Published every Thursday, The Blue Print recaps the industry’s most intriguing news, unexpected shifts and developing trends that are defining the business and technology landscape.
Associated Press: Justice Dept. files landmark antitrust case against Google
The Justice Department on Tuesday sued Google for antitrust violations, alleging that it abused its dominance in online search and advertising to stifle competition and harm consumers. The lawsuit marks the government’s most significant attempt to protect competition since its groundbreaking case against Microsoft more than 20 years ago. It could be an opening salvo ahead of other major government antitrust actions, given ongoing investigations of major tech companies including Apple, Amazon and Facebook at both the Justice Department and the Federal Trade Commission.
Why It Matters: Google has a stronghold on online search (90%) and advertising, and is quickly moving into other areas. While the company says consumers choose Google, the parent company has made hundreds of acquisitions and now owns the leading browser, mobile OS, maps, and video platform — leading to more questions about monopolistic practices. Google is also making progress in penetrating the enterprise with its cloud and Workspace. Despite the company’s negative press and this antitrust case, consumers will not be racing to competitor search engines such as Bing.
Tags: Justice Department, Google, antitrust, Microsoft, Apple, Amazon, Facebook, Federal Trade Commission
US News & World Report: Russia Grants Expatriate Leaker Edward Snowden Permanent Residency
Edward Snowden, the expatriate intelligence leaker whom President Donald Trump considered granting a pardon earlier this summer, has received an unlimited residency permit in Russia, his lawyer told Russian state news on Thursday. The residency permit for the former National Security Agency contractor was set to expire in April but was extended until June due to the spread of the coronavirus. Snowden applied to renew his permit once self-isolation restrictions were lifted earlier this summer, Russian state news reported.
Why It Matters: While working for NSA contractor Booz Allen Hamilton, Edward leaked classified documents and was charged under the Espionage Act. While his US passport was revoked, he was granted asylum in Russia and is now granted permanent residency. Some consider him a whistleblower while others consider him a traitor but whatever his motivations, many saw this as a threat to national security.
Tags: NSA, CIA, Booz Allen Hamilton, Dell, Cybersecurity, data breach, Russia, Espionage Act
SiliconAngle: The new abnormal: CIOs report a cautious outlook for Q4 tech spending
As we reported in our last update, tech spending overall continues to be significantly muted relative to 2019. We currently project a 4% to 5% decline in 2020 spending and a tepid 2% increase in 2021. Nonetheless, there continue to be bright spots in some sectors and for vendors in an overall challenging market. The best news at the macro level is the rate of tech spending declines are compressing heading into Q4 2020. In other words, sequentially, the spending outlook for Q4 is “less bad” than it was in Q3. IT buyers remain cautious and uncertain based on numerous factors accentuated by the U.S. presidential election and of course the continued situation with the coronavirus. Nonetheless, buyers are adapting to the “New Abnormal” and adjusting business models accordingly. Evidence is seen by the reports from CIOs of a reduction in expected layoffs, hiring freezes and IT project freezes.
Why It Matters: It’s expected there will be less hiring and IT project freezes as well as fewer layoffs. In addition, spending in cloud, automation (especially robotics process automation), containers (especially Kubernetes) and cybersecurity remains strong.
Tags: tech spending, CIO, Enterprise Technology Research
Financial Times: McAfee to raise $620m from IPO
McAfee, the cyber security company whose eponymous founder was recently arrested on tax avoidance charges, priced its shares in the lower half of its initial public offering range despite the hot market for newly listed software companies. Public investors agreed to purchase shares at $20 each, according to people briefed on the discussions, delivering about $620m in proceeds the company plans to mostly put toward its almost $4.8bn debt load. At the offering price, McAfee would command a market capitalisation of about $8.6bn, based on the number of shares outstanding. Existing investors were also prepared to sell more than $100m in shares through the offering.
Why It Matters: While McAfee’s brand value has lost its luster over the years, there is a big opportunity for cybersecurity companies. As remote work due to the pandemic as well as the shift to digital and cloud are creating new vulnerable attack surfaces for cybercriminals. More significant, however, are the numerous IPOs this year in which companies have raised $58.4bn in the US – the biggest in the last 6 years.
Tags: McAfee, IPO, Intel
TechCrunch: Juniper Networks acquires Boston-area AI SD-WAN startup 128 Technology for $450M
Today Juniper Networks announced it was acquiring smart wide area networking startup 128 Technology for $450 million. This marks the second AI-fueled networking company Juniper has acquired in the last year and a half after purchasing Mist Systems in March 2019 for $405 million. With 128 Technology, the company gets more AI SD-WAN technology. SD-WAN is short for software-defined wide area networks, which means networks that cover a wide geographical area such as satellite offices, rather than a network in a defined space. Today, instead of having simply software-defined networking, the newer systems use artificial intelligence to help automate session and policy details as needed, rather than dealing with static policies, which might not fit every situation perfectly.
Why It Matters: Juniper Networks looks to bolster its AI-driven network strategy with its acquisition of 128 Technology, which builds on its acquisition of Mist and Netrounds in an effort to be more relevant in the SD-WAN market. While Mist has been a bright spot, the company’s stock remains relatively flat. Across the industry vendors are enhancing their AI capabilities, which help to simplify and automate network operations and identify revenue opportunities.
Tags: Juniper Networks, acquisition, 128 Technology, SD-WAN, AI, automation
New York Times: Activists Turn Facial Recognition Tools Against the Police
In early September, the City Council in Portland, Ore., met virtually to consider sweeping legislation outlawing the use of facial recognition technology. The bills would not only bar the police from using it to unmask protesters and individuals captured in surveillance imagery; they would also prevent companies and a variety of other organizations from using the software to identify an unknown person. During the time for public comments, a local man, Christopher Howell, said he had concerns about a blanket ban. He gave a surprising reason. “I am involved with developing facial recognition to in fact use on Portland police officers, since they are not identifying themselves to the public,” Mr. Howell said. Over the summer, with the city seized by demonstrations against police violence, leaders of the department had told uniformed officers that they could tape over their name. Mr. Howell wanted to know: Would his use of facial recognition technology become illegal?
Why It Matters: While many tech companies are shutting down facial recognition projects and police departments are banning the use of facial recognition due to concerns around privacy and profiling, the general public is now using it to identify police officers. Why the legality of this is questionable, the debate will continue on the use of facial recognition technology. More importantly, what’s necessary is greater transparency.
Tags: facial recognition, Portland, protestors, police, privacy, Facebook
CRN: Splunk Debuts Observability Suite, Acquires Pair Of Monitoring Tool Startups
Machine data management platform developer Splunk is doubling down on providing monitoring software for IT and DevOps teams, debuting its new Splunk Observability Suite at the company’s virtual conference Tuesday and announcing the acquisition of two companies whose technology will be incorporated into the new suite. Splunk has acquired Plumbr, an Estonia-based developer of application performance monitoring (APM) tools, the company announced on the first day of Splunk .conf20, the company’s virtual customer conference. Splunk has also signed a definitive agreement to buy Rigor, an Atlanta-based developer of digital experience monitoring software. Financial details of the acquisitions were not disclosed.
Why It Matters: While the definition of observability continues to evolve, it’s primary goal is to collect, index, search and analyze data by IT management, DevOps and other teams to monitor, investigate and troubleshoot applications. It not only offers insight into application performance and security but has the potential to help decision making that speeds innovation and enhances the customer experience. The challenge is that while many vendors are introducing observability offerings, the problem that has largely remained unsolved is helping enterprises understand the relationship between everything and turning them into actionable insights. While the acquisitions by Splunk enhances its monitoring capabilities, we’ll have to wait and see how its portfolio evolves to determine if it helps enterprises get the actionable insights companies desire.
Tags: Observability, DevOps, Splunk, Plumbr, Rigor
FierceTelecom: Double-digit cloud revenue growth fuels IBM’s Q3 earnings results
As further validation to split IBM up, Big Blue’s cloud division posted double-digit revenue in the third quarter. Revenue from IBM’s cloud business increased by 19% to $6 billion in Q3, which somewhat offset weakness in other sectors. On Monday’s earnings call, Chief Financial Officer James Kavanaugh said IBM’s full-stack capabilities with Red Hat drove over $24 billion of cloud revenue over the last 12 months, which was up 25%, according to a Seeking Alpha transcript. Earlier this month, IBM CEO Arvind Krishna, who was formerly in charge of IBM’s cloud division, announced it would spin-off its IT infrastructure services unit, which is currently being called “NewCo,” from its high-margin open hybrid cloud and AI solutions that account for more than half its revenue.
Why It Matters: While the pandemic has accelerated digital transformation initiatives as more workloads move to the cloud, IBM’s overall business saw a decline in revenue, especially around NewCo, the spinoff of its infrastructure services unit. But with its lowest earnings in nearly a quarter century, the company’s stock continues to tumble.
Tags: IBM, cloud, Red Hat, Arvind Krishna, NewCo
CNBC: Microsoft sales changes could help it challenge Salesforce in cloud software
Microsoft might finally be ready to compete hard in Salesforce’s core business of customer relationship management (CRM) software, which helps businesses track sales and support.
Microsoft is directing its salespeople to get existing customers to adopt its Dynamics products, a major Microsoft partner indicated to analysts at RBC Capital Markets. RBC didn’t name the partner, but these players typically re-sell Microsoft software, often in conjunction with consulting services, hardware, or other software.The push could lift Microsoft’s Commercial Cloud, a group of cloud products that now represents over one-third of the company’s total revenue. It could also make things harder for Salesforce, despite the fact that Microsoft has had little luck displacing the dominant CRM player after nearly 20 years of efforts.
Why It Matters: Microsoft was working towards buying Saleforce, then outbid them on LinkedIn and collaborated in other areas. Now Microsoft executives are putting pressure on its sales team to encourage sales of Dynamics when customer renewals happen.
Tags: Microsoft, Salesforce, CRM, Dynamics