Author: Nick Farrell

Redcentric is a mess but it claims to have a plan

cunning-planManaged services outfit Redcentric appears to be in a total mess but thinks it has a plan to get itself out of trouble.

Last month the outfit fessed up to multi-year accounting errors which meant it overstated net assets by at least £10 million and its net debt was nearer to £30 million. CFO Tim Coleman was “placed” on “garden leave with immediate effect.”

Redcentric delayed interim results for the half year ended 30 September until Deloitte and law firm Navarro could do a “forensic review” of its numbers. The results show that things were much worse than expected and the cumulative overstatement of net assets and profits after tax up to the half-way stage of this fiscal year was £20.8 million. To make matters worse more than a quarter of this arose in the six months of this financial year. The remaining £14.9m related to the years up to 31 March 2016.

Normally you could not lose that much money unless it was being taken by a bloke with a gun aided by a bloke outside with the motor running.  However, the report ruled out theft.

“The misstatements are attributable to profit overstatement over several years with revenues being overstated and costs understated in broadly equal proportions,” the firm told the London Stock Exchange.

Net debt turned out to be “materially higher than was originally reported” and was £37.8 million at the end of March and £34.4 million at the end of September.

Redcentric said the net debt in those periods was “not representative” because creditors had been “significantly stretched at those dates”. The average net debt position over the past eight months to the end of last month was £42 million.

Redcentric has recalculated historic banking covenants and has received waivers such that it remains compliant with the Ts&Cs. This will aid changes to billing and credit control management systems and processes, and the continued restructuring of the finance department.

The delayed half-year numbers to September will be reported before the end of the calendar year, and Redcentric forecast sales to be £53m and EBITDA £9.1m.

Redcentric’s share price almost halved last month when the news first broke of the financial errors; they recovered somewhat in the interim and were down nearly five per cent today.

Amazon was the Queen of Christmas

amazonOnline book seller Amazon said it shipped more than 1 billion items worldwide this holiday season, saying that it was its best ever.

The Amazon Echo home assistant and its smaller version, Echo Dot, topped the best-sellers list. Jeff Wilke, chief executive of Amazon’s worldwide consumer division said that it had difficulty keeping the shiny toys in stock.

Sales of voice-controlled Echo devices were nine times more than they were during last year’s holiday season, the company said. Amazon did not disclose comparable sales figures from a year earlier.

Jan Dawson of Jackdaw Research pointed it out it was easy to be positive when you don’t tell the world the actual figures. He said that that this year’s figures were all relative to numbers that they have never told anyone about.

Amazon likely sold between 4 million and 5 million devices this year to date with Alexa, the voice-controlled assistant on the Echo, estimated Morningstar analyst R.J. Hottovy in a research note. Shoppers can command the Echo to perform a host of tasks, from playing music to turning on Christmas lights.

“While Amazon’s device sales are still relatively small growth drivers currently, we believe the proliferation of these devices will drive more ubiquitous use of Amazon services over time,” said Baird Equity Research analyst Colin Sebastian in a note, pointing to customers ordering more items by speaking to the Echo.

More than 72 percent of Amazon’s customers worldwide shopped through mobile devices, the company added, and 19 December was the busiest shopping day this holiday season.

“Prime customers are spending twice as much as other consumers using Amazon and helping to fuel rapid revenue growth that few retailers with only a fraction of Amazon’s revenues are able to generate,” Retail Metrics President Ken Perkins wrote in a note last week.


Ericsson to expand its doings with Cisco

Cisco Kid Ericsson has announced that it is expanding its partnership with Cisco to target new corporate clients and the public sector in 2017.

Rima Qureshi told hacks that Ericsson and Cisco think they can make an extra $1 billion each in revenues by 2018 through a partnership which was announced late in 2015 and cash like that is not to be sneezed at.

Qureshi says Ericsson’s Cisco partnership, which generated over 60 deals in the first year, has been mainly focused on telecom operators. Next year, the firms plan to target enterprises and public sector .

She said that the two  are looking much closer into how theycan work on the enterprise

“We are investigating what we can do together within Industry & Society, IoT, smart cities and we’re going to target specific public sector segments, specifically for example transportation, utilities … And then of course we’re looking at other segments such as security,” she added.

Qureshi says Ericsson’s forecast to generate up to 25 percent of revenue from business outside of telecom operators by 2020.

Swiss buy Clearswift to get into the UK

swissWhile Brexit might see EU companies departing the UK it seems the Swiss are going the other way.

Theale-based security specialist Clearswift has been acquired by a Swiss firm RUAG which wants to expand its reach in the UK

Apparently, the outfit was impressed with the strength of the firm’s channel network which aided the sale.

From the start of next year Clearswift’s products will fall under the RUAG Defence cyber security business unit, which will be headed by Dietmar Thelen.

The Clearswift acquisition gets a firm with around £23 million in revenues and 140 staff focused on data loss prevention and a well-developed UK channel.

CEO of the RUAG Defence division Markus Zoller said that Clearswift’s global partner network and customer base in conjunction with its analyst-recognised solutions will play a key role in the growth of the RUAG Defence cyber security business unit.

“We are aiming to become a principal solution and service provider for organisations of all sizes and across all verticals, including local and national government organisations, financial institutions and critical infrastructure providers,” he added “By combining our expertise in network defence with Clearswift’s data loss prevention and gateway solutions we will further boost our efforts to make RUAG Defence one of the leading cyber security specialists.”

RUAG has a core business in aerospace and defence, has offices across Switzerland, Germany, Austria, Hungary, Sweden and in the US and has been selling into the UK.
No one is saying how much the outfit paid for the British firm.

Dell details channel tiering plans

dellchannTin-box shifter Dell been telling its partners how the new tiering levels will work on its unified channel programme.

Dell EMC resellers and distributors will see the launch of the unified partner programme on the 1 February next year. It was announced in October will it started it would have three main levels: titanium, platinum and gold, with an exclusive titanium black status also available.

John Byrne, president, Dell EMC Global Channels has now outlined how partners can qualify for those different levels and what will be needed with.

Writing in his bog, Byrne said that the levels of the tiering will be determined by legacy programme rules and there will be revenue and training requirements for those that want to join the scheme.
Under the changes those that were Dell PartnerDirect Premier+/EMC BPP Platinum partners will be eligible for the titanium level; Dell PartnerDirect Premier/EMC BPP Gold will be platinum; and Dell PartnerDirect Preferred/EMC BPP Silver will be gold.

Those who were ‘registered’ under the old Dell programme or ‘authorised’ under the EMC scheme they will now be classed as authorised.

“Partners who are members of both legacy programs and meet the requirements of each will be awarded the higher status of the two. For example, if a partner is Preferred in Dell PartnerDirect and Gold in the

EMC Business Partner Program, that partner’s new Dell EMC Partner Program Tier will be Platinum. It’s just the right thing to do. It’s ‘Partner First’,” said Byrne.

The unified programme was simple, predictable and profitable and it would continue to be open to suggestions from the channel over further improvements.

“The Voice of the Partner has been absolutely critical, and we will continue to have “big ears” and listen closely and constantly to what they need and want from our program,” said Byrne.

Server revenues and shipments plummeting

Epic_FailThe latest figures from IDC’s Server Tracker reveal black figures for server makers and their partners with revenues and shipments plummeting across the region

Beancounters at IDC said that Server revenues fell by nearly 15 per cent in the most recent quarter and third quarter sales fell by 14.3 per cent year-over-year to $2.6 billion. Only  over 500,000 units were shipped, a decrease of 7.2 per cent year over year.

The non-x86 market declined compared with previous quarters, with vendor revenue down 23.4 per cent compared to the previous year and made just over $314 million.

The biggest decline was seen in standard density optimised server units, which saw a 45.8 per cent decline in revenue. While blade servers did well in terms of revenue and shipment numbers, but they also fell sharply compared to the year before, by 22.2 per cent and 23.5 per cent respectively.

Custom density optimised servers were the only product to experience positive growth in the quarter, with shipments increasing 52.2 per cent and revenues by 15.3 per cent.

Eckhardt Fischer, research analyst, European Infrastructure, IDC said that at a regional level, HPE maintained its position as market leader in Western Europe, with 36.5 per cent market share. Lenovo kicked IBM from the third spot a market share of 7.9 per cent.

IDC blamed political and economic uncertainty, tepid demand typical in 3Q, and fewer large server deals were some of the primary catalysts for downward pressure on regional revenues.

The UK was one of the worst performers over the quarter. IDC said this was due to ongoing uncertainly over the impact of Brexit.

Civica buys up social housing software provider Abritas

civica_logo_linkedinCivica is continuing to buy up government tech specialists and this time has written a cheque for the social housing software provider Abritas

Abrita, which is based in Reading,  provides web application software and related services for the social housing sector and its SaaS services are used by more than 170 local authorities and housing associations.

“The acquisition brings specialist capability which the Group does not currently offer, which strengthens its capability to support improved and more efficient tenant services and help address homelessness,” Civica said in a statement.

This is yet another scalp for Civica which bought the technology and outsourcing company SFW earlier this year; and before that, bought software applications developer IPL. In September last year it bought the o Web Technology Group.

Wayne Story, chief executive of Civica said: “I am delighted to welcome Abritas to the Civica Group. Abritas brings a strong heritage and product set, and the combined business is very well placed to respond to the needs of customers to adapt to a changing social housing landscape.”

Simon Reynolds, sales director of Abritas, added: “This is the next stage in the development of our business and is a very positive step for employees, customers and partners. The combination of our specialist expertise and Civica’s breadth and depth of capability creates an exciting combination at an important time for the social housing sector. We look forward to building on our joint strengths in order to deliver increasing value to customers.”

Oracle comes up with a way of getting Java off every machine

JavascriptDatabase maker Oracle has worked out a way of getting its Java code off every machine in the world – it is starting to sue those who use it without permission.

Six years after it wrote a cheque for Sun, Oracle is ramping up audits of Java customers it claims are in breach of its licences.

Oracle has been hitting up customers and partners claiming they are out of compliance on Java. This has taken some time but now its License Management Services (LMS) division is being more active in chasing down people for payment.

The database giant is understood to have hired 20 individuals globally this year, whose sole job is the pursuit of businesses in breach of their Java licences.

This is causing a boom in the industry compliance industry with specialists are themselves ramping up, hiring Java experts and expanding in anticipation of increased action next year.

At the heart of the issue is Java SE which comes in three paid flavours costing $40- $300 per user and $5,000 – $15,000 per processor.

Experts telling people to avoid downloading Java SE and those who have should review its use before Oracle pounds on their door.

We have been told that Oracle is also targeting its partners, even though they are the ones helping Oracle carry out the legal moves.

The issue is that people seem to believe that Java is free software because that was the case under Sun. Sun charged a licensee fee to companies like IBM and makers of Blu-ray players, but generally Sun used Java to help sales of its systems.

Oracle changed all that with Java SE includes Java SE Advanced Desktop, introduced by Oracle in February 2014, and Java SE Advanced and Java SE Suite, introduced by Oracle in May 2011.

Java SE is free but Java SE Advanced Desktop, Advanced and Suite are not. Java SE Suite, for example, costs $300 per named user with a support bill of $66; there’s a per-processor option of $15,000 with a $3,300 support bill.

Java SE is not free for what Oracle’s licence defines as “specialized embedded computers used in intelligent systems.” This includes mobile phones, hand-held devices, networking switches and Blu-Ray players.
Another issue is that when you download Java SE you can end up installing things you don’t need but have to pay for.
If anything Oracles actions are going to really hack off users next year and there will be a general backlash against Java in 2017.

Cisco gives up on the cloud

Cisco Kid Networking giant Cisco will walk away from its billion dollar investment in the public cloud by the middle of next year.

Cisco will abandon its InterCloud  and will move any InterCloud workloads to other, unnamed cloud providers. The move is being seen as a victory for Amazon Web Services and Microsoft Azure, Google Cloud, and IBM.

HP saw the writing on the wall in 2015  and abandoned its efforts to be a public-cloud company. It shut down its much-hyped Helion cloud offering earlier this year. VMware still offers its vCloud Air hybrid-cloud service, though it has agreed to partner with AWS, which it once viewed as its rival.

Cisco said that it did not expect any material customer problems as a result of this move.

“For the last several months, we have been evolving our cloud strategy and our service provider partners are aware of this.”

Cisco launched InterCloud almost exactly two years ago. It anticipated spending $1 billion over the next two years building the offering, which it called “a network of clouds” and “a way to lower the total cost of cloud services ownership and pave the way for interoperable and highly secure public, private and hybrid clouds.” It was to be, Cisco said in March 2014, “the world’s largest global intercloud” and yet also “the first of its kind, delivering a new enterprise-class portfolio of cloud IT services.”

Cisco said it planned to build the product through partners, including Australian service provider Telstra; Canadian business communications provider Allstream; European cloud company Canopy; cloud services aggregator Ingram Micro Inc. and others. InterCloud would include platform and infrastructure as a service and Cisco’s collaboration, security and network management, and would be “architected for the Internet of Everything.”

In the end though it was sucking up resources like a Dyson in a tornado and at the same time customers were going elsewhere.

AWS’s share of the market for infrastructure and platform as a service as of June was over 30 percent, with year-over-year revenue growth of 53 percent, according to Synergy Research Group. Azure’s was over 10 percent, with revenue growth of 100 percent. IBM’s share was about 8 percent, Google Cloud’s was about 5 percent, and the remainder was collectively consumed by 12 or more companies.


Amazon opens “top secret” cloud operation in UK

amazonAmazon Web Services today announced the launch of its previously “top secret” AWS Europe (London) Region.

The London Region is AWS’s third European Region, with existing regions in Ireland and Germany. Apparently the entire project has been built in secret and was only announced yesterday.

“Starting today, developers, startups, and enterprises, as well as government, education, and non-profit organisations, can leverage the AWS Cloud to run their applications and store their data on infrastructure in the UK,” AWS said.

The AWS Europe (London) Region offers two Availability Zones at launch.

“Our customers and APN Partners asked us to build an AWS Region in the UK, so they can run their mission-critical workloads and store sensitive data on AWS infrastructure locally,” said Andy Jassy, CEO, AWS. “For the past decade, we’ve had an enthusiastic base of customers in the UK choosing to build their businesses on the AWS Cloud because it has more functionality than other cloud platforms, an extensive APN Partner and customer ecosystem, as well as unmatched maturity, security, and performance. A local AWS Region will serve as the foundation for even more innovative cloud initiatives from the UK that can transform business, customer experiences, and enhance the local economy.”

Karen Bradley, UK Secretary of State of Culture Media and Sport, was clearly relieved that Amazon was expanding its operations post-Brexit and not leaving the country.

“I’m delighted to welcome the opening of the UK Amazon Web Services Region, which is a strong endorsement of our approach to the digital economy. The new AWS Region shows a clear confidence in the UK being open for business and one of the best places in the world for technology companies to invest in and grow.”

Customers fear Microsoft audits

damsel-terror-gifCustomers have a rather serious fear of a Microsoft software audits, according to a new survey.

Snow Software has found that the prospect of a Microsoft software audit puts most customers into a state of panic.

While most software audits spark terrors of sudden licensing costs and threats of fines and court action, those from Microsoft, SAP and Oracle are the worst.

Snow Software found that three quarters of those SAM and IT managers it quizzed saw Microsoft as the vendor audit to be feared the most. There were high levels (53 percent) for Oracle and SAP (33 percent).

Microsoft has been a heavy auditor and pounded on the doors of 68 percent of firms in the last year.

What creates the fear is not so much the resulting fines but also the fallout of having to explain to senior management just why those unplanned costs had occurred and the disruption it could cause to the business.

Matt Fisher, vice president of Snow Software said that while he expected to see Microsoft reported as having the highest volume of audit activity, it was surprising to see them take the number one slot in terms of being feared by their customers.

“In our experience, Microsoft is actually one of the least aggressive and difficult software auditors.  We typically hear far more horror stories from customers that have been audited by Oracle or Attachmate (now Micro Focus),” he added.

On demand delivery model gets a good kicking

postman-patThe “on-demand delivery” business model which was attracting huge amounts of investment is suddenly no longer popular.

Michael Moritz, chairman of Sequoia Capital and one of the most successful venture capitalists in history, said the “on-demand” model made a lot of sense. It was a huge trend enabled by smartphones and he invested about nine billion into it.

But in the last half of this year that money stalled completely. Several prominent Silicon Valley venture capitalists are now saying that many delivery start-ups could fail, leaving investors with big losses.

Delivery start-ups continue to grapple with fierce competition, thin margins and a host of operating challenges that have defied easy solutions or economies of scale. This has resulted in widespread discounting and artificially low consumer prices have made on-demand delivery.

There have been a few high-profile failures, including US meal delivery firm SpoonRocket, which went down in March, and PepperTap, an Indian grocery delivery service backed by Sequoia that folded in April.
Some think that the only thing which could transform the sector are driverless vehicles and sidewalk robots. However, that remains far from a practical reality, leaving many start-ups with no clear path to innovate their way to profitability anytime soon.

Markus Haas is Telefonica Deutschland’s new supremo

markus-haasTelefonica Deutschland has appointed Markus Haas to replace its supreme dalek Thorsten Dirks who announced in November he was exiting the telecoms firm.

Haas, 44, a lawyer who has been with the company since 1998 and is chief operating officer is under orders to lead the telecoms company in close cooperation with finance chief Rachel Empey.

Haas was appointed to the executive board and since 2012 he was a member of the board of directors of Telefónica Deutschland Holding in 2009, where he most recently steered the company strategy.

The successful acquisition of E-Plus group was one of his moves as was the acquisition and integration of HanseNet, the LTE spectrum auction and Telefónica Deutschland´s successful IPO.

He also negotiated the commercially important strategic partnerships with Deutsche Telekom, Versatel and most recently Drillischamong others.

Markus Haas started his career in the legal affairs and regulatory division at Telefónica in Germany in 1998 -at that time Viag Interkom -and subsequently worked as Executive Assistant of the CFO.

Afterwards, he steered as Vice President the Corporate & Legal Affairs department with commercial responsibility for the roaming-and wholesale network-business.

Telefonica, which is controlled by Spain’s Telefonica, said Haas would start his new role on 1 January with a three-year contract.
Dirks will be supporting the new leadership during the first three months of 2017. Dirks, who has been at the helm since October 2014, said at the end of November that he was leaving to pursue new challenges.

Solution providers need to change

bodenA Google executive has warned that solution providers need to invest in next-generation technologies to stay ahead of the curve.

Nan Boden, head of global technology partners at Google’s Cloud division, said solution providers need to pull their socks up and get new skills and services. She said more customers wanted to target digital transformation for their businesses and there were new consumption models and buyers who wanted a part of the lucrative cloud economy.

Talking at the NextGen Cloud event, Boden said that industry models will be based less on products and more on services.

“This is putting pressure on partners to provide services to customers. It requires a different motion and skill set that is not optional, and we’re seeing successful channel partners get ahead of that.”

She added that punters were demanding faster time-to-value, minimal up-front commitment, and increased flexibility and scalability for their businesses, requiring solution providers to move away from a sales and marketing reseller model to a more value-added services model.

This includes offering managed services and even packaged IP technology solutions to solve customer needs, she said.

“We’re seeing partners using machine learning, the cloud and analytics together in ways that are transforming industries. We believe that if you invest in innovations for your line-of-business customers, that will pay off.”

London could lose out as Euro tech hub

are-we-afraid-noLondon could lose its position as the leading destination for start-ups in Europe thanks to Brexit.

Tech investors moaned at the TechCrunch Disrupt London conference, that the government needed to answer shedloads of questions around immigration policy.

James Wise, partner at venture capital firm Balderton Capital, said that Britain employed 31 percent of all the people in Europe working in tech start-ups, and a significant number of them had moved to the country to start their businesses.

Government initiatives to support the tech sector were welcome Wise said, but the British government needed  to show more leadership and clarify the many questions hanging over the free movement of talent.

“The number one concern is still access to talent, and while the raft of announcements are all very welcome, very few of them deal with the ability to attract global talent to the UK to build companies here,” he told Reuters.

Reshma Sohoni, a partner with Seedcamp, which invests in  early stage companies, said funding for such companies had tightened considerably since the Brexit vote.

“We definitely see a narrowing of the kind of companies that can get series A or series B funding,” Sohoni said, referring to early rounds of venture funding that young companies need to grow. “Combining the uncertainty and the trouble getting visas, absolutely it (Brexit) is a problem,” she said at the event.

Matt Hancock, minister for the digital economy, said Britain needed “to be open and welcoming to the brightest and best from around the world” and not just the EU.

“Over the last few years, we’ve had freedom of movement within the European Union but outside we’ve had a fairly tight visa system, and we need to make sure we are clearly attracting and winning the global war for talent,” he told the assorted throngs.

“We’ve been doing this with visas for individual countries over the past few years, improving significantly for instance the visa system for China. Clearly we’ve got to get this right.”