Top of the Order:
How to Save a Trillion: Last month, a bunch of bigwig tech executives met with President-elect Donald Trump in New York. Apple’s Tim Cook was there. So were Oracle’s Safra Catz, Amazon’s Jeff Bezos and investor and Trump supporter Peter Thiel. In some ways, it looked like the nation’s tech titans — many of whom either didn’t support Trump or were flat-out against his presidential bid — were trying to make peace with the man who will be the nation’s ultimate chief executive for the next four years.
When you’re going to meet the boss, it helps to tell him or her something they will like. And one of the things bosses like most is being able to save money. For politicians, this means the ability to tell the voters, “Look what I did for you.” And on that day in December, those giants of the tech sector presented Trump with a plan to save the government more than $1 trillion over the next 10 years.
Billions of bucks is one thing, but when you’re talking about the federal government, mention the word “trillion” and you’ll get someone’s attention. That was the plan laid out by IBM CEO Ginni Rometty and the other tech leaders, as they presented Trump with ideas that could save the government all that dough by, you guessed it, enacting a slate of new tech-based policies.
Such ideas should come as no surprise, since this is a group of executives from the tech sector. Among the proposals are improvements in supply chain operations ($500 billion), getting rid of fraudulent payments ($270 billion) and just modernizing IT facilities and operations ($110 billion).
The idea, which Rometty appears to be spearheading, would be to use that $1 trillion for a widespread infrastructure overhaul and the creation of thousands of “new collar” jobs. Rometty laid out some of her ideas in an open letter to Trump shortly after November’s election. She put IBM’s money where her mouth is when, just before the tech leaders met with Trump, she said IBM would hire 25,000 new “professionals” in the U.S. and spend $1 billion on skills training over the next four years.
Saving money and putting people to work? If he takes the tech leaders’ suggestions to heart, Trump may just be able to keep at least one of his campaign pledges. Who knows? He might even get on the good side of some Bay Area tech workers who, for now, are already lining up against him.
Middle Innings:
Working Through It All: Microsoft officially completed its $26.2 billion acquisition of LinkedIn a few days after Christmas. That doesn’t mean that all the work involved with bringing LinkedIn’s 10,000 employees into the Microsoft universe is complete, however.
And it also means that LinkedIn’s CEO, Jeff Weiner, isn’t out of a job, yet.
In a move counter to how most acquisition integrations are handled, Microsoft CEO Satya Nadella put Weiner in charge of ensuring that the deal proceeds smoothly between LinkedIin and its new corporate overlords. Business Insider said that Nadella made the decision to have Weiner run the integration last summer, around the same time Microsoft made its acquisition plans public.
There may be one change in store for all of LinkedIn’s employees that wasn’t foreseen: They may have to give up their use of Google Apps and Gmail. Google is reportedly concerned about such a large rival having use of its products.
The Fits Keep Coming: Fitbit shares took a hit earlier this week, falling around 6 percent after it became known that the fitness watchmaker would acquire the software assets and design team of one of its smaller rivals, Vector. That deal didn’t make Fitbit investors happy at all, and they may soon have more reasons to test their patience.
According to a report from Cleveland Research, Fitbit put the stop on device production during December because its inventories were building as its watches weren’t moving as fast as hoped from retailers’ shelves. That’s not the kind of thing any tech-gadget maker likes to hear about during the Christmas shopping season, which is usually a built-in bonanza of consumers’ dollars. When Fitbit reports its quarterly results in a few weeks, we’ll all find out how well its business fared over the holidays.
Bottom of the Lineup:
Here’s a look at how some leading Silicon Valley stocks did Thursday.
Movin’ on Up: Gains came from Finisar, Sigma Designs, 8×8, Impax Laboratories and Ultra Clean Holdings.
In the Red: Decliners included Gigamon, ServiceSource International, Advanced Micro Devices, SunPower and Super Micro Computer.
The tech-focused Nasdaq Composite Index fell 0.3 percent to 5,547.49.
The blue chip Dow Jones Industrial Average gave up 0.3 percent to end the day at 19,891.
And the broad-based Standard & Poor’s 500 Index shed 0.2 percent to finish at 2,270.44.
Quote of the Day: “I was part of the journey of a remarkable man who did remarkable things.” — Vice President Joe Biden, after President Barack Obama surprised Biden by awarding him the Presidential Medal of Freedom at the White House on Thursday.
Sign up for the 60-Second Business Break newsletter at www.siliconvalley.com.
