Who has cash to survive the downturn?
The Financial Times points out that many technology companies are cash-rich and intend to stay so in order to ride out the recession. Apple sits atop nearly $26 billion in cash, while Microsoft keeps $19 billion in its pocket (and is probably grateful that its bid for Yahoo was declined, given how that would have decimated its bank balance).
Surprisingly, IBM is relatively cash-poor, with only $3.3 billion in the bank, and Oracle? Well, let's just say Oracle needs its acquisition strategy to start feeding it fat profits because its bank balance is $700 million underwater.
As for open-source companies, Red Hat holds roughly $677 million in cash, and another $450 million in short-term investments and receivables, which compares favorably to its proprietary peers, when considering the small size of its employee base and funding requirements. Novell is much the same, while Sun Microsystems has more cash on hand but also bigger outlays it must service.
Private open-source companies demonstrate the biggest, if diffuse, saving power. My own company, Alfresco, has much of its venture capital investment dollars still in the bank, allowing us to ride out the recession, while companies such as Hyperic, SugarCRM, and others share this fiscal prudence.
When the recession recedes, and it will, those with cash will be best-positioned to manage their options. For the big technology companies, there will be greater leeway to take risks on research-and-development investments and acquisitions. For the smaller companies like mine, well, we'll have the option to grow at our own pace rather than having to sell to a larger company simply to finance operations.
In this economy, cash brings peace of mind, but it also brings options. Ironically, given that Apple and Microsoft have two of the biggest cash hoards, it may well be that money earned on the desktop will provide these vendors the best options for extending that dominance to the cloud.
Matt Asay brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure. You can follow Matt on Twitter @mjasay. 
and it burns you doesn't it?
Every dark cloud has a silver lining. In this economy, that silver lining is Apple. Too bad their stock price still doesn't reflect it.
Microsoft should learn from Zune and MSN to find new ways to improve their software. First, MS should integrate their MP3 player into their smartphone OS. The gadget world (cell phones, PDAs, mp3 players, etc.) is heading towards convergence. Sooner or later, the MP3 player will be assimilated into cell phones. It's only a matter of time. The device of the future is a smartphone.
"[The future of the Zune] lies in planting the software and online service linked to the player in other devices."
Given that music phones have long since come of age, such a strategy?whereby the Zune is a software platform primarily intended for the multitude of Windows Mobile handsets?would make sense. But for now at least, the standalone Zune seems to have some time left.
Source: http://i.gizmodo.com/5130915/microsoft-denies-reports-that-zune-hardware-isnt-long-for-this-world
- by pentest January 27, 2009 10:36 AM PST
- If MS had succeeded in acquiring Yahoo, they would be sitting on no cash, and their stock would be worth less. They would have been in really big trouble. Serious trouble today.
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(11 Comments)Yet Ballmer, the mastermind behind it isn't standing in line at the unemployment office.