Technology B2B lead: Cloud initiatives motivate competition, collaboration
Cloud initiatives motivate
Border between B2B and B2C becomes more porous
Business-to-business technology brands competed for dominance in cloud computing and collaborated to leverage complementary strengths and expand customer bases, often reaching across the increasingly porous industry border to business-to-consumer brands. Propelled by the combination of successful business model transformations and the tailwind of a strong global economy, most brands increased in value, some substantially.
Acknowledging how the way people live and work has changed in the 35 years since Bill Gates announced his Windows idea, Microsoft planned to shift priorities away from this heritage product to Azure and cloud computing. Microsoft increased in value 40 percent, because of its transformation to an open platform, enabling it work in collaboration with other brands, and the development of its cloud storage business.
Second in cloud storage after market-leader Amazon, Microsoft entered a partnership with software provider SAP. Microsoft moved some of its SAP applications to the SAP cloud, and SAP agreed to use Azure services inside the company. SAP accelerated its move into cloud with the acquisition of a sales and marketing company called Callidus Software.
With several initiatives, Google attempted to gain on Microsoft and Amazon in cloud storage and expand its B2B presence. Google and Cisco agreed to work in partnership to create a hybrid cloud, enabling businesses to create apps that work in their own data systems and on Google’s servers. The arrangement helps Cisco move deeper into cloud computing and Google move deeper into B2B. Google is making available software products based on the software developed to run Google.
Cisco is not developing its own cloud storage, but rather intends to help its customers manage and optimize their use of cloud. It derives over half of its revenue from building internet infrastructure. Oracle planned to build 12 new cloud data centers worldwide over the next few years. In partnership with Tencent, the company is locating one of the centers in China. The centers should help Oracle deliver its business management and analytic products.
China’s Huawei is rapidly developing 5G networks, although its progress may be slowed by security concerns about having voluminous consumer data exposed to the Chinese government. Huawei denies any affiliation with the government and, except in the US, security concerns have not substantially limited Huawei’s growth as a 5G infrastructure developer and maker of the world’s third best-selling smartphone, after Samsung and Apple.
Rising brand value
Companies that create the tools to run businesses have significantly caught up with the shift to cloud and rose substantially in brand value, led by Adobe, with a 53 percent increase in value. Adobe achieved strong earnings, driven by its successful transition to cloud, with cloud subscription services producing the vast majority of revenue.
Salesforce continued to expand services to its cloud customers with the acquisition of MuleSoft, a service that helps companies move data in their legacy systems to integrate with other data stored in the cloud. It selected Google as its preferred cloud partner and connected Google apps and analytics to Salesforce.
LinkedIn spent its first full year as part of Microsoft, which acquired LinkedIn in part to compete with Salesforce. Among the integration initiatives, was the plan to combine two sales management tools: Microsoft Relationship Sales and LinkedIn Sales Navigator. In another example of integration, LinkedIn résumé writing tool linked with Microsoft Windows and Office 365.
HP, the hardware company spun off from Hewlett Packard two years ago, experienced strong sales for its PCs, particularly powerful high-end models designed for serious gamers, even as PC global sales softened. HP’s premium laptop and printing businesses also performed well, and the company invested in 3D printing.
Intel continued its transformation into a data-centered company. Investments in cloud, network, and AI produced revenue gains. Intel acquired Mobileye, an autonomous car business. In a series of ads titled “The Future,” Intel attempted to allay public anxiety about the impact of technology and also position the brand as forward-looking and empathetic. It demonstrated its wizardry with a drone performance during the opening ceremonies of the Olympic Winter Games in Pyeongchang, South Korea.
Accenture partnered with Apple to develop new tools and services for helping enterprise clients transform how they engage with customers using iPhone and iPad. The initiative is intended to facilitate the smooth transfer from legacy infrastructure to iOS apps. The Apple partnership followed collaborations with other brands, including Google, Microsoft, and Oracle.
IBM increased sales as it continued its strategic shift from its legacy businesses to security, cloud, and AI, initiatives that accounted for almost half of IBM’s revenue. IBM invested in its Watson-branded artificial intelligence initiatives, particularly its commitments in healthcare and finance, which grew, but slower than analyst expectations. To accelerate its new businesses IBM partnered with other technology leaders, including Apple. And to communicate its progress, Watson analyzed clothing worn by celebrities at the Grammy Awards to predict fashion trends.