Does this mean that both firms have lost the growth opportunity individually, or is it collaboration to get to the next level. Only time will tell. Aivars Lode avantce

Apple, IBM in Deal to Create Apps, Sell Phones

Tech Firms Plan to Create Business Apps and Sell iPhones, iPads to IBM's Corporate Customers

Enemies during the early personal-computer wars, Apple Inc. and International Business Machines Corp. said they will cooperate in the mobile era, striking an agreement to create simple-to-use business apps and sell iPhones and iPads to Big Blue's corporate customers.

The deal underscores Apple's push to expand the reach of the iPhone and iPad into the business world—beyond their traditional base among consumers. IBM,meanwhile, is hoping Apple's simplicity and popularity will help stem eight consecutive quarters of year-over-year revenue declines, as it moves more of its business software onto the mobile devices used by employees.

Apple Chief Executive Tim Cook and IBM CEO Virginia Rometty declined to comment on financial terms.

A partnership between the two companies would have been unthinkable 30 years ago when Apple famously attacked IBM in an iconic commercial titled "1984," painting IBM as a big-brother-like figure protecting the status quo while Apple's Macintosh provided a pathway to freedom.

But both companies have evolved since those days. While Apple still produces Mac computers, its main products are mobile devices. IBM sold its personal-computer business to Lenovo Group in 2005, repositioning the company as a software and computer-services provider.

"In '84, we were competitors. In 2014, I don't think you can find two more complementary companies," said Mr. Cook, who worked at IBM for more than a decade before joining Apple, in a joint interview with Ms. Rometty. "This is a really landmark deal."

The two companies said they hope to use the expertise of IBM's consultants and relationships with corporate customers to create business apps that offer the simplicity—a hallmark of Apple products—of today's consumer apps. The apps will draw on IBM computing services such as security, device management and big-data analytics.

Under the agreement, IBM's employees will provide on-site support and service of Apple products inside companies, similar to the AppleCare service that Apple sells to consumers. IBM said it planned to make more than 100,000 employees available to the Apple initiative. It is a rare partnership for Apple, which historically has avoided such alliances.

"This is just the beginning," said Ms. Rometty, citing a statistic that most smartphones inside companies are used only for email and calendar. She said the companies hope to create new, serious business applications.

The companies said Apple and IBM engineers are together developing more than 100 new apps for various industries. The first batch of apps is expected to be available in the fall when Apple releases the next version of its mobile software, iOS 8.

Historically, Apple has made little effort to sell to businesses. Under Mr. Cook, Apple has started to find success in selling to corporate tech managers. While Apple has made progress in selling to the enterprise, IBM has much deeper ties in that world.

"Apple is not an enterprise company, but that's not their DNA. It is IBM's DNA and IBM has had those relationships forever," said Gartner analyst Van Baker. "It's an unlikely combination but a very strong one if they can pull it off."

One challenge for Apple is that not many technology companies have succeeded as both an enterprise and a consumer brand. But as more employees bring their own technology to work, they expect the same ease of use in the office as at home.

According to Forrester Research, global business and governments spent about $11 billion on iPads in 2013—or about one-third of Apple's total tablet sales. By 2015, Forrester estimates that figure will grow to $13 billion, outpacing the overall rate of spending growth for computers and tablet computers.

Forrester principal analyst Frank Gillett said the tandem of Apple and IBM could spurGoogle Inc.—whose Android operating system is a rival to Apple's iOS software—to seek partners in the corporate segment to create a "credible alternative." Google didn't respond to a request for comment.

Apple's stock rose 1.6% in after-hours trading following the announcement. IBM shares were up 2% after hours.

The slow down of erp is upon us. SAP Second-Quarter Profit Falls. Aivars Lode avantce

SAP Investors Shrug Off Profit Decline

German Software's Cloud-Based Revenue Surges, Lifting Share Price

FRANKFURT—Shares in SAP SE jumped as much as 5% on Thursday after the software company said revenue from cloud applications rose rapidly in the second quarter, despite reporting a drop in profit.

The German company—which supplies businesses with applications for processes such as accounting and managing customer relations—reported a 23% fall in net profit from a year earlier to €557 million ($753 million), after it booked €289 million in provisions for a patent litigation with Versata Software Inc. Second-quarter revenue increased 2.2% to €4.15 billion.

But investors focused on revenue generated from SAP's cloud-based products, which jumped 52% to €241 million. Management raised its forecast for full-year cloud revenue by €50 million to between €1 billion and €1.05 billion, in part because of the recent acquisition of Fieldglass, a maker of workforce management cloud software.

Cloud-based products offer huge revenue potential for SAP, as the company's clients replace on-site software on computers with cloud applications to take advantage of lower maintenance costs.

SAP's cloud business will be at least as profitable as Europe's largest software maker as a whole, said Chief Executive Bill McDermott. The company is targeting an operating margin of 35% by 2017 after reaching almost 33% last year.

"Over time, you'll have a just-as-good margin in the cloud, if not better," said Mr. McDermott.

But SAP faces challenges from competing vendors of cloud applications, such asSalesforce.com Inc. and NetSuite Inc. SAP's main rival, Oracle, is also targeting growth in the cloud sector, but last month reported a fall in fourth-quarter profit.

Société Générale analyst Richard Nguyen said the big surprise was that SAP's cloud revenue grew much more rapidly than that of Oracle and Salesforce, which reported 25% and 36% respective increases in their latest quarters.

At 1015 GMT, SAP shares were trading 3.9% higher at €60.25.

SAP said its operating-profit forecast for the year of €5.8 billion to €6 billion now excludes expenses related to litigation with Versata. The guidance is adjusted for currency effects and based on SAP's own accounting method. If exchange rates remain at the June level, they will diminish operating profit growth by two percentage points.

Mr. McDermott has been SAP's sole CEO since May, when his former co-chief, Jim Hagemann Snabe, moved to the supervisory board. The sole leadership has helped SAP move faster, he said.

"You have to move fast because markets are nimble," he said.

Mr. McDermott last week relocated to a new home in Heidelberg, near SAP's headquarters in Walldorf. He used to work at SAP's U.S. headquarters near Philadelphia.

"I have a little house stuck in the rock," he said, from which he can see Heidelberg's famous castle.

Even stock exchanges and trading floors have changed. Aivars Lode avantce

Empty Floors Fray Traders' Nerves

By Katy BurneJuly 13, 2014 10:24 PM

UBS AG's trading floor in Stamford, Conn., once teemed with traders occupying a space equal to two football fields. The Guinness World Records recognized it as the biggest such facility on the planet. And the Swiss bank used it to showcase its Wall Street credentials.

Stu Taylor, a former UBS managing director in trading who now runs trading-technology company Algomi Ltd., remembers when guests were brought around the gallery regularly. "It was very much a showpiece," he said.

Today, there are virtually no traders shouting into their phones or staring at terminals. UBS's cavernous floor is taken up mostly by back-office, legal and technology staffers, according to people familiar with the bank.

A spokeswoman for UBS said the trading floor was built for 1,400 traders, but wouldn't disclose the number of employees at the facility.

A deep slump in trading activity in everything from stocks and bonds to currencies is changing the face of Wall Street. Businesses that once contributed disproportionately to the revenues of the world's largest banks are now bleeding jobs and sparking fears of a permanent decline.

Today's markets are "boring," said Thomas Thees, a former head of North American credit trading at Morgan Stanley and a former co-head of fixed income at Jefferies Group. "This is affecting the opportunity to make money, and ultimately the earnings these [trading] businesses can provide."

Global revenue from trading in fixed income, currencies and commodities, or FICC, dropped to $112 billion last year, down 16% from a year earlier and 23% from 2010, according to Boston Consulting Group.

As big banks with large trading operations such as J.P. Morgan Chase & Co., Goldman Sachs Group Inc. and Citigroup Inc. report second-quarter earnings results this week, investors and analysts will be trying to find out whether the slowdown is a temporary funk or a lasting shift.

The forces arrayed against banks' trading businesses are powerful. Since the financial crisis, regulators have limited their ability to take risks with their own money, and have made the process costlier, prompting many to dial back or push in different directions. At the same time, global markets have fallen into an unusually placid pattern that has damped clients' desire to make trades.

"It's been absolutely dead," said Jarrod Dean, a municipal-bond trader at Sierra Pacific Securities in Las Vegas. Municipal-bond trading volumes are down about 30% since last August, he said, while profits are down more than 70%. "We've just got to keep toughing it out," he said.

The malaise has prompted an exodus of traders from big firms to smaller ones that are less subject to government oversight.

Late last year, Sound Point Capital Management LP, a $5.2 billion, credit-focused asset manager based in New York, scooped up five credit traders and analysts from UBS.

The rowdy atmosphere once celebrated on Wall Street already was on the wane when the crisis hit, as electronic-trading platforms began ushering in a quieter era. But the downturn and the new rules that followed have emptied desks and left fewer people to make sales calls and trade securities.

Down the road from UBS in Stamford, the U.K.'s Royal Bank of Scotland Group PLC has faced similar struggles. In 2005, RBS accepted $100 million of tax breaks in exchange for spending $345 million on a gleaming new headquarters in Stamford, creating 1,150 new jobs and retaining 700 employees in the state.

Two months ago, the bank, now majority-owned by the British government after a crisis-era bailout, said it planned to cut 400 jobs, in part to refocus the bank's attention on the U.K. market.

A spokeswoman for RBS confirmed the intention to reduce staff and said it met the requirements under its agreement with the state of Connecticut, but otherwise declined to comment.

Among those no longer at RBS is Alan Osborne, who formerly sold fixed-income products for the firm and last year started as a salesman at trading-systems company Equinix. RBS's Stamford office already was "half full when I left two years ago," said Mr. Osborne.

As a sign of the anxiety being felt on trading floors, a scuffle erupted in the trading pits of the New York Mercantile Exchange floor on June 24, according to witnesses. One combatant's shirt was torn, a trader said.

Witnesses said the skirmish began when two traders argued over where they could stand in the pits. A spokesman for CME Group, which owns the Nymex, declined to comment.

Morgan Stanley has beaten the hastiest retreat from FICC of any U.S. firm. In 2010, the New York firm began shifting toward steadier businesses like wealth management. Today Morgan Stanley's FICC operation, once considered a broad frontier for expansion, employs just 1,600 people, down about 20% since 2010, according to people familiar with the matter.

Some, like Goldman Sachs Group Inc. and Deutsche Bank AG, have argued their decisions to stay the course will pay dividends later when more clients return to the markets to trade and find fewer banks willing to trade with them.

Equities trading volumes also have taken a beating of late. Stock trading in the second quarter fell 43.6% from second-quarter 2009 levels to their lowest level since 2007, according to Credit Suisse Group data.

Bill Nichols, head of U.S. equity trading at Cantor Fitzgerald LP, said low volumes have taken a toll on traders' psyches.

"When you go a day or two and don't have a trade on the tape, it's frustrating," he said.

A few weeks ago, Mr. Nichols said, he passed a young equity salesman in the hallway. The salesman, who got his start in Wall Street after the crisis, was shaking his head over how slow the market had turned.

"You go through lulls," he said. "If you're going through this for the first time, you have no context."

Mr. Nichols said he encouraged the trader to press ahead with calls to clients, take care of administrative tasks or take a research analyst out to lunch.

Is Your Business Model Being Disrupted? The Era of Code Halos Is Here.

The world of buiness is changing from nouns to verbs. Aivars Lode avantce

Oracle's IP lawsuit foe: We'll fight SAP tooth and nail in Europe

ERP vendors are being attacked by the cloud and are now at the core of thier maintenance business by new comers. Aivars Lode avantce

By | Gavin Clarke 25th June 2014 08:04

Oracle's IP lawsuit foe: We'll fight SAP tooth and nail in Europe

Rimini Street: We'll have your large and mid-sized customers off you, ta

Rimini Street, the fast-growing business software support specialist currently fighting Larry Ellison’s database giant in US courts, appears to have SAP in its sights in Europe.

“Look out SAP,” Rimini Street chief executive Seth Ravin warned the giant in a recent interview with The Reg.

“We are going to fight them tooth and nail on these large and mid-sized companies,” he continued.

It’s the opening shot of a new campaign that will formally get under way next week with the opening of brand new offices in London, at Canary Wharf.

The UK features strongly in the global growth plans of a company that claims to provide service and support to SAP customers for half the price charged by the software giant.

Discounted pricing has helped push Rimini towards revenue increases of 40 per cent a quarter.

The United States accounts for 80 per cent of that, but the CEO’s plan is to decrease reliance on the US by expanding the global share of the pie from from 20 to 40 per cent.

The UK and Europe – the latter the backyard of SAP, which is based in Waldorf, Germany - are going to be big chunks of that total 40 per cent, Ravin promised.

“It’s a brutal battle – breaking open any new market is a tough play.”

Can you ever uncouple from the biz who does your support and upgrades?

Rimini Street is putting corporate noses out of joint in this battle for ERP wallets and minds – and SAP and Oracle are twitchy. Ravin’s company threatens a fundamental and increasingly vital piece of their business – support and upgrades.

Rimini Street specialises in making and delivering updates and fixes for SAP and Oracle enterprise resource planning (ERP).

SAP and Oracle already provide this support, but Rimini claims to undercut them by 50 per cent on an annual basis. That’s a problem for SAP and Oracle because support has become a critical component of their businesses as sales of new versions of their software has slowed to a single-figure limp.

Support for SAP software accounted for the $18.8b (€13.9bn) of the company’s total revenue stream of $22.8bn (€16.8bn) in 2013.

Support was Oracle’s second largest business line during its most recent year - $18bn out for $38.2bn, accounting for 47 per cent of all the money it made.

Oracle, which reported its full year last week, wasmauled by investors for – yet again - missing their expectations.

Rimini Street is still small fry by comparison – only just heading towards $100m in revenue, according to Ravin. But what’s important is that once Rimini has customers, it has them for life, and keeps them signed up and updated.

But this isn’t about price alone.

Rimini’s ongoing development work sees it deliver updates and fixes for customers that allows them to prolong the life of crucial ERP systems rather than get forced to upgrade to a new versions because Oracle and SAP no longer support their version.

ERP is a knobbly piece of software and Rimini Street keeps all kinds of updates coming for SAP, Oracle, Siebel PeopleSoft and JDE (owned by Oracle) on the finer details of tax, legal and regulatory changes plus the standard compatibilities with other companies’ software and hardware as they change – as part of the service.

Ravin points to a recent Cobol compiler for PeopleSoft developed and delivered with IBM. He says that Rimini Street delivers the IBM/PeopleSoft Cobol compiler (combined with a Rimini pre-compiler) – for free but claims that Oracle charges a licence fee of $25,000 (PER YEAR?).

Also, there’s customer service: Ravin claims a 30-minute response time on urgent issues with a dedicated primary support engineer for each account.

“We are spending a good deal of money on the technologies because it’s a part of the overall solution and it makes us very sticky,” Ravin claimed.

“[Oracle and SAP] want you to spend money on upgrading because that’s the only way they make money. We are the only guys who come to us and say: 'You don’t need to spend a penny'. So it gives us a very different relationship with the customer.”

Oracle in the US had had enough by January 2010. It struck out at Rimini Street, taking the company to court alleging “massive theft” of Oracle software and support materials had taken place through Remini's work supporting Oracle ERP customers.

What's emerged since then is an effort by Larry Ellison's company to protect the entire support business – not just on ERP. In 2013, Oracle accused independent Solaris fix-it companies Terix and Maintech of stealing its copyrighted code in supporting customers’ Oracle servers. All the cases are ongoing.

But while Oracle might be miffed, its users aren’t.

Since Oracle chose to take on Rimini Street in the courts, Ravin reckons customers have been voting with their chequebooks: he claims Rimini Street has grown in size between six to seven times since Oracle fired the first shot in its legal war.

Already in the UK with 30 employees, it has 400 worldwide, Rimini Street claims a growing number of local names that include Jaffa Cakes and Jacobs’ crackers maker United Biscuits as well as supermarket chain Sainsbury's. Overall, Rimini Street claims nearly 900 customers worldwide in the Fortune 500 and in the public sector.

Born during Y2K

A former head of worldwide support policy for PeopleSoft, Ravin said he saw the opportunity in providing such customers extended support during the rush to replace systems ahead of Y2K. He founded Rimini Street in 2005.

Expanding in the UK and Europe will mean even more clashes with Oracle and particularly SAP, given its based in Germany. Already, Ravin claims to have already snatched Germany's flag-carrying telco Deutsche Telekom from its ERP masters.

“SAP hates us with a passion... but we do have the ability to talk to SAP,” Ravin said. He admits to a frosty working relationship.

“We have a structure set up with our lawyers and their lawyers to talk.”

Ravin sees Rimini Street as disrupting the all-powerful giant support businesses owned and operated by SAP and Oracle.

Legal fights, midnight phone calls and bare-knuckle customer fights with SAP and Oracle don’t seem to bother Ravin. Rather, he seems to be more concerned by the potential threat posed by other companies similar to Rimini Street appearing to take business.

The UK and Europe expansion should be seen as a way of setting down boundaries and signing up sticky customers before others get in on the act.

“We know on the other side of the litigation when we win we will have a good 10-15 companies jump in, so our goal is to be a global player in every market,” he said. ®

Let Staff Go Rogue on Tech

Enterprise software vendors, are they getting a raw deal in the press or is it well deserved? Aivars Lode avantce

Let Staff Go Rogue on Tech

Companies Should Empower 'Shadow IT' From Their Most Technologically Disobedient Employees

By Christopher Mims

Most companies are playing whack-a-mole on 'unauthorized' software. Invision/Associated Press

Want to be more competitive? Then empower your most technologically disobedient employees.

If you're like me, the first thing you do when you join an organization is figure out how to avoid the Kafka-esque nightmare that is the company's own IT system. Because let's face it, in most organizations, what should be the simplest tasks—purchasing, booking travel, even email—are Byzantine compared with how we accomplish them on our own.

Which helps explain why 80% of people working for organizations with more than 1,000 employees go around the IT department and use (or even buy) software that lives primarily in the cloud, according to a recent survey by market-research firm Frost & Sullivan.

There are a dozen names for this phenomenon, but my favorites are the ones that make it sound as though downloading Dropbox or using Google GOOGL +0.19%Docs is like buying weapons from shady Eastern bloc arms dealers: "Shadow IT" or, less commonly, "Rogue IT." The phenomenon is also known as Bring Your Own Software, Bring Your Own Access, Bring Your Own Cloud, Bring Your Own Device or simply Bring Your Own Everything.

Perhaps there was a halcyon era when chief information officers were mostly occupied with making employees more effective, but in this age of increased regulation (Sarbanes-Oxley), security breaches (Heartbleed) and industrial espionage, the main task of a CIO at most companies is keeping customer data away from hackers and intellectual property out of the hands of rivals.

As you might imagine, CIOs aren't thrilled that most of their employees are dumping potentially sensitive data into Web-accessible, cloud-based applications they may have never heard of, much less vetted. But here's the thing: The companies that clamp down hardest on outside IT are ceding competitive advantage to those that empower employees to make their own decisions about what they need to accomplish their jobs.

Of course, it's not as if companies have much choice.

After interviewing a number of providers of cloud-based software about how they have managed to insinuate themselves into Fortune 600965.SH +4.36% 500 companies without hiring a single salesperson, here's what I discovered: Most companies are playing whack-a-mole when it comes to "unauthorized" software like cloud-storage services and productivity software. As soon as one group is banned from using a useful tool like Dropbox, someone somewhere else starts using it. Employees just want to do their jobs, and if corporate IT isn't moving as fast as they are, well, whose fault is that?

Here is a typical example of how Shadow IT makes people more productive: Many companies still control access to files employees share with each other by keeping the files behind a corporate firewall, or machines IT controls directly. The problems with this approach are myriad: Employees must be connected to their company's network to access the files; when they work remotely they have to access the files through a "virtual private network," which can be cumbersome on a PC and almost impossible on a mobile device. Cloud solutions like Box, Dropbox and others allow workers to access files anytime, on any device, and can even allow them to track all the changes others have made to a file. Many cloud applications also allow real-time collaboration. Google Docs lets multiple people write and edit in the same document simultaneously, and Lucidpress lets multiple people lay out and design the same document, each watching the others' changes unfold even as they make their own.

Even when it's time to pay for the (initially free) services employees have grown fond of, they are so much cheaper than traditional enterprise software from firms likeMicrosoft, MSFT +0.66% Oracle ORCL +1.26% and SAPSAP.XE -0.05% that they can be expensed on a credit card.

Roger Lee, a partner at venture-capital firm Battery Ventures, which invests in some software-as-a-service firms, calls this model of enterprise software "bought not sold" because employees are clamoring for these tools, whereas in the old days well-paid salespeople made fat commissions persuading C-level executives to adopt them.

The implications for makers of traditional enterprise software, who grew accustomed to a model in which employees had no choice but to use whatever software their company bought, are huge. Users are saying, why is this enterprise software product so bad? says Mr. Lee. The answer, fortunately, is it doesn't have to be.

Ease of use is a trait common to all the next-generation enterprise software that starts out as "Shadow IT." Just like consumer technology, these are systems that must "sell themselves," one customer decision at a time, at least until enough people within an organization use them so that corporate IT notices.

Once a shadow IT service is sufficiently popular, whoever is in charge usually conducts a formal analysis of the provider's security measures and compliance with appropriate regulations. As long as everything checks out, what started as an employee end-run around their own IT staff becomes institutionalized.

It's been said that every company is now a technology company, and if that's so, shadow IT is the logical extension of that: Every employee is now a technologist and should be treated as such. Thanks to "freemium" software, mobile apps and the cloud, people now have the power to provide their own solutions while crafting the workflows that are most effective for them as teams and individuals.

One survey, by Gartner, predicted that by 2015, 35% of the money companies spend on IT will be spent by employees who don't even work for the IT department. And PricewaterhouseCoopers found that at companies it rated as "top performers," more than 50% of IT spending was already happening outside the IT department. This suggests that firms concerned about the security issues of shadow IT are missing the point; the bigger risk is not embracing it in the first place.

2014 Georgia Tech Commencement: Ralph de la Vega of AT&T

A great speech by the CEO of ATT Mobility as to why we have to keep changing. Aivars Lode avantce