• Financial services firm Merrill Lynch signed a 25,000-user deal with on-demand customer relationship management provider Salesforce.com. The deal is Salesforce.com’s largest to date and as such is a significant endorsement of the software-as-a-service model. The on-demand model has historically been seen as only appropriate for small implementations of relatively unsophisticated vanilla applications.
•  Search giant Google launched an enterprise version of its online applications bundle, Google Apps Premier Edition in a move that encroaches further on rival Microsoft’s territory. Email will be offered through Google’s GMail service, tailored to include the customers’ domain name and support for mobile devices such as the BlackBerry, and will be offered alongside Google Calendar, word processing through Google Docs and Google Spreadsheets, all for $50 per user per year.
•  The US Department of Justice revealed details of a case in which a scientist at US chemicals and health care giant DuPont leaked intellectual property worth $400 million. The perpetrator was discovered through analysis of document libraries – his was 15 times larger than average. The information would have been highly prized by DuPont’s rivals.
•  Swiss investment bank Credit Suisse is to outsource its global networking infrastructure to BT, in a five-year deal worth £578 million, and will involve the transfer of 231 of the bank's employees and 50 contractors. Credit Suisse said it hopes the move will help reduce latency and improve trader efficiency, while enhancing collaboration in its investment banking activities.
•  Vodafone acquired the controlling stake in India’s fourth largest mobile operator company, Hutchison Essar, in a deal worth $11.1 billion. Vodafone’s CEO described the deal as an “excellent investment” as the Indian mobile phone market is expected to grow to from 150 to 500 million subscribers by 2010, however some critics believe Vodafone has paid too much for the company.
•  Storage, security and information management giant EMC will spin off a 10% stake in its fast-growing virtualisation software unit, VMware. EMC chairman, president and CEO Joe Tucci said the move, expected to occur by September, will “unlock more of VMware’s value for EMC shareholders”. EMC acquired VMware in 2004 for $625 million and reported revenue of $709 million in 2006, a 83% increase from 2005.
•  Pharmaceutical firm Pfizer announced plans to outsource the ongoing development of thousands of its internal applications to Indian IT services company Satyam. The initial pilot enabled the company to build a uniform systems software stack on which the majority of applications will eventually run. That consistency of standard operating system, database and middleware should ease support, maintenance and portability.
•  Two of the UK’s leading payment services companies, Voca and Link Interchange Network are to merge, creating one of the largest payment processing companies in Europe. VocaLink, which will process over 8 billion transactions during this year alone, is gearing up for the arrival of the Single Euro Payments Area (SEPA) in 2008.

Infoconomy Index: Approaching double figures

The IT industry’s growth rate looks on course for double figures for the first time in two years.

The Infoconomy Global Index, which tracks the growth picture at the world’s 200 largest technology companies, rose 0.5% in February to hit 9.8%. That was despite the fact that the performance of a subset of 50 European companies in the Index dropped back from 10.2% to 9.3% over the month.

The biggest influence on the upswing came from strong numbers at two industry giants: Cisco and Hewlett-Packard. The networking giant turned in a stunning 27% rise in quarterly revenues, while HP topped the industry par for the first time in many quarters with 11% growth. Other fast-growers included data analysis and reporting software vendor Business Objects, where growth was 22%, Indian offshore services company Cognizant, which generated a stunning 65% lift in revenues, and storage systems maker Network Appliance, with a 36% jump in sales.

At the same time, several previously weak US IT services were rising fast again – Perot’s growth accelerated to 14% and EDS resurged with a highly respectable 11%.

In contrast, some of their rivals in IT services were pulling the Index’s in the opposite direction. Computer Sciences Corp’s showed a 2% increase in revenues, while Finland’s TietoEnator mustered 5%.

Nevertheless, the Index shows every sign of crossing the 10% threshold next month.

The Infoconomy 200 Index measures the overall growth rate of the IT industry by tracking the financial results of the world’s most important publicly listed IT companies. for more details, go to www.information-age.com.