Google Editions Embraces Universal E-book Format

Google will launch an e-book store called Google Editions with a "don't be evil" twist. This will allow content to be unchained from expensive devices such as Amazon's Kindle e-book reader. Unlike Google's biggest competitors Amazon and Barnes & Noble that rely heavily on restrictive DRM, Google will not be device-specific - allowing for e-books purchased through Google Editions to be read on a far greater number of e-book readers that will flood the market in 2010. Google's e-books will be accessible through any Web-enabled computer, e-reader, or mobile phone instead of a dedicated device.

However, as democratizing as this sounds, it's still unclear how many people are ready to curl up with a Google Editions title on their laptop or smartphone, instead of the traditional paper format? Under Google's payment scheme, publishers will receive about 63 percent of the gross sales, and Google will keep the remaining 37 percent. Google Editions: The Basics The new e-book store will launch sometime during the first half of 2010, and will have about 500,000 titles at launch. Google also hopes to offer Editions titles through other online book retailers. Google may also create deals to sell Google Editions books directly through a book publisher's Website, but no details have been announced for how that scenario would work, according to Read Write Web. In this scenario, online retailers would get 55 percent of revenues minus a small fee paid to Google, and publishers would get 45 percent.

Google Editions as Web Apps? Unlike titles offered through e-readers, Google Editions books would not have to be accessed through a dedicated reader or special application. Google's e-books would reportedly be indexed and searchable like many books are now through Google's Book Search, according to Reuters. Instead, any device with a Web browser will be able to access a Google Editions book. To me this sounds like Google wants to turn the e-book, or more accurately the e-reader, into a Web App.

After you purchase and access your online book for the first time, it will be cached in your browser making the book available when you're offline. Considering Google's push with its yet-to-be-unveiled Chrome OS and the Chrome browser, turning books into Web Apps isn't a particularly surprising move. Whenever Google gets involved with any new business, the immediate assumption is that the company will be able to reshape the market. But is Google Editions a Game-Changer? From the sounds of it, Google's plans may do just that, since it will make reading and accessing e-books nearly universal on almost any device that can get to the Web.

Google's use of the Web browser as an e-reader may make it slightly easier to access an e-book than these other retailers since Google will essentially shun the ePub and PDF formats. However, Google is not the first company to deliver e-books to your PC. Companies like Buy Ebook and eBooks.com already do this, and the online social publishing site, Scribd started selling e-books earlier this year. But one hurdle Google can't overcome is the fact that you'll be reading your book on a computer screen. Part of the reason Amazon's Kindle gained so much attention when it launched was its attempt to overcome this deficiency by using E-Ink technology, which tries to emulate the look of the printed page. A common complaint about e-books is that reading them is much harder on a regular computer display. Sure, alternatives like the iPhone's Kindle application, and other e-reading apps for smartphones have met with some success.

Dell agrees to buy Perot Systems for $3.9B

Dell has agreed to buy Perot Systems for around US$3.9 billion in cash, and intends to make the company its global services delivery division, the companies said Monday. It will also allow Dell, in the future, to address customer demand for next-generation services including cloud computing, said CEO Michael Dell in a conference call with analysts. The deal will allow Dell to expand its range of IT services, and potentially allow it to sell more hardware to existing Perot customers, it said.

Dell is counting on its international reach to turn Perot into a global services company, Dell CFO Brian Gladden said during the call. Around 25 percent of revenue comes from government customers, he said. Perot Systems is one of the largest services companies serving the health-care sector, from which it derives about 48 percent of its revenue, its CEO Peter Altabef said during the call. Perot is already working at increasing its international revenue: on Friday it announced a 10-year deal to outsource IT operations for Indian hospital group Max Healthcare. Over the last four quarters, Dell and Perot together had revenue of $16 billion from enterprise hardware and IT services, with $8 billion coming from enhanced services and support, Dell said.

Dell's rival Hewlett-Packard expanded its own global services unit with the acquisition of EDS for $13.9 billion in May 2008. EDS was founded by H. Ross Perot, who sold the company to General Motors before going on to found Perot Systems, of which his son is now chairman. Perot's contribution to that is relatively small: In 2008, the company reported total revenue of $2.78 billion. In after-hours trading, the stock traded at $29.70 early on Monday morning. At $30 per share, Dell's offer represented a significant premium over Friday's closing price of $17.91 for Perot Systems shares. The boards of Dell and Perot agreed to the terms of the transaction on Sunday, they said. Dell expects that overlaps between the two companies will allow it to cut Perot's costs by between 6 percent and 8 percent, Gladden said during the conference call.

Dell expects to complete the deal in its November-to-January fiscal quarter. Upon completion of the acquisition, Dell plans to make Perot Systems its services unit, and will put Altabef in charge of the unit. The services unit will fit alongside Dell's existing divisions for selling to large enterprises, government customers and small and medium-size businesses. It also expects Ross Perot Jr., chairman of the Perot Systems board, to be invited to join the Dell board of directors. Dell created the three divisions in a major reorganization of its business sales teams last December, shifting from a geographic structure to one aligned with customer types.

DOJ clears way for AT&T-Centennial deal

The U.S Department of Justice gave a tentative thumbs-up Tuesday to AT&T's proposed acquisition of Centennial Communications provided AT&T divests some of its network assets in Louisiana and Mississippi. The DOJ claims that AT&T and Centennial are each other's closest competitors in parts of the two states and that any "proposed settlement requires divestitures in those areas to eliminate competitive concerns." For its part, AT&T says it has already agreed to sell assets to Verizon Wireless in "five of the Centennial service areas covered under the DOJ ruling." The company still has to divest itself of assets in three remaining services areas before the DOJ will officially sign off on the deal, however. "We are pleased with the Department of Justice's decision and see it as an important step toward closing our acquisition of Centennial," says AT&T general counsel Wayne Watts. "The combination of AT&T and Centennial will bring together two complementary wireless businesses and will produce meaningful benefits for customers of both companies." AT&T first announced its plans to buy Centennial, a regional provider of wireless communications services, last November for $944 million. Hottest tech M&A deals of 2009 The DOJ's Antitrust Division said that as originally proposed, the merger would "substantially lessen competition" and "likely would result in higher prices, lower quality and reduced network investments" in certain areas of Mississippi and Louisiana. The purchase was AT&T's second major purchase of a wireless company that month, as a week earlier the carrier purchased Wayport, a network and applications management company that provides back-office management for Wi-Fi hot spots.

Centennial has a total of 1.1 million wireless customers and has a particularly strong presence in Midwestern states such as Michigan, Ohio and Indiana. In purchasing Centennial, AT&T says it will improve its wireless coverage in several rural areas in both the continental United States and in Puerto Rico. The wireless company also has a significant footprint in Louisiana, Texas and Mississippi.

For sale: Cisco data center rival Brocade

Brocade has reportedly put itself up for sale, a development that portends significant consolidation within the data center IT industry. Likely suitors are HP and Oracle, among others, the WSJ reports. According to the Wall Street Journal, Brocade has enlisted Qatalyst Group to shop the company around.

HP, Oracle and Brocade all declined comment for the WSJ story. HP would be interested in Brocade to fill out its data center switching and storage-area network (SAN) portfolio as it battles former ally Cisco for next-generation data center buildouts. Brocade, which told Network World it does not comment on "rumor or speculation," has a market cap of $3 billion. HP resold Cisco routers and switches for years before ramping R&D in its own ProCurve line.   Slideshow: 2009's hottest tech M&A deals   Cisco countered by developing a data center blade server system to compete with HP's and IBM's offerings. Acquiring Brocade would fill out both its LAN and SAN switching portfolios for the data center, observers note.

IBM is also a reseller of Cisco switches and routers but recently agreed to OEM Brocade's equipment, which it obtained from its acquisition of Cisco rival Foundry Networks.   HP resells Brocade FibreChannel and FibreChannel-over-Ethernet (FCoE) SAN switches under an OEM arrangement but is challenged in offering a complete data center switching line via its internally developed ProCurve brand. Similarly, software giant Oracle would become a more complete player in the data center with a Brocade acquisition. But some analysts say Brocade would be a stretch for Oracle, and perhaps too disruptive near term for HP. "Much has to do with Oracle's long-term growth plans," states Oppenheimer & Co. analyst Ittai Kidron in a bulletin on the Brocade speculation. "If the company truly plans to become a systems company (one-stop shop software/hardware), then Brocade would be a nice fit, especially including Sun Microsystems with no overlap. Oracle is in the process of acquiring Sun Microsystems for more than $7 billion, which gives it server hardware and software; Brocade would give Oracle LAN and SAN switching hardware and make the company a powerful provider of hardware as well as software. We're a bit in the dark on strategy here.

That said, there would be massive overlap with HP's ProCurve networking unit, which we believe would be disruptive. On HP, Kidron writes: "Brocade would add the missing data center switch architecture as well as a strong presence in the SAN switch market. Also, IBM and EMC are 10% customers for Brocade and could be lost as customers (along with HP's 10% business of Brocade)." If HP acquired Brocade, business from IBM and others could swing back to Cisco, according to UBS analysts Nikos Theodosopoulos. Speculation has it the company will flesh out its Project Stratus cloud computing strategy and/or announce a significant alliance or acquisition with a major IT player. A dark horse in the Brocade stakes would be Juniper, according to investment firm UBS. Juniper and IBM are tightly aligned in data center and cloud computing, and a Brocade acquisition would flesh out much of what's missing in the IBM/Juniper data center arsenal - specifically, an FCoE line of switches. "We believe Juniper may be another potential buyer of Brocade, although recent commentary from Juniper suggests it is not looking at large deals now," UBS analyst Theodosopoulos states in a bulletin on the prospects of a Brocade acquisition. "An acquisition of Brocade would make sense for Juniper, in our view, because it is the only other clear networking partner for IBM, while IBM is currently supporting Juniper's development of an FCoE switch, alleviating some of the R&D budgetary constraints on Juniper as it pursues both LTE & FCoE technologies." Juniper has a major announcement slated for Oct. 28 in New York. IBM may also be interested in Brocade but that would dash its Juniper partnership, kill HP and EMC as 10% revenue customers, and get IBM back in the network and SAN hardware business which may not appeal to the company, Kidron notes.

Acquiring Brocade would give Dell, a maker of servers for the data center, more credibility in that market with minimal overlap, according to Kidron. Another wild card is Dell. But Dell just acquired Perot Systems last month for $4 billion so the prospects of making another major acquisition so soon after is remote, Kidron states. No deal is imminent for Brocade and the company could still dash a potential deal, the WSJ reports. That doesn't necessarily rule them out though. "I think Dell could potentially make a play for them; I've heard through some of their channel that there is a big push for capturing some [data center] share," says Frost & Sullivan analyst Vanessa Alvarez.

But proactively seeking out possible acquirers may give the company more control over the process and over its destiny, observers note.

Apple pushes unnecessary software to Windows PCs

Apple again used its software update tool to push a program that was previously not installed on a PC, according to Computerworld tests early Monday. Apple's Software Update for Windows - a utility most often installed on PCs when users download iTunes - was offering something called "iPhone Configuration Utility" to Windows users, even to machines that have never connected to an iPhone. Later in the day, however, Apple removed the software from the update list.

Popular Windows blogger Ed Bott first reported on ZDNet that the tool was included in new updates. The tool, chimed in Simon Bisson of itexpertmag.com , is actually an enterprise-grade tool for network administrators, who use it to create and deploy device profiles so users can securely connect to a company's Exchange mail servers. Computerworld confirmed that the 22MB download was offered to PCs, including those running Windows XP Service Pack 3 (SP3) and Vista SP2, that had never been used to synchronize an iPhone. According to Bisson , the iPhone Configuration Utility also adds the open-source Apache Web server software to the PC. "The thing with that iPhone config utility is that it's an enterprise tool for building device profiles. Apple has been criticized in the past for using its software updating service to push unwanted software.

It's not for consumers!" Bisson said on Twitter. Last year, for example, the company came under fire for offering Safari for Windows to users who had not installed the application, going so far as to pre-check the program so that users who simply accepted the default downloads received the browser. Later, Apple quietly changed Software Update so that Safari was unchecked, requiring users to explicitly request the browser. John Lilly, the CEO of Mozilla, the open-source developer responsible for Firefox, said Apple's tactic "undermines the Internet" because updates are traditionally used to patch or fix existing software, not install new programs. By 3:30 p.m. ET, Apple Software Update had dropped the iPhone Configuration Utility as a potential update to the same PCs that earlier had indicated the tool should be downloaded. Apple did not immediately respond to questions about why the iPhone utility had been offered, and whether the company had erred in listing it as an update for Windows users.