Mobility leads the computer & tech revolution
While a weekend without the sales & use tax (IVU by its Spanish acronym) may have made it look like the economic recession hadn’t affected the technology industry, the reality is that it took a toll on many budgets, including those of such giants as Microsoft, Google and Sun Microsystems.
On the other hand, 2008 was a good year in terms of advances and industry transformation, perhaps driven by economic factors, but certainly led by the desire for faster solutions in a portable platform.
Web mobility was kick-started during 2008 and, to support portable Internet, mobile devices were the order of the day. Hardly a month went by without a new phone hitting retailers’ shelves around the nation.
RIM’s BlackBerry Bold and BlackBerry Storm, Google’s Android, Nokia’s N97 and, of course, the long-awaited iPhone were stellar releases in 2008. These phones’ operating systems proved it was possible to have a pocketsize computing platform, which only promises to get more efficient with time.
Wireless broadband also took a leap forward last year. Early in 2008, the Federal Communications Commission (FCC) allowed Verizon to use the 700 megahertz (MHz) spectrum that television broadcasters won’t use when they switch to high-definition transmission.
Furthermore, the FCC approved the unlicensed use of the interface buffer-zone spectrum between TV stations. According to Google, Microsoft and others, this decision will open the airwaves for innovation as much as or more than the approval of Wi-Fi did. Nevertheless, it all remains theoretical until the spectrum is built.
Apple continued to lead online music sales with its iTunes Store, and now promises to do the same with movies with its online movie purchase offer. The across-the-board deal includes movies from Fox, Walt Disney Studios, Warner Bros., Paramount, Universal, Sony Pictures, Lionsgate, New Line and others, although MGM isn’t part of the deal. Apple had previously offered full-length movies (about 1,500 are currently available) but only as rentals.
In Puerto Rico, 2008 was the year of the iPhone. The much-awaited Apple phone was a bestseller from the get-go, flying off the shelves by the hundreds, hours after it finally became available in October after mobile carrier AT&T invested $75 million to prepare its network for iPhone’s arrival on the island.
The national economic recession has forced technology and telecommunication giants—such as Sprint and Verizon Wireless—to reduce their workforces. AT&T announced a 12,000-person cut in its workforce for 2009, creating an uncertain panorama for Centennial employees since AT&T announced its intention to acquire Centennial Communications for $944 million. The deal is still pending FCC approval.
Tech giants have seen their market shares fall (Google, for instance, is down more than 62% from its high of $228 billion) and share prices stumbled (Sun Microsystems is down 85% to nearly $3). By year-end, many companies in these industries had laid off thousands of employees. In other industries, budgets for information technology (IT) services are frozen or shrinking.
Electronic gadgets were on most Christmas wish lists, making overall sales a bit better for retailers which, for the most part, didn’t have a good year. Take CompUSA, for instance. Mere months after the Guaynabo store’s grand reopening, CompUSA terminated about half of its in-store workforce, citing low sales as the main reason for the cutbacks.
Anyone who embarked on a quest to find video-game consoles or games noticed how hot items flew off the shelves of practically every retailer in major shopping centers. Nintendo outshined the competition, according to market-research firm NPD Group. In November, Nintendo sold two million Wii consoles and more than 1.5 million DS systems, a trend that continued throughout the holiday season. The same month, Microsoft ranked second, reporting sales of 836,000 Xbox 360 consoles, and Sony’s PlayStation Portable (PSP) sold 421,000 units.
Mergers, acquisitions and strategic partnerships seem to be the best way to go during this toughening economic situation. In early 2008, Microsoft’s interest to acquire Yahoo! became public when it put an unsolicited $44.6 billion offer on the table.
The corporate spectacle involved antitrust suits, the Department of Justice and the expulsion of Yahoo! founder & CEO Jerry Yang, among other events. Had the deal gone through, it would have given Microsoft the tools to compete with Google for the leading search-engine spot on the Internet.
Other changes are driving these industries’ futures and, as a result, the way we communicate.
Virtualization is fast becoming a no-brainer as hundreds of companies consolidated their data centers for benefits that management affords. For years, VMware has been a synonym for virtualization, but the entrance of Microsoft and Citrix into the market promises to end VMware’s leadership, particularly because Microsoft’s Hyper-V (its virtualization software) comes with Windows Server 2008 at no extra charge.
Bill Gates’ retirement, while it came as no surprise to many in the industry, was conversation for weeks. Gates remains Microsoft’s chairman and largest shareholder, but his last day as full-time employee was in June. His full-time work now is with the Bill & Melinda Gates Foundation, dedicated to spreading health and learning innovations throughout the world.
