Hewlett-Packard, once a PwC suitor, says it has been approached by the consulting firm several times throughout the past year, even as recently as two weeks ago.
Competitors reacted swiftly and negatively to the news that IBM plans to buy PwC Consulting in a deal worth $3.5 billion.
Hewlett-Packard, once a PwC suitor, says it has been approached by the consulting firm several times throughout the past year, even as recently as two weeks ago. (In November 2000, HP backed out of a deal to buy PwC for $18 billion.) But now Juergen Rottler, a VP at HP, says that even at a more attractive price, it no longer fits with HP's strategy as it once would have.
"At the end of the day, most customers have relationships with the partner more than the company," Rottler says. "IBM will be very busy convincing the partners that it's a good deal for them, and the partners will be busy convincing the customers."
And from the "glass houses" corner, Mitch Hill, CEO of Avanade Inc., the joint venture between Microsoft and Accenture, says CIOs should be cautious about vendor bias in dealing with the new consulting business. "We can safely say that any independence PwC would have had is compromised," he says, adding that his firm isn't affected in the same way because it doesn't sell products. Most of Avanade's customers "usually engage us because they want to do something" with Microsoft, he says.
The $3.5 billion deal is IBM's largest acquisition, but it's a bargain-basement price considering that PwC's projected revenue for 2002 is an estimated $4.9 billion. As for the criticism by the competition, John Connolly, general manager of the strategy and change practice at IBM Global Services, seems unfazed: "We were delighted to be able to do this deal, and HP can respond to it" as it will.
How Enterprises Are Attacking the IT Security EnterpriseTo learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Infographic: The State of DevOps in 2017Is DevOps helping organizations reduce costs and time-to-market for software releases? What's getting in the way of DevOps adoption? Find out in this InformationWeek and Interop ITX infographic on the state of DevOps in 2017.
2017 State of IT ReportIn today's technology-driven world, "innovation" has become a basic expectation. IT leaders are tasked with making technical magic, improving customer experience, and boosting the bottom line -- yet often without any increase to the IT budget. How are organizations striking the balance between new initiatives and cost control? Download our report to learn about the biggest challenges and how savvy IT executives are overcoming them.