Contract Watch: October's Big WinnersBy Joseph C. Panettieri | Print
Re-Imagining Linux Platforms to Meet the Needs of Cloud Service Providers
Ever wonder what your competition's up to? Contract Watch has the answer. Joe Panettieri tells who's winning the big contracts, who's losing them and why.Ever wonder what your competition's up to? Contract Watch has the answer. Each week, this column will examine four or five business deals that are stirring the channel, and the solutions providers behind them. Our goal is to strip away the hype and tell you what's really sellingand what isn'tin today's IT marketplace.
From massive integrators like EDS Corp. to smaller solutions providers like Sequel Data Systems Inc., we'll examine the latest customer engagements and business deals that are shaping your market. (Want to describe your most recent customer win? Send me the details at firstname.lastname@example.org.)
First Up: Let's kick things off with a look at Computer Sciences Corp. The $11.3 billion IT services specialist has won a systems integration contract from the Department of Homeland Security's Bureau of Immigration and Customs Enforcement (BICE). The deal, valued at up to $88 million, calls for CSC to maintain and enhance systems that process travelers as they cross U.S. borders.
Deal 2: Another way to unlock new opportunities is to buy your competition. Ciber Inc. is doing exactly that. The Greenwood Village, Colo.-based solutions provider has a solid presence in the government sector. But Ciber wants even more of Uncle Sam's attention. The company has announced plans to acquire SCB Computer Technology Inc., which generates roughly 50 percent of its revenue from federal contracts and 35 percent from state and local clients. Not too shabby.
How much does a channel acquisition cost you these days? Ciber is paying a rather reasonable 16 percent premium for SCB (based on SCB's recent share price). The $90 million deal sounds like a win-win for both parties. SCB investors receive an early holiday bonus and Ciber gobbles up a company with positive cash flow, solid operations and a strong presence in the government sector.
Deal 3: If you have a germ phobia, feel free to skip this item. Unisys Corp. has won a deal to build a data center in Atlanta for The U.S. Centers for Disease Control and Prevention (CDC). The agreement includes a guaranteed one-year outsourcing deal (worth $1.8 million) with four optional years that could put another $7.2 million into Unisys' coffers.
Unisys is one of those integration companies that sort of sneaks up on you. While everyone watches IBM Global Services and EDS Corp., Unisys quietly racks up more than $5 billion in annual revenue. Perhaps it's time to visit Blue Bell, Pa., to see what makes this company tick.
Deal 4: This next item is actually a "deal in the making" for Sun Microsystems' iForce partners. Specifically, Arrow Electronics Inc.'s MOCA Division has launched two new marketing programsRenewal Blitz and Warranty Conversionto help iForce partners generate more revenue.
Frankly, I'm skeptical of both programs. Sun partners should certainly milk Solaris' installed base for all its worth, but Unix's best days are behind it. Sun's revenue has fallen in 10 consecutive quarters (or is it more? I've lost count) and CEO Scott McNealy has a conflict of interest: On the one hand, he needs partners to promote his products. But on the other, he needs to sell more hardware directly in order to improve profit margins. Toss in the mad dash to Linux and Windows, and many Sun partners could be left in the dark.
Next week, we'll take a look at early channel demand for Microsoft CRM. In the meantime, feel free to brag to me about your latest customer engagement. I'm all ears.
Joe Panettieri has covered Silicon Valley since 1992. He is editorial director of the New York Institute of Technology and founder of JCP Media Inc. Write to him at email@example.com.