The announcement that HP was acquiring EDS rightly sent shockwaves around the world. What’s it mean? Well, it means a number of things in no particular order:
1) Look out IBM, the new sheriff in town, Mark Hurd, who has rolled 7’s for a few years now, is looking like a winner again, and the gains in efficiencies will come out of IBM’s hide;
2) bad, bad news for Dell. This is a well-run products company buying a poorly run services company with low moral. They can turn it around where the old regime that failed, couldn’t. With this arm of enterprise customer delivery functioning well, look out Dell;
3) this is really bad news for Sun – really, really bad;
4) it also means size in service is more meaningful than before. Whereas HP bought a small, but very well respected IT services company (Knightsbridge) awhile back, with a hundred or so million in revenue, now that looks like an appetizer. So long midsize IT services deals for larger enterprise players; and
5) the big 4 Indian IT and outsourcing companies will now have to really step up their acquisition strategies to counter the customer aggregation capabilities of the new combined entity.
Watch for more with an emphasis on cross-border.
marty