eSP - IT Solution Providers in Europe

Cisco shows exactly how serious it is about video conferencing with the $3 billion acquisition of Tandberg that will change the video conferencing industry landscape forever.

The all-cash tender is 11% over Tandberg's closing price. Tandberg reported $809 million in revenue last year, and has close to $200 million in cash. Cisco's routers and switches produce 65% gross profit margins and one of the attractions of the acquisition (says Cisco) is Tandberg's gross margin of 66%.

Cisco is one of tech's most aggressive acquirers with almost 40 companies bought over the last five years, including Scientific Atlanta, WebEx, and Pure Digital ( of Flip video fame.)

IDC's Channel Panel in USA found partner-delivered services revenues remained strong in Q2 2009 with the highest levels (47% of total partner revenue) coming from those selling networking products.

Revenue received from reselling 3rd-party services is dramatically lower, with storage services leading the way and contributing just over 15% of partner revenue.

Services continue to grow in importance to channel partners largely because of their universal demand: all products within the IT market require services and the types of services are independent of the product vendor. In addition, services can be sold to customers at a variety of times and represent a potential annuity revenue stream for the astute channel partner.

EMEA server shipments totalled just over 490,000 units in Q2 2009 (decline of 32%) and server revenue totaled $3 billion in Q2 (decline of 36% from the same quarter last year.)

In the x86 market, total volumes in EMEA declined 31% compared Q2 2008. HP (No.1 spot) declined 31%. IBM (No. 2) and Dell (No. 3) showed the largest declines in the top five at 35%.

RISC and Itanium UNIX revenues declined 38% in Q2. Of the top five vendors in this segment, Sun regained the No. 1 despite a decline of 40%. IBM (No. 2) was the least impacted but still fell 22%. HP (No. 3) posted a 45% decline. Bull (No. 4) fell 46%. And Fujitsu (No. 5) suffered largest decline of 73% due to weakness in demand in key countries such as Germany and a greater focus on its x86 product portfolio.

Go Gartner on Servers in EMEA

Experts call it Radically Simple IT. Most enterprise systems are constructed using a "cathedral approach" resembling great edifices from the Middle Ages. Companies often find it too expensive and too difficult to modify their systems to exploit new business opportunities.

David Upton and Bradley Staats have identified how to reduce a company’s costs and support the growth of business. They call it a "path based" approach (rather than defining all of the specs before launch, companies instead provide a path for development over time.)

Japan’s Shinsei Bank succeeded in developing and deploying an entirely new enterprise system in one year for only $55 million: That’s 25% of the time and about 10% of the cost of installing a traditional packaged system.

Go "Radically Simple IT"