by Gary Mintchell | May 17, 2019 | News, Technology
Today’s big enterprise IT news concerns Hewlett Packard Enterprise (HPE) and Cray entering into a definitive agreement under which HPE will acquire Cray for $35.00 per share in cash, in a transaction valued at approximately $1.3 billion, net of cash.
This is another example of technology industry consolidation. We’re seeing it with instrumentation, control, and automation companies. Enterprise IT is rapidly going that way. Both HPE and Dell Technologies have been scarfing up companies either matured and not growing or in need of capital to survive.
Signs of maturing industries mean one kind of shock waves for employment within them. But also this usually means preparing room in the market for new companies with disruptive new technologies and business models. It’s possible that we’re about to see a leap in quantum computing out of all this.
What does this mean for industrial users? We are seeing already companies like HPE moving their powerful compute platforms to the edge. With every advancement, we’ll see additional compute power bringing databases, analytics, AI, video and other applications to more remote installations.
Some additional details from the press release:
“Answers to some of society’s most pressing challenges are buried in massive amounts of data,” said Antonio Neri, President and CEO, HPE. “Only by processing and analyzing this data will we be able to unlock the answers to critical challenges across medicine, climate change, space and more. Cray is a global technology leader in supercomputing and shares our deep commitment to innovation. By combining our world-class teams and technology, we will have the opportunity to drive the next generation of high performance computing and play an important part in advancing the way people live and work.”
The Explosion of Data is Driving Strong HPC Growth
The explosion of data from artificial intelligence, machine learning, and big data analytics and evolving customer needs for data-intensive workloads are driving a significant expansion in HPC.
Over the next three years the HPC segment of the market and associated storage and services is expected to grow from approximately $28 billion in 2018 to approximately $35 billion in 2021, a compound annual growth rate of approximately 9 percent. Exascale is a growing segment of overall HPC opportunities and more than $4 billion of Exascale opportunities are expected to be awarded over the next five years.
“This is an amazing opportunity to bring together Cray’s leading-edge technology and HPE’s wide reach and deep product portfolio, providing customers of all sizes with integrated solutions and unique supercomputing technology to address the full spectrum of their data-intensive needs,” said Peter Ungaro, President and CEO of Cray. “HPE and Cray share a commitment to customer-centric innovation and a vision to create the global leader for the future of high performance computing and AI. On behalf of the Cray Board of Directors, we are pleased to have reached an agreement that we believe maximizes value and are excited for the opportunities that this unique combination will create for both our employees and our customers.”
High performance computing is a key component of HPE’s vision and growth strategy and the company currently offers world-class HPC solutions, including HPE Apollo and SGI, to customers worldwide. This portfolio will be further strengthened by leveraging Cray’s foundational technologies and adding complementary solutions. The combined company will also reach a broader set of end markets, offering enterprise, academic and government customers a broad range of solutions and deep expertise to solve their most complex problems. Together, HPE and Cray will have enhanced opportunities for growth and the integrated platform, scale and resources to lead the Exascale era of high performance computing.
by Gary Mintchell | Dec 19, 2017 | Commentary, News
Is it any wonder about the wisdom of dropping my graduate work in political science while returning to manufacturing and technology?
Try these pieces of obfuscation this week from Washington.
The big tax cut and simplification bill turns out not to simplify anything. Manufacturing organizations sending information to me believe it offers financial rewards to companies who keep workers offshore. Many of us will see little or no tax cut. Do you ever wish like I do that people would mean what they say and say what they mean?
This from FACT. A letter to Congress persons.
On behalf of the Financial Accountability and Corporate Transparency Coalition (FACT) Coalition, we write to urge you to oppose H.R.1, the Tax Cuts and Jobs Act (TCJA). This bill would create significant new tax incentives to move U.S. jobs, profits, and operations overseas, while exploding the deficit. The bill’s complicated structure also creates multiple new loopholes to allow for expanded tax avoidance by large, multinational companies at the expense of small businesses and wholly domestic companies.
The FACT Coalition is a non-partisan alliance of more than 100 state, national, and international organizations working toward a fair tax system that addresses the challenges of a global economy and promoting policies to combat the harmful impacts of corrupt financial practices.[1]
The final conference bill would move the country to a territorial tax system. The primary goal of a territorial system is to permit offshore corporate profits to escape U.S. tax. Taxpayers already lose an estimated $100 billion every year to aggressive tax avoidance by multinational companies.[2] These changes would further incentivize corporate profit shifting abroad — leaving regular taxpayers to pick up the tab.[3]
This is an item from Sara Fischer writing in the Axios Media Trends Newsletter.
Why it matters: Multi-billion-dollar deals — along with regulatory changes such as the repeal of net neutrality rules — are often justified as ways to spur innovation and increase consumer choice, but consumer advocates argue the actions could actually make access to some popular content more expensive. The real question: Is choice at the expense of price really giving consumers what they want?
Those of us who have been around the block a few times know a couple of things. 1) Big companies don’t really innovate—they acquire smaller innovative companies to develop their portfolios. 2) Industry consolidation (mergers) occur during a period when innovation runs out of energy and companies are beginning to fail. What we’re waiting for is the new innovation area.
Climate, Environment, Business
As politicians debate political theory—most likely with an eye toward electoral votes—regarding environmental policy, businesses have long ago discovered that a sound environmental policy reduces costs and improves operations. Try this item from Axios Generate’s Ben Geman.
Coal and climate tussle: Mining giant BHP said Tuesday that it plans to abandon the World Coal Association, and may also leave the U.S. Chamber of Commerce over differences on climate policy, including the Chamber’s opposition to pricing carbon and its attacks on the Paris climate deal. BHP’s newly published review of its membership in trade associations is here. Quick take, via the Financial Times: “The move reflects the growing importance of environmental, social and governance standards within multinationals, which want to protect their brands and insulate themselves from threats posed by activists and consumer boycotts.”
Just for fun.
Here’s one Fun Thing gleaned from the latest Axios newsletter.
Listening to Mozart is said to raise your IQ. Does playing his music make you a better employee? AP’s David McHugh answers from Frankfurt:
- “Definitely so, say many global companies and their workers, above all in Germany and Asia, where accountants, engineers, sales reps and computer specialists bring violins, cellos, oboes and trombones and gather in their spare time to rehearse and perform lengthy, complex pieces of classical music.”
- “A conspicuous number of big German corporate names — along with a handful in Japan and Korea — have their own company-linked symphony orchestra.”
- Why it matters: “The orchestras serve as public relations tools, playing charity concerts and livening up corporate events. … [And] a symphony orchestra is an excellent model for the creative teamwork companies need to compete.”
Well, we have the people from Emerson Automation playing rock and roll at every Exchange these days. Time to pick up that guitar again.
by Gary Mintchell | Nov 9, 2017 | Automation, News, Podcast
Here is another podcast. You can subscribe on iTunes or other podcast services. If you like them, please “like” or review on iTunes. I also record these on video and post to my YouTube channel. You can subscribe there, also.
This podcast recaps several of my recent travels.
- Everybody talks about “digital transformation”; I wonder what it is, really
- Dell makes a $1 Billion bet on IoT
- GE Digital—what’s Predix and what are they really up to
- Emerson attempt to acquire Rockwell—people wonder why it was made public now
by Gary Mintchell | Jan 12, 2016 | Automation, Internet of Things, Networking, News, Operations Management
Business around the Industrial Internet of Things must be maturing. I just received news of another acquisition. In the case, the acquired company has also been changing itself in response to changing landscape of industrial networking. The Advantech CEO called this a merger, but I think that’s a bit disingenuous. When a $1.2 billion company and a $0.1 billion company come together, well, you can see the picture.
Taiwanese industrial computing manufacturer Advantech announced the completion of its acquisition of privately-held industrial intelligent networking specialist B+B SmartWorx for the US$99.85 million agreement announced November 16.
Ottawa, IL-based B+B will continue to be led by its current management team, operating as Advantech B+B SmartWorx, and will lead Advantech’s new Intelligent Networking Business Sector in developing smart networking products as part of the company’s Global Industrial IoT Business Group.
The two companies’ complementary product lines brought them together often over the last decade to collaborate on industrial connectivity projects, so the combination of the two companies felt natural. The merger creates a $1.3 billion company with approximately 7,600 employees worldwide.
“B+B has undergone a transformation over recent years, acquiring several companies itself and developing technologies that bring ‘intelligence to the network edge’ to address evolving needs in the Industrial IoT (IIoT) market,” said B+B CEO Jerry O’Gorman. “We are pleased to join forces with Advantech, a global leader who shares our strategic view of the future.”
With B+B SmartWorx now a part of its portfolio, Advantech said it aims to accelerate its growth in industrial network connectivity-related products. The company will leverage B+B’s established branding, product lines, engineering teams and sales channels in the U.S., Europe and the Middle East, and it will also begin selling B+B’s device connectivity products, cellular routers, gateways and the Wzzard wireless sensing platform into Asia. Products will retain B+B branding, bolstered by Advantech’s name recognition, and sold as “B+B SmartWorx powered by Advantech.”
Advantech chairman KC Liu explained that Advantech views this acquisition more as a merger, seeing value in all of B+B’s networking products from wired networking and fiber infrastructure to wireless connectivity. “B+B has in particular struck a nerve with its Wzzard wireless sensing system which satisfies enterprise IT’s desire to receive data from the field, and overcomes field OT’s (operational technology) fear of disruption, by creating ‘overlay networks’ that leave existing programming, processes and people in place,” said Liu.
B+B’s Wzzard together with its routers and gateways complement Advantech’s own WISE wireless sensing platform, and company engineers will be developing solutions leveraging the strength of both platforms.
by Gary Mintchell | Aug 4, 2015 | Automation, Motion Control, News
I’m digesting information to write on from the conference I’m at now. But first, an interlude.
News of an interesting acquisition further consolidating the motion control industry comes from a perhaps unlikely source. Omron Corp. has entered into a stock purchase agreement to acquire a 100% stake in Delta Tau Data Systems, Inc. of California. Delta Tau will become a member of the Omron Group. The acquisition is subject to customary conditions to closing. Omron expects the acquisition to close in early September, 2015.
The reason I categorize this as perhaps surprising is that there has been little news coming from Omron automation for a long time. Occasionally there will be some opportunities to meet and learn something. The last time for me was about two years ago.
Omron states the reason for the acquisition as part of a strategy to promote its development of factory automation technology and strengthen its sales capability in the control device business. Through the acquisition Omron aims to reinforce its technology development and engineering capabilities in the field of motion control designed to drive manufacturing equipment. Merging products and technologies of both companies will also enable delivery of optimized motion control solutions globally through combined distribution networks.
