US technology M&A insights 2010

Download US technology M&A insights 2010

This annual report sets out analysis and commentary on the US technology industry’s principal trends, driving forces and outlook for the coming months, both in aggregate and by key sectors: software, Internet, semiconductors, IT services, and hardware and networking.

The M&A community looked in vain for signs of improving conditions through the first half of 2009 until a number of high-profile transaction announcements by the end of the second quarter such as Sun, Data Domain and Wind River broke the logjam. As summer turned into fall and markets began to regain some ground, CEO confidence grew that the bottom had been reached. In tune with those sentiments, technology deal makers shifted into high gear and doubled the number of deals closed during the second half of the year. As we enter 2010, optimism has once again emerged, this time from technology analysts who predict a cyclical industry revival in the first half of the year as companies around the world come to grips with the new "normal" and rekindle technology purchases.

There are some rather significant secular changes unfolding:
  • Technology powerhouses continue to blur the historical demarcations among software, hardware and services
  • Cloud computing and software as a service models are rapidly realizing their potential, pushing players to fill out their offerings quickly to lock in customer transitions
With these underlying forces at work, and as long as the broader economy can avoid slipping back into recession, we expect 2010 to witness a return to more robust deal making.