Editor's Comment 8020 EUROPA
The team
EDITOR'S
8020 Europa
3rd Floor, Armstrong House
38 Market Square, Uxbridge COMMENT
Middlesex, UB8 1LH
United Kingdom
Tel: +44 1895 454 458
Fax: +44 1895 454 598
www.8020europa.com
Channel beware:
Editorial
Editor: John Garratt M&A activity
DDI +44 1895 454595
john.garratt@iteuropa.com
We make no excuse for returning to the theme of acquisitions. Last month it
was HP and EDS, before that, we saw rumours of Cisco or IBM buying Citrix
Business Development Director:
as well as EMC actually buying Iomega. The prospects of a tough market this
John Chapman year and next are driving valuations down to the point where a market forms
DDI +44 161 787 7530 as funds become available. Companies in IT and private capital who have
john.chapman@iteuropa.com
built war chests over the last few years, are now faced with putting those
funds to more productive use, and want to buy business. We report on the
Sales
wave of M&A activity in the European channel in our features pages.
Sales Manager:
Unfortunately for the channels selling these products, reduced product
Annabel Devonshire
DDI +44 1895 454451
choice too often means more returns for the vendor, but nothing much for the
Mob +44 7977 473458
channel. A beauty contest after a takeover pitches two sets of channels against
annabel.devonshire@iteuropa.com
each other, so that even those selected to carry the new lines know that there
will be little left over for market development, especially when venture capital
Design
or private equity is looking for a quick return, as it always is. And with hot
Reaction: Adam Boreham money in the driving seat, costs will continue to be pushed down regardless
DDI +44 1462 629 260 of the long term development or needs of the channel.
info@reactionvm.co.uk
So you won’t hear the channel cheering M&A activity as the reasons
www.reactionvm.co.uk
become apparent - much the same as seems to be happening at Alcatel-
Lucent after two years of merger, nearly 20,000 jobs have gone, there’s no
IT Europa Ltd
dividend this year and no real channel engagement that we can see.
Chairman: Chris Boeree
DDI +44 1895 454 604
While rationalisation and consolidation have always been features of
chris.boeree@iteuropa.com
this market, this time round, it is the money that is talking, not markets,
geographical or vertical expansions, or technologies. The rush to scale in
Managing Director: Alan Norman
distribution is having its casualties as we have seen already this year. Just how
DDI +44 1895 454 604
big is big enough? There doesn’t seem to be a natural limit.
alan.norman@iteuropa.com European mergers and acquisitions reached an all-time high in the
technology sector last year. This was businesses attempting to boost growth
and remain competitive, based on research by Regent Associates. But the UK
market slowed - in-country deals were definitely lower, particularly towards
the end of 2007. This implies that the bulk of the deals were international, if
not global. As the big get even bigger, this will continue.
Finally, though, we can recognise an opposing force - nomadisation - as
communications get better, and markets and organisations permit, we all
can be more efficient by staying where we are rather driving to work, self-
employed rather than committed to a single employer. We get a hint of what’s
happening by the explosion of news about teleconferencing. Now, if we can
just get the security and bandwidth issues solved.....
We want to hear from you if you are affected by, or have views
on any of the issues we raise.
john.garratt@iteuropa.com
JUNE 2008 8020 EUROPA 01
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