RESEARCH TRIANGLE PARK — Even as some magazines and media outlets warn that another “tech bubble” has emerged and is ready to pop, analyst firm Gartner, Inc. says 2004 is shaping up to be a great year.
“Gartner is telling you a big turn is coming,” said Michael Fleisher, the chairman and chief executive officer of the analyst firm, told Gartner’s annual symposium last week. “2004 will be the year that companies make the turn from protecting profitability to driving growth.”
Not that the free-spending tech boon days are back. But Gartner says a three-year tech downturn is ending with computer services and wireless investments on the increase, Over the next three years, Gartner is predicting that tech spending will increase 5 percent with software jumping 7 percent.
IBM recently said it expected to hire 10,000 people. Does Gartner’s prediction mean other firms will be hiring? Yes — but not necessarily in the USA.
Garnter predicts that 25 percent of tech jobs will be outsourced or created in developing nations by 2008.
The firm’s own “technology demand indocator index” also remains lukewarm. “The September Gartner TDI for current IT demand is at 87, indicating a slight recovery from August, but has not returned to highs in the 90s experienced in May through July,” Gartner says.
But the TDI adds: “Gartner anticipates that the economy will continue to improve but that IT investment will not begin to grow until the beginning of 2004. We expect this growth will be signaled by a leap in the IT Watch index in November or December.”
For a look into Gartner’s crystal ball, visit:
Room for Cisco in SAN markets?
When Cisco discusses its quarterly earnings next week, a topic of discussion could be the firm’s aggressive moves into storage area networks. Cisco’s recent announcement of a software deal for SANs with IBM is just the latest in a series of aggressive moves the networking giant is making in that sector.
A NewsFactor story takes a look at the already crowded SAN market, which Cisco sees as an area of growth beyond its voice over IP, firewall and home networking moves. Cisco already dominates the IP routing and switching market.
Meta Group analyst David Willis asked NewsFactor: “Where do you grow from there?”
“But in the market for storage area network (SAN) switches, which Cisco entered in 2001, there already are entrenched vendors,” NewsFactor says. “Brocade holds down the low end and McData dominates the high end.
For details, see:
story.news.yahoo.com/news?tmpl=story&u=/nf/20031024/bs_nf/22553
Concerns about Cree —
Zeke Ashton, writing in the Motley Fool, isn’t too keen on Cree stock.
“I’m not worried about an Enron-type scenario with Cree, but there isn’t a margin of safety within a mile of this stock,” Ashton writes. “Stocks with this type of baggage usually come with a bargain price, but Cree investors are paying full fare and then some. Investing is a probability game, and I don’t like the odds on this one.”
Ashton points to a one-time revenue bounce that helped Cree meet Wall Street’s most recent earnings expectations and a conference call during which a line of questioning was terminated by Cree.
Cree will have its annual shareholders meeting on Tuesday beginning at 10 AM. You can tune in to the web case at Cree’s web site.
For Ashton’s story see:
www.fool.com/news/commentary/2003/commentary031024za.htm?source=eptyholnk303100&logvisit=y&npu=y
Analysts pan BellSouth bid for AT&T
The Wall Street Journal reports again today that BellSouth remains hot on the idea of acquiring AT&T. The regional Bell operating company has a huge appetite for expanding its long distance offerings nationally since AT&T is the largest provider of such services. But this isn’t a new idea. The companies have talked before, and The WSJ says a marriage has come very close on more than one occasion.
But note what some analysts saying.
“”I don’t understand what the urgency is,” Brian Adamik of Yankee Group, a Boston consulting firm, told The WSJ. Added Lehman Brothers’ Blake Bath: “This is the dumbest idea I’ve ever heard for BellSouth.”
By the way, The WSJ also points out AT&T has reported a decline in revenue for 15 consecutive quarters. Long-distance is a cut-throat businesses, and when MCI emerges from bankruptcy — the blood will flow even more freely.
Grid computing ready for prime time?
Details of a new study about grid computing and the potential $10 billion impact on North Carolina’s economy will be disclosed on Wednesday. The Rural Internet Access Authority is the driver behind the in-depth look.
We can’t talk about its details. But if you want to read up on grid’s potential, a story from Datamonitor provides an overview.
“For decades, there has been talk of technology that can optimize processes and even heal itself, but ‘artificial intelligence’ and ‘artificial life’ never quite managed to live up to their hype,” the story says. “Now, eyes are turning to ‘grid computing’ to meet these goals – but can the latest technology finally turn fiction into reality?”
Fro details, see:
