HP Poised to Buy EDS

Hewlett Packard and EDS are expected to announce a deal soon where HP will aquire the data services company for about 13 Billion. This deal will make Hewlett Packard the number two global provider of enterprise technology services (IBM is number one). HP, however, is already the world's largest manufacturer of computers with no competition from IBM in that department because IBM sold their entire computer manufacturing business to China's Lenovo some time ago.

The move is likely to allow HP to consolidate several management functions as well as enlarge their services footprint considerably. This will make them more competitive with IBM, which is the ultimate goal of the buyout of EDS.

San Jose Mercury News: Too Old?

There is a great summary at Business Week of the remarkable rise and pending potential fall of Silicon Valley’s newspaper - the San Jose Mercury News. BW notes that in many ways the Mercury News saw it all coming, but still failed to position itself to profit from the migration of offline info to online info.

Although the article does not make this point, I'd suggest that the failure supports the idea that paradigm shifts do not come from old systems evolving into new ones even when the old systems “get it”, rather they come from new folks thinking out of the old boxes and building the next generation of innovative solutions basically from scratch.

Obviously new technology almost always rests on the shoulders of old technology, but it seems reasonable to assume that the next big things are not going to come from the previous big things, they are going to spring up from the harsh, quirky, and shifting sands of technology, inspiration, and innovation.

I would suggest that IBM might be an exception to this notion but clearly Microsoft, then Yahoo and Google, now YouTube, Myspace and Facebook all fit this model of major online changes coming more from scratch than from a slow simmering of existing ideas. This also helps explain the challenges of venture capitalists as they try to find “the next big thing”, a company that may only be known by the glimmer in a college kid’s eye.

If so, who is next?