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The Techday Weekender - Oct 29th 2011

29 Oct 11

It may have been a short week in New Zealand, but the technology industry didn’t skip a beat, with several businesses growing after landing significant contracts, and one business shrinking to land the biggest contract of all.

At the Telecom AGM on Wednesday, shareholders voted 99.8% in favour of splitting the telco from its network arm, Chorus. The split from the retail division was necessary for Chorus to be granted its 70% share of the government’s $1.35 billion Ultra Fast Broadband contract. While the vote never looked like failing, it still marked a historic day, CEO Paul Reynolds telling the audience Telecom is the first incumbent telco in the world to take such a dramatic step, and that others would be watching ‘with the greatest interest and intensity’.

The split is due to be completed by November 30, with Reynolds to depart the company shortly afterwards.

Meanwhile, both Datacom and Revera have signed tidy 10-year contracts to provide Infrastructure-as-a-Service (IaaS) to the government. A third provider, IBM, is said to still be in negotiations, but both the successful companies took the opportunity to promote their snazzy new data centres, Revera’s in Wellington (opening in 2012) and Datacom’s in Hamilton (opening 2013).

Speaking of data centre deals, Telecom subsidiary Gen-i also landed a multi-million dollar contract this week, this one with Westpac. The bank indicated it would be transferring to new data centre facilities when it re-appointed IBM as its technology provider earlier this month.

Finally, kiwi network monitoring company Endace launched a significant overseas expansion this week, announcing it is opening an office in Silicon Valley and hiring Juniper Networks veteran Spencer Greene to push its high-end product to enterprises. The company’s marketing guru, Tim Nichols (responsible for 2degrees’ entry strategy), says the market has finally caught up with Endace’s network monitoring technology, which was initially developed for extreme high-end users like telcos and government.

There were plenty of companies making big moves overseas this week too, the biggest being Sony, which bought Ericsson out of its 50% stake in their shared mobile handset business, Sony Ericsson. The deal, worth over NZ$1.8 billion, will see Sony selling mobile phones alongside its TV, PC and tablet range, in what it calls its ‘four-screen strategy’.

Over at Hewlett-Packard, new boss Meg Whitman u-turned on departed CEO Leo Apotheker’s plan to sell the company’s PC division, PSG. The initial proposal sparked claims the PC market was dead, but the decision suggests there may be life in the old girl yet.

That’s more than can be said for the Motorola Xoom, it seems, with Motorola Mobility revealing it sold just 100,000 of the tablets in the third quarter of this year (by comparison, Apple sold 11.12 million iPads). The result will be food for thought for Google, which is due to purchase Motorola Mobility at the end of the year for US$12.5 billion, subject to regulatory approval.

Finally, IBM made a historic announcement this week, naming Virginia ‘Ginni’ Rometty to take over from Sam Palmisano as CEO when he retires in January. In over 100 years of business, Rometty will be IBM’s first female CEO.

Have a great weekend, readers – and if you make it to the Armageddon comic and gaming expo in Auckland, be sure and drop by our Game Console stand to be in to win prizes including Xbox 360 games, Hasbro lightsabers, and a Logitech PC gaming peripheral pack worth over $900!

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