Microsoft Dismissing Rumors
May 13, 2009
Investment mavens love buy out rumors. Chatter causes churn. As long as one gets a commission on buying and selling, the commission cash register rings. A number of top drawer news outfits reported that Microsoft was once again thinking about gobbling the software giant SAP. Bloomberg here reported that Microsoft is done with SAP and tossed in the observation that Microsoft was done with job cuts.
I heard a rumor about an enterprise acquisition road map. On that cartographic view of the future, Microsoft thinkers had identified a number of potential acquisitions. Some of these were in the enterprise space. I don’t have any details about the hypothetical targets, but I got the impression that Microsoft like Autonomy and Oracle is thinking about buying customers and market share in certain enterprise market sectors.
SAP is an interesting company. But there are other potential targets as well; for example, what about certain telecommunication players?
Microsoft may have to start buying and buying big. The reason? Structural changes are now taking place in enterprise applications. Even if the economy turns around, the punishing costs of on premises software may suck revenue from Microsoft’s core revenue streams. A loss of a few percentage points could ripple through the company. Rumors usually arise from a tiny crumb of fact. Acquisition thinking is in the spring breeze, but we don’t know the targets… yet.
Stephen Arnold, May 12, 2009
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