Microsoft buying VMWare would be pretty big, but I’m betting against that one. Microsoft has a very strong competitor to VMWare already and a much stronger sales force presence at enterprise customers. Also, if Microsoft really buys Yahoo’s search business, then I think that will be their main integration focus for awhile.
The bankers will love your predictions, seeing as M&A has been all but non-existant over the last few quarters. It’ll be interesting to see some action again (though probably no debt-based buyouts for awhile).