This week has been one of tech winners and losers — or at least big announcements where it’s too early to predict the effects.
Yesterday HP announced another 15,000 job cuts — on top of the tens of thousands already cut since CEO Meg Whitman took the reins in 2012 — a move which the company says addresses an opportunity to trim costs, not because of a forecast decline in demand.
HP appears to be stabilizing, with Whitman suggesting "the high single-digit declines are over," but some analysts are not as confident. According to the AP, analysts worry that the company's recent good fortune, especially in a recovering market for personal computers, might be short-lived. The company acknowledged that Microsoft Corp.'s end of support for its nearly 13-year-old Windows XP operating system in April had boosted corporate demand for PCs, especially in Japan.
"The part I would worry about is: Do PCs get back to declining once XP's benefit is behind you?" said Amit Daryanani, an analyst with RBC Capital Markets. "Is it truly from opportunities they found or is it ahead of an air pocket in demand?"
In other big tech news, Microsoft unveiled the Surface Pro 3 tablet at an event on Tuesday, saying the goal of the device is to "take away the conflict" between owning a laptop and a tablet. David Pogue of Yahoo Tech called the Microsoft Surface either brilliant or doomed. Citing the “flop” of the first two iterations of this product, Pogue relents that the version 3 is actually pretty smart and versatile. Says Pogue, “If you own or carry around both a tablet and a laptop, then the Surface is calling out your name. There’s nothing like it. If this marvel of engineering doesn’t lift the Microsoft hardware curse, I don’t know what its designers are supposed to do.”
Meanwhile on the business front, the rising stars of the tech sector point to technologies that are gaining an increasing foothold in consumer applications as well. According to the latest report by the audit, tax and advisory firm KPMG LLP, revenues for technologies like Cloud and Mobile are exceeding forecasts. The industry leaders also expect data and analytics (D&A) to be the top revenue growth driver over the next two years, as their expectations have skyrocketed.
"We are witnessing a convergence of technologies and business opportunity that is producing a flood of revenue in Cloud and Mobile," says Gary Matuszak, Global Chair, KPMG Technology, Media and Telecommunications practice. "Also, technology companies are leveraging Cloud to transform their business to become more efficient, smarter and flexible."
Significantly, says the report, many more respondents believe D&A will be the biggest revenue growth driver for their companies in the next 24 months compared to previous surveys. D&A leaped to the top of the list with 51 percent in the 2014 survey, compared to 33 percent in 2013, and 19 percent two years ago. Mobile (41 percent) and Cloud (40 percent) are projected to be the next biggest revenue drivers, followed by security (28 percent), Internet of Things (19 percent), and Consumerization of IT (19 percent).
Interestingly, the report identifies the need to innovate, disruptive technologies and lack of visionary leaders among the top risks to a tech company's growth. More than two-thirds of the tech executives cite the speed of the economic recovery, with slowing growth in international markets (38 percent), disruptive technologies (36 percent) and the inability to find visionary leadership (28 percent) rounding out the top four risks.
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