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Showing posts with label DELL. Show all posts
Showing posts with label DELL. Show all posts

Saturday, January 11, 2014

PCs Mark Steepest Drop in 2013, Lenovo maintained the No. 1



Personal-computer shipments fell 10 percent in 2013, marking the worst-ever decline after lackluster holiday sales underscored how consumers and businesses are shunning machines for mobile devices, two research firms said.

Manufacturers shipped 315.9 million units, returning to 2009 levels and making it the “worst decline in PC market history,” researcher Gartner Inc. said in a statement yesterday. IDC also said shipments had a record decline.

U.S. consumers omitted PCs from their holiday shopping lists while buyers in Asia opted for smartphones and tablets. More computing tasks are moving to websites and applications tailored for wireless gadgets, rather than software installed on laptops and desktops. The annual drop eclipsed the previous record decline of 3.9 percent in 2012, Gartner said.

“Consumer spending during the holidays did not come back to PCs as tablets were one of the hottest holiday items,” said Mikako Kitagawa, an analyst at Stamford, Connecticut-based Gartner. “In emerging markets, the first connected device for consumers is most likely a smartphone, and their first computing device is a tablet.”

Global sales fell 6.9 percent in the fourth quarter -- the seventh straight drop -- to 82.6 million units, Gartner said. IDC, based in Framingham, Massachusetts, reported a decline of 5.6 percent in the same period.

Corporate Upgrades

Lenovo Group Ltd. (996) maintained the No. 1 spot worldwide with 18.1 percent market share in the fourth quarter, helped by a 6.6 percent increase in shipments, according to Gartner. Hewlett-Packard Co. (HPQ) was second with a 16.4 percent share as shipments declined 7.2 percent. Dell Inc. was third, the researcher said.

“We are extremely optimistic about the future of the $200 billion-plus PC industry,” Yang Yuanqing, Lenovo’s chairman and chief executive officer, said in a statement. “We continue to outperform the market while steadily improving profit and margin.”

Lenovo shipped 14 million PCs in the last quarter, it said.

Growth in the PC market has become dependent on consumers and businesses replacing existing machines, rather than wooing new buyers. Enterprise demand is being driven in part by Microsoft Corp. (MSFT)’s plan to end support for its 13-year-old Windows XP operating system in April, compelling businesses to buy new PCs along with software upgrades.

U.S. shipments shrank 7.5 percent in the fourth quarter to 15.8 million units, Gartner said. Unit sales in Europe, the Middle East and Africa fell 6.7 percent to 25.8 million, while the Asia-Pacific region saw a 9.8 percent decline to 26.5 million.

Loren Loverde, an analyst at IDC, said the decline in PC shipments was the worst since the researcher started tracking data in 1981, with the previous record seen in 2001, when sales shrank 3.7 percent.

“We don’t think it’s quite the bottom yet,” Loverde said. IDC is predicting a 3.8 percent decline in PC shipments for 2014 this year, and then growth of less than 1 percent in 2015, he said.

Contributed  By Aaron Ricadela - Bloomberg

Friday, July 12, 2013

China's Lenovo overtakes HP as global No 1 PC maker


PALO ALTO (CBS/AP) – Lenovo beat out rival Hewlett-Packard to become the No. 1 PC maker by a narrow margin, according to both firms.

In the Asia/Pacific (excluding Japan) region overall PC shipments in the region fell slightly below forecast due to China. Weak sell-in to China during April and May constrained shipments. Although June shipments in China improved, expectations for the third quarter are being lowered to reflect remaining inventory as well as economic pressures.



Worldwide shipments of personal computers fell 11 percent in the April-June period, according to data from research firms Gartner and IDC, as people continued to migrate to tablets and other mobile devices.

Gartner Inc. said Wednesday that the PC industry is now experiencing the longest decline in its history, as shipments dropped for the fifth consecutive quarter. Computer makers shipped 76 million PCs in the April-June period, down from 85 million in the same  three months of 2012, according to Gartner.

International Data Corp., which uses slightly different methodology, essentially came to the same conclusion, though it noted that the decline was slightly smaller than expected.

“With second quarter growth so close to forecast, we are still looking for some improvement in growth during the second half of the year,” said Jay Chou, senior analyst at IDC, in a statement. “Slower growth in Europe and China reflect the risks, while the improved U.S. outlook reflects potential improvement.”

Gartner’s Mikako Kitagawa said inexpensive tablets are displacing low-end computers in “mature” markets such as the United States. In emerging markets like China, meanwhile “inexpensive tablets have become the first computing device for many people, who at best are deferring the purchase of a PC. This is also accounting for the collapse of the mini notebook market,” she added.

IDC said the numbers “reflect a market that is still struggling with the transition to touch-based systems running Windows 8.”  Microsoft Corp.’s latest operating system launched in October and sales have disappointed analysts. But Kitagawa said that while “Windows 8 has been blamed by some as the reason for the PC market’s decline, we believe this is unfounded as it does not explain the sustained decline in PC shipments.”  - CBS, AP, AFP

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Saturday, October 1, 2011

CEO, the Least Popular Job in Silicon Valley





Potential CEOs are opting for quicker dollars at startups and investment firms

 
Illustration by Sophia Martineck
By

Dave DeWalt is known within Silicon Valley for his technical chops, his charisma, and his business accomplishments, which include reinvigorating security software maker McAfee and selling it to Intel (INTC) in 2010 for $7.7 billion. At 47, he now has bigger ambitions. “Running a big-cap company is considered the crowning achievement in many people’s careers, and I feel that way as well,” says DeWalt.

Such talk makes DeWalt an anomaly. In tech circles, the C-suite at a publicly traded company is no longer the be-all and end-all. Just look at the troubles Yahoo! (YHOO) and Hewlett-Packard (HPQ) have recently had finding new leaders. HP canned former SAP (SAP) Chief Executive Officer Léo Apotheker after just 11 months—then faced a barrage of criticism for replacing him with HP director and former EBay (EBAY) CEO Meg Whitman without bothering to look beyond its own boardroom.

Industry consolidation has created a small number of very large technology companies such as HP, Cisco (CSCO), and Microsoft (MSFT). They’ve stumbled in recent years as disruptive developments like the mobile revolution and the dash to the cloud shake the entire sector. As the job of leading these companies gets tougher, there are fewer talented leaders with the skills—and inclination—to do it. Rather than wait for high-profile CEOs such as Cisco’s John Chambers, Microsoft’s Steve Ballmer, and Research In Motion’s (RIMM) Mike Lazaridis and Jim Balsillie to step down, many potential replacements have decamped for more exciting, and potentially more lucrative, gigs at startups or as investors. “This is the first time in tech history that you have this many companies with CEOs approaching 60 that don’t have any obvious successors,” says John Thompson, vice-chairman of recruiting firm Heidrick & Struggles (HSII).



Consider Cisco. With 62-year-old Chambers now in his 16th year as CEO, many of his most capable lieutenants have given up waiting for their chance to succeed him. The list of departures since 2007 includes former Chief Development Officer Charles Giancarlo (now a private equity partner at Silver Lake), longtime general manager Tony Bates (who jumped to Skype just before it was purchased by Microsoft in May), and former head of the data center business Jayshree Ullal (now CEO of Arista Networks). While the accomplishments of Chambers and other longtime CEOs including Ballmer are undeniable, their long tenure has sapped the strength of the back bench, says Heidrick’s Thompson. Now a common belief is that both companies will need to go outside for their next CEO—not an easy task when the competition for talent includes hot pre-IPO companies such as Facebook. “The people who could possibly do these jobs realize it would be easier to create a new company rather than try to get an old stodgy one to adopt new ideas,” says Trip Hawkins, CEO of game developer Digital Chocolate.

Boards of directors get low marks on recruitment and retention, too. Few give much attention to succession planning until crisis hits, says Jeffrey A. Sonnenfeld, senior associate dean of the Yale University School of Management. New hires such as Bartz and Apotheker are set up for failure as boards prioritize near-term earnings over long-term risk-taking. “We’ve been weeding the qualified people out of the system for the past 15 years,” says Roger McNamee, a longtime technology investor and co-founder of private equity firm Elevation Partners.

Nor have tech companies excelled at developing CEOs. Once executives prove themselves in a given area—say, software engineering—they rarely go through General Electric (GE) -style development programs to get exposure to a business’s full breadth. There are exceptions: Intel and IBM (IBM) are both organized so that top executives get to run multibillion-dollar business units. IBM Senior Vice-President Michael E. Daniels, for instance, runs the $56 billion services business. At Intel, young executives have an apprentice system where they shadow top executives (current CEO Paul S. Otellini spent years carrying Andy Grove’s bags). As a result, both companies have succeeded at finding internal candidates for the top job. But this is not the norm in Silicon Valley, where most companies are organized along strictly functional lines such as marketing. “The tech industry is great at producing technology, but it’s not producing leaders,” says Rosabeth Moss Kanter, a professor of administration at Harvard.

To break the cycle, some tech industry veterans say it’s time for a new approach to choosing CEOs. Forget the old idea of finding an older, well-known operations or sales executive to maximize earnings and soothe nervous shareholders. Too often, those experiments—Dell’s (DELL) Kevin Rollins, Apple’s (AAPL) John Sculley, Yahoo’s Carol Bartz—have failed, says McNamee. Now Old Guard tech companies need to find risk-takers willing to bet big on new visions. That’s hard enough for entrepreneurs such as Amazon.com’s (AMZN) Jeff Bezos. It may be even harder at companies settling into middle age.“Somebody is going to have to take some risks, and bring in younger CEOs for a while,” says McNamee.

To find them, some boards are taking a larger role in succession planning. Egon Zehnder International has been testing a new approach for two years, in which board members use a number of techniques such as mentorship programs to groom internal candidates, says Karena Strella, managing director of the firm’s U.S. unit. The goal is to take some focus off past accomplishments and identify impassioned, adaptable people. Then it’s up to the board to back them, says Thompson. “People forget that it took Steve Jobs seven years to really move the needle at Apple,” he says. “If you used that standard today, he would have been fired long ago.”

The bottom line: Shortsighted boards and the long tenure of some CEOs have led to a succession crisis at big-cap tech companies.

Burrows is a senior writer for Bloomberg Businessweek, based in San Francisco.

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Sunday, February 14, 2010

The New Generation Leaving Ireland, now rated to junk by Moody




Some 170,000 jobs vanished last year, and the lack of employment is driving a generation away

http://images.businessweek.com/mz/10/08/600/1008_mz_50ireland.jpg "The lack of jobs is driving people away," says Trinity College senior Simon Phelan Jude Edginton
Dublin - When Simon Phelan started a civil engineering degree at Dublin's Trinity College four years ago, he figured his biggest problem upon graduation would be deciding which job to choose. Ireland's economy was growing at 5.4%, unemployment was a mere 4.4%, and construction was booming.

Today, with graduation fast approaching, only two of Phelan's 100 classmates have even had interviews. Worse, in these recession-scarred times, just two people from the class ahead of him are employed. So Phelan and many contemporaries see emigration as the only option. "The lack of jobs is driving people away," the 20-year-old Dubliner says after trawling through the meager offerings at Trinity's career office, a small building tucked off the school's cobblestoned quadrangle. "Ireland will lose a whole generation of graduates."

It's a scenario most Irish thought had gone the way of the potato famine and two-shilling pints of Guinness. Two decades of prosperity had transformed the island nation of 4.5 million from a European laggard into the so-called Celtic Tiger. After a century and a half in which Ireland's young and energetic routinely fled to South Boston or London's Kilburn, today's twentysomethings grew up expecting to live and work at home. But with one in three males under age 25 out of work, their confidence seems to have been misplaced. "It used to be employers were fighting over graduates," says Shane King, a 22-year-old Trinity senior from County Mayo on Ireland's west coast. "Now graduates are fighting each other for jobs."

The country's budget swung from a surplus in 2007 to a deficit of nearly 12% of gross domestic product last year as the economy shrank by 7.5%. A decade-long property bubble, which saw real estate prices triple, led to a banking crisis that Standard & Poor's estimates could cost taxpayers as much as $34 billion. "Everything we have is being spent on the banks," says David Begg, head of the Irish Congress of Trade Unions.

Drive the 10 miles from central Dublin to Citywest, an industrial park near the border of County Kildare, and you'll see ample evidence of overbuilding. On the banks of the Liffey River, there's the half-finished shell of Anglo Irish Bank's new headquarters. Farther on, "for sale" signs dot posh developments where new homes stand unoccupied.

AUSTRALIA BOUND?

Many would-be emigrants have made the same trip. On a chilly Sunday, hundreds of people gather in a conference room at the Citywest Hotel for a seminar on emigrating Down Under. Representatives of several Aussie states sit behind foldable tables stacked with pamphlets extolling Australia's low unemployment and "no worries" outlook. Carpenter Michael McGerr, 38, drove more than 100 miles with his wife and toddler to attend. "Our goal is to go away for good," he says.

Last year emigration exceeded immigration for the first time in 15 years as 65,100 people left, outpacing arrivals by nearly 8,000. Almost half of those who decamped were recent immigrants from Eastern Europe. But with few opportunities at home, growing numbers of native Irish are also headed for the exit. "There was loads of work three years ago, then it just dried up," says Patrick Maye, an unemployed bricklayer who traveled to the Aussie seminar from Carlow, some 50 miles south of Dublin. The 22-year-old hopes to move to Australia once he finishes retraining as a fitness instructor.

With unemployment set to hit 13.8% this year, things are sure to get worse. The Economic & Social Research Institute (ESRI), an independent think tank in Dublin, predicts net outward migration of 40,000 for the year ending in April, the highest level in more than 20 years. "We are right back to the 1980s," says Piaras Mac Éinrí, a lecturer at University College Cork.

Back then, unemployment soared to 18% as the economy took a dive. Then in the 1990s, a wave of foreign investment swept Ireland, lured by low corporate taxes and inexpensive workers. Now the blue chips are scaling way back. In the past year, Intel (INTC), Royal Bank of Scotland (RBS), and Waterford Wedgwood have downsized; Dell (DELL) moved PC production from Limerick to lower-wage Poland; and some 1,500 smaller companies have folded. Last year 170,000 Irish jobs vanished, and ESRI predicts 76,000 more will be lost in 2010.

One problem is that Ireland got too pricey. The American Chamber of Commerce Ireland estimates that from 2004 to 2008, Irish wages rose 50% faster than the average of advanced European economies. Former Intel Chairman Craig R. Barrett says that of the 14 reasons Intel came to Ireland two decades ago, only one remained: a low corporate tax rate of 12.5%. "Ireland needs a new game plan," he said at a Dublin conference in September.

In the past, the state has been a big creator of jobs by hiring civil servants and promoting investment. But to plug a yawning gap in public finances, Dublin in December announced spending cuts of $5.6 billion, including $1.4 billion from public sector pay and $1.1 billion from social welfare benefits. The tough measures have helped restore Ireland's standing among global investors, but the cuts make it difficult for the government to launch the policies that might enable people to ride out the recession, either in on-the-job training or higher education.

The biggest job casualties have been in construction. At its peak in 2007, the building trade employed 1 in 7 Irish workers. But over the past two years, the sector has shed 200,000 jobs, according to Ireland's Construction Industry Federation. "We went from being in high demand to no demand," says Gordon Cobbe, a construction manager from Cork. Out of work for a year, he plans on moving to Perth, Australia.

Many Irish aiming to get out face problems similar to workers in, say, Detroit or Toledo: They can't afford to leave their homes. John McKenna is eager to join more than a dozen friends who have moved to Australia. With business slow at the plumbing supply store where he works, "I don't know how much longer I'll have a job," the 39-year-old says. But the house he bought for $306,000 in 2006 has halved in value, so it'll be tough to depart anytime soon.

The emigration surge comes as Dublin tries to implement a program called "Smart Economy." The plan is to boost innovation through tax breaks for research, expedited visa processing for skilled workers, a $689 million fund to back promising tech startups, and other incentives. The glue holding it all together, the government says, is "the knowledge, skills, and creativity" of the Irish—a problem with so many people leaving. "There is a risk that many of the talented individuals envisioned as the foundation of the innovation economy will make their careers elsewhere," says John McHale, an economics professor at the National University of Ireland, Galway.

Other economists are more optimistic. Alan Barrett, a research professor at ESRI, says the current exodus is likely to be benign. As part of the EU, Ireland will again lure immigrants from across Europe as growth picks up. And he points out that many who left in the '80s returned with better skills. "As soon as the economy recovered, people came back in droves," he says.

Kevin Carey, CEO of moving company Careline International, can attest to that. His firm helped relocate emigrants in the 1980s before bringing many back a decade later. Now most of his work is again outbound, and business was up 23% last year. His customers weren't so lucky. "They're all leaving; the cost of living here is too high," says Carey, who was manning a table at the Australian emigration event at the Citywest Hotel. For him, at least, business was good.
 
Source: Capell, Capell is a senior writer in BusinessWeek's London bureau .



Moody's cuts Ireland to junk, warns of second bailout

 A protestor waves a tri-color flag outside Government Buildings in Dublin November 24, 2010. REUTERS/Cathal McNaughton

NEW YORK/DUBLIN | Tue Jul 12, 2011 7:29pm EDT

Reuters) - Moody's cut Ireland's credit rating to junk on Tuesday, warning that the debt-laden country would likely need a second bailout -- just the latest move amid heightening concerns about Europe's ability to address its debt crisis and prevent it from spreading.

Moody's move comes a week after it slashed Portugal to junk status with a similar warning about the need for a second round of rescue funds. It reflects the credit rating agency's view that any further financial assistance from Brussels will require private investors to share part of the pain, possibly through a debt rollover or swap.

European finance ministers have acknowledged for the first time that some form of Greek default may be needed to cut Athens' debts, and if that materializes, Ireland's rating, never before in junk territory, could be set for a further round of cuts.

Investors fear a Greece default could ripple through Europe's banking system, putting pressure on stretched public finances in other euro zone countries. Italy, the euro zone's third largest economy, looks especially vulnerable with a debt-to-output ratio second only to Greece, and markets fear political bickering may derail a plan to slash spending and rein in the deficit.

Moody's one-notch downgrade on Ireland weighed on stocks and the euro, which hit its lowest level against the dollar in four months.

The Irish government, which wants to return to debt markets in 2013 when its current EU-IMF bailout runs out, offered a vexed response.

"This is a disappointing development and it is completely at odds with the recent views of other rating agencies," the finance ministry said in a statement. "We are doing all that we can to put our house in order and the progress that we are making is there for all to see."

Moody's now rates Ireland Ba1, one notch below former financial market pariah Colombia and two notches below Brazil, and has kept a negative outlook, meaning further downgrades are likely in the next 12 to 18 months.

Ireland's rating is still one notch above Portugal and six above Greece. Both Standard & Poor's and Fitch Ratings have Ireland at BBB-plus, three notches above junk status, with S&P's outlook stable and Fitch on outlook negative meaning it does not expect a downgrade in the short-term.

Moody's move, however, will likely put pressure on the other ratings as the downgrade forces some investors to dump Irish bonds because they no longer enjoy a clean investment-grade sweep of the three major ratings agencies.

"It's amazing to me that Ireland was still investment grade," said Suvrat Prakash, interest rate strategist at BNP Paribas in New York.

"A lot of people assume that these rating agencies tend to move with a lag so there could be more downgrades to come.

Ireland's borrowing costs are already at levels once thought unimaginable, with five-year paper yielding over 15 percent on the secondary market and 10-year paper close to euro-era highs of 13.86 percent.

When Ireland agreed an 85 billion euros ($119 billion) bailout package with the European Union and the International Monetary Fund last November -- a move designed to soothe market fears -- its 10-year paper was yielding around 9.5 percent, a level viewed as shocking at the time.

Economic growth in the European region as a whole has been sluggish, as a number of nations have struggled with mounting debt costs and have had to pass harsh austerity plans that have slowed economic growth further, creating a vicious cycle where tax revenues drop, reducing their chances of repaying the debt even more.

But the more investors fear that heavily indebted euro zone governments will be unable to repay their debts, the more the yields on their bonds rise, dragging down their value in banks' balance sheets, erasing their capital, and increasing the need for yet more bank bailout's by stronger euro zone governments.

A CORK BOBBING IN THE OCEAN

Unlike Greece, Ireland is meeting its bailout targets and Irish officials have felt frustrated at how their efforts have been swept aside by events in Athens.

An agreement by the euro zone finance ministers, known as the Eurogroup, late on Monday to cut the interest rate for countries borrowing from their rescue fund and an agreement to make the fund more flexible and extend its loan maturities was hailed by Dublin as helping it return to debt markets.

The finance ministry said Moody's move appeared not to reflect the Eurogroup developments, but Moody's analyst Dietmar Hornung said the risk of private sector participation in any future bailout meant investors would be put off lending fresh funds to Ireland.

Hornung, in an interview with Reuters, warned over the risks even though Moody's is confident the euro zone is "willing to continue to provide liquidity support for peripheral countries and give them time to achieve a sustainable financial position.

"But at the same time we see a growing possibility that, as a precondition of additional rounds of liquidity support here, private-sector creditors participation will be required," he said.

Ireland's debt management agency said on Tuesday the country was fully funded until the end of 2013. Ireland has a financing requirement of nearly 34 billion euros over 2014 and 2015, based on estimated deficits and maturing debts.

Even before Moody's downgrade, Finance Minister Michael Noonan admitted Dublin was at the mercy of the markets.

"Ireland is a cork bobbing on a very turbulent ocean at present," he told state broadcaster RTE on Tuesday.

Officials from the EU, the IMF and the European Central Bank are expected to confirm Dublin is meeting all its bailout targets in their latest quarterly review, expected on Thursday.

But Ireland's weak domestic economy is hitting spending-related tax revenues, and Moody's warned that another downgrade would be considered if the government can't meet its fiscal consolidation goals.

(Reporting by Walter Brandimaret and Carmel Crimmins; Additional reporting by Daniel Bases; Writing by Carmel Crimmins; Editing by Leslie Adler)