IT Winners and Losers: Wal-Mart, Microsoft, Facebook Up; Bill Gates and Apple (Stock) Down
Winners this week included a Web 2.0 Wal-Mart, a SaaSy Microsoft and a grown-up Facebook. Losers? Apple shareholders, Credit Suisse IT and computer science graduation rates.
By Thomas Wailgum
Which tech vendor had a week to remember—and which had one to forget? Which IT department needs a “do over,” and which exec should be looking for a new job? On Fridays, we chronicle what went right and what went wrong in the IT world during the past week.
An article published this week noted the quiet launch of an authentic, interesting and (relatively) unfiltered blog by Wal-Mart’s merchandise buyers. Called Check Out, the site launched during the 2007 holiday shopping season and has “become a forum for unvarnished rants about gadgets, raves about new video games and advice on selecting environmentally sustainable food,” the article stated. CIO‘s October 2007 article on Wal-Mart noted that the world’s number-one retailer had faltered in the Web 2.0 world (with some infamous efforts) and struggled with new online customer service initiatives. But in 2007, execs seemed to get “religion” on what they should be doing and contracted with social networking consultancy Bazaarvoice. This type of innovation was a long time coming for the retailer, but score one for Wal-Mart.
Microsoft delivered another important and telling announcement on Monday: The world’s biggest software company will begin offering online software services (as opposed to just on-premise software) to “businesses of all sizes” by the end of 2008. The “software plus services” strategy, as Microsoft terms it, has been a long time coming. The acceleration of Microsoft’s software-as-a-service play shows that it’s finally accepted the power and inevitability of the cloud—and also reveals just how big a threat Google really is—though Microsoft Chairman Bill Gates would surely disagree. In a quote for the ages this week, Gates said, in reference to Google’s buzz-worthy product announcements, “to be frank, the day they announce them is their best day.”
LOSER: Bill Gates
Speaking of Gates…the former richest person in the world is now just the third richest person in the world. Gates had held Forbes magazine’s “world’s richest person” title for an incredible 13 years. Supplanting him at the top is his good friend and investor extraordinaire Warren Buffet, with an estimated $62 billion fortune. In second place is the richest-guy-you’ve-never-heard-of: Carlos Slim Helu, a Mexican communications industry honcho, at $60 billion. Poor ‘ole Gates was valued at a paltry $58 billion. Sorry, Bill.
On Tuesday, boy wonder and Facebook CEO Mark Zuckerberg (worth a respectable $1.5 billion on the Forbes list) announced the hiring of a COO. Zuckerberg was able to pry Sheryl Sandberg away from Google (a rare occurrence), where she was the VP for global online sales and operations. (The news sent Google’s shares down 4.2 percent, to a 52-week low.) Sandberg had joined Google in 2001 and championed its AdWords and AdSense programs, which accounted for the overwhelming majority of Google’s $16.6 billion in revenues in 2007, according to a New York Timesarticle. Now a multimillionaire, Sandberg will have a hand in shaping Facebook’s future and helping Zuckerberg figure out how FB will make money. Bet she’s got a lot more “friends” now.
LOSER: Apple Shareholders
Apple CEO Steve Jobs may be looking for some friends after this week: At Apple’s annual meeting of shareholders this week, Jobs announced that the ever-cool company would not buy back its stock or declare a dividend for its shareholders. The move was a bit surprising to some analysts and shareholders, due to Apple’s stockpile of cash and short-term investments that topped $18 billion at the end of 2007, reported the Times. Bummer for the shareholders, but at least they know that they’ve invested in America’s Most Admired Company, which was bestowed upon Apple this week by Fortune.
LOSER: Credit Suisse IT
Last Friday, Credit Suisse quietly announced the departure Tom Sanzone, its CIO since 2005. It turns out Sanzone won’t have to ask his new employer for any help with his moving expenses: He’ll start work in the second half of 2008 at Merrill Lynch as its EVP and chief administrative officer, reporting to Chairman and CEO John Thain. As detailed in this CIOarticle, the 47-year-old Sanzone will have a wide range of new responsibilities: global client services and operations; technology applications development and infrastructure; business process and sourcing strategies; information security; and global real estate, purchasing and services. Credit Suisse’s newly appointed CIO, Karl Landert, has got some big shoes to fill.
LOSER: Computer Science Grad Rates
Over the weekend, the Computing Research Association (CRA) announced that number of computer science grads in the class of 2007 was the smallest in a decade. In the 2006-2007 academic year, just 8,021 students graduated with computer science degrees. When compared with data from 2003-2004, the nosedive in the number of grads is shocking: 14,185 students got their bachelor’s degrees in computer science that May, according to the CRA data. A small ray of hope (emphasis on small) is that the trend may be leveling off. The CRA reported nearly 8,000 new enrollments in last fall.
WINNER: AT&T Business Customers
AT&T announced on Wednesday that it plans on spending $1 billion this year to expand its Internet protocol, or IP, networks for its large business customers. The reason for the investment was what AT&T execs termed an “explosive surge” in data, voice and video traffic. That will be money well spent.