Power Shifting in Technology Business

The contrasting news and financial results from three of the world’s tech giants last week illustrates how there has been a shift in power in the industry the last couple of years. The three companies included Microsoft, IBM and Google.

Internet advertising and search giant Google posted results for the second quarter that were better than had been expected, but in direct contrast with IBM’s financial results.

Google’s second quarter growth in revenue was 22% and the company enjoyed one of its biggest in head count for a quarter increase this past quarter.

Patrick Pichette the CFO told analysts during a conference call that the increase of 2,240 employees during the three-month period were for the most part in research and engineering.

IBM meanwhile said its revenue for the second quarter dropped by 2% with a decline overall of 11% in revenue from hardware systems.

However, the results were better than from the first three months of 2014, when IBM’s revenue dropped by 23% partly because of a large decline in sales in its mainframe system, in the last few quarters.

IBM has suffered through slow hardware sales across China because of new economic reform and a move by certain banks in China and other large corporations to adopt the Chinese companies’ tech offerings.

Microsoft Corp was at one time the software company everyone feared. However, it announced it would be letting 18,000 employees go, many of which came to the company after Microsoft purchased the handset division of Nokia this past April.

Microsoft has struggled in an attempt to make a larger dent in the handset and mobile device market, where the Android operating system by Google remains dominant.

Microsoft’s Satya Nadella, the new CEO, said the company would be focusing much more on its operating system Windows Phone, for its mobile devices.

IBM is also now looking to become more involved in the mobile device market, at least on the corporate side.

On Tuesday, IBM announced it signed an agreement with Apple to develop apps for the Apple devices that are designed for specific types of industries.

 

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