There are companies that stir up interest and there are those that should go quietly into the annals of history.
The following 10 companies bear watching in the coming months. Some of these companies some will be unveiling new software, new contracts, new innovations, and expansion into new horizons. We will give these companies a "buy." others are in a hold pattern, and we will label them as such, as they linger a while longer for observation. The remainder are sinking the innovation ship, and we will mark them with a "sell."
Note that this list is about innovation, cloud computing, service offerings, and the future of these companies as seen from the eyes of a technical observer. The list has nothing to do with company stability, stock prices or inside information of any kind.
1. HP (Buy)
HP has turned itself into a formidable technology competitor in the past few years with its new CEO, purchase of EDS, and going head-to-head and winning against IBM for major contracts. HP (NYSE: HPQ) has fully engaged its innovation machine and is ready to take on the challenges of agile enterprise computing, including cloud and mobile. It's an exciting time at HP. Leo Apotheker at the helm means new life for the company, where innovation and the original HP ideals will thrive.
Steve Jobs is sold on HP, and Steve knows what's right and wrong with the technical world. A true Apple and HP collaboration would be a significant win for both companies.
If HP continues on its current path, IBM may have to stare at someone else's exhaust pipe for a change. Keep a close watch on that rear view mirror, IBM; for you, HP means "Hot Pursuit." Innovation, support and new leadership make HP a strong buy.
2. IBM (Buy)
Anyone who knows IBM's history also knows that IBM (NYSE: IBM) is the world's most innovative company. It holds thousands of patents. It invented cloud computing and virtualization. It was international before international was cool. It's where innovation got its definition. In the dictionary, next to the word, "innovation," it says, "See IBM." Its people are the best trained and the happiest group of tech folk that you'll ever meet. And, it's profitable.
What's the secret? It's IBM. It's a brand. It changes with the times. It has always had some of the best minds on the planet working on obscure projects and products that we now take for granted.
3. Solarwinds (Buy)
Solarwinds is the darling of every administrator who has anything to do with virtualization. Thanks, Solarwinds (NYSE:SWI) for being there. Solarwinds makes the products that make virtual environments tolerable. Seriously. And, it offers a gaggle of free tools for those who want to try before they buy.
There must be something in the water in Austin, Texas that brings out the innovation in these people. It's almost as if every tool you want is available from Solarwinds. If you aren't a system administrator, you wouldn't understand, but if you are, you probably already know Solarwinds.
Solarwinds builds tools for people who need them. Strong buy. And, as we say in Texas, "Watch 'em, they're fixin' to do somethin' cool."
4. Apple (Buy)
When you think Apple (NASDAQ: AAPL), you think innovation. You think simplicity. And, you probably think it comes at a high price. It does. But Apple's clever products, marketing and leadership make it a company that deserves your attention. Whatever it is, Apple probably thought of it first.
If Apple makes a tablet, others make a tablet. If Apple makes an app store, other make an app store. If Apple decided to manufacture Kangaroo clothes, everyone else would decide that Kangaroo clothes are the things to make.
The problem is, for other companies, that Apple would also have a line of must-have Kangaroo accessories as well.
Apple is the company to watch for consumer goodies, but what about servers and data centers? It's interesting to note that Apple has recently moved into the cloud realm with its iCloud service. This is likely to be its first step toward a major cloud-based Apple presence. First comes storage, then comes its operating system. Desktops delivered in the Cloud like only Apple could do it. Will it succeed where others fail?
5. EMC (Hold)
A year ago, EMC would have been a "Buy" but today, it's a Hold. Why the change for a company that owns one of the world's most successful companies (VMware)? One reason is a collaborative effort called The Open Virtualization Alliance. IBM, HP, Intel, and Red Hat have connected into an alliance to promote KVM virtualization, now owned by Red Hat (NYSE: RHT).
Why should this matter, you ask? If your company and several others created an alliance to promote Chevrolet, do you think you'd still continue to sell Fords? Maybe not.
IBM and HP also have their own storage solutions so EMC's SANs could be kicked to the curb in front of their data centers instead of occupying a nice cool rack inside them. It also seems that EMC's innovation has slowed to a trickle lately. Some large companies, like Oracle and EMC (NYSE: EMC) lose innovation through acquisitions. They acquire, scuttle, and move on.
EMC has tremendous market share and great products but the face of the competition is changing. Hold on this one to see what happens next.
6. Microsoft (Hold)
Microsoft is on innovation hiatus and has been for some time. Can you name the last truly innovative product from Microsoft? Me neither. Unless you turn back the clock to 1995 and say Windows 95. It seems that the new Windows look was the last innovative spark from Redmond. Microsoft (NASDAQ: MSFT) just hasn't kept up the pace on innovation like it did back in the Gates days. Maybe there's a connection.
Don't expect much from Microsoft in the next couple of years. It will get it together in 2014 or 2015 with something new, when we emerge on the other side of this recession, and Microsoft reworks its structure a bit.
Industry observers say Microsoft has lost its lucky charm or its heart, and it no longer holds the world for ransom. Linux and Apple have made significant dents in Microsoft's near monopoly on desktop operating systems. Now, with focus turning toward cloud-based services, Microsoft is losing its planetwide stranglehold on the soon-to-be-extinct fat desktop.
7. Citrix (Hold)
It's hard for me to say "hold" on Citrix because of the deep and historic love I have for that company. At one time, it would have been a strong buy but now it's in a holding pattern. It has changed the names of its products and acquired Xen, but no significant innovations in years have come from these guys. It's very disappointing.
That said, Xen powers Amazon.com's cloud offerings, and its software powers virtualized applications globally. There are companies like 2X out there that are hot on its tail with equivalent technology at a fraction of the price. Citrix XenApp isn't easy to install or maintain. XenServer is easy, but it doesn't have the third-party support of VMware. It's hard to put a finger on where Citrix is heading.
Many analysts have postulated that Citrix (NASDAQ: CTXS) and Microsoft should negotiate a Citrix buyout, although Oracle might be more of a contender for a Citrix purchase.
Citrix is a strong hold. Something good should come from the company in the next year or so. Stay vigilant and hopeful.
8. BMC (Hold)
The coolest new thing about BMC is its involvement in the OVA. BMC (NASDAQ: BMC) makes some cool software: Remedy, Patrol and BladeLogic, but I'm just not feeling the innovation of yesteryear. Ten years ago, these guys put the "it" in IT. The company still does some cool stuff, but I've felt a little slighted by its somewhat late arrival onto the SaaS scene. The company now offers Remedy as a service (awesome product), but it would have been great to have it five years ago. Eight years ago would have been even better.
Remedy is a great product and an online version is the best thing ever. But, sorry, BMC, you're still on hold. Let's get that early decade gray matter pumping again.
9. Oracle (Sell)
Oracle, like Microsoft, used to have the corner on its market, but that's rapidly changing. Its purchase of Sun Microsystems, which included MySQL, was an attempt to halt the diminishing relevance of its too-expensive-but-very-capable database system. But, not even MySQL can save Oracle now.
Oracle (NASDAQ: ORCL) has isolated itself from other tech companies, too. Not a wise business practice in these days of fierce competition and rising stars. Oracle may find itself pandering to the old school while its competitors are working the audience with innovation and pay-as-you-go pricing.It's OK though, Oracle has a few kicks left in it before it fossilizes completely. Larry Ellison is no fool. He'll purchase any innovation that he needs from another buyout. Sun is another good example of his buy, shell, eat, and toss the empty husks aside mentality. After he's done with Sun, it will be hard to figure out what he actually got out of his multi-billion dollar purchase.
Oracle is a "sell" company, although you should keep an eye on it. It's difficult to predict Larry's next move with any accuracy.
10. Computer Associates (Sell)
Computer Associates (CA) has never particularly struck the innovation nerve but its products are very popular. The product lines are easy to use but don't offer much in the way of innovation or clever design. It produced a line of cloud products that look promising. Something referred to as Cloud Solutions.
Cloud Solutions includes Turn-key Cloud, Cloud Security, Service Assurance, and others. Software as a Service (SaaS) and Platform as a Service (PaaS) tools are also available.
CA (NASDAQ: CA) is one to watch for future innovations on the cloud frontier. Its security tools have proven themselves in the data center and it will be interesting to watch its evolution in the cloud space.
Ken Hess is a freelance writer who writes on a variety of open source topics including Linux, databases, and virtualization. He is also the coauthor of Practical Virtualization Solutions, which was published in October 2009. You may reach him through his web site at http://www.kenhess.com.
Follow ServerWatch on Twitter