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When tech titans join forces: The verdict on 6 big mergers

John Brandon | March 5, 2014
Some things go together like peanut butter and jelly. Others are more like peanut butter and motor oil. The joining of tech titans is no different. Here we discuss whether six high-profile mergers have made a tasty combination or a gross one.

"This loss-making division was supposed to usher in an era of new devices built entirely by Google," says David Braun, the CEO of Capstone Strategic, a company that analyzes mergers. "Unfortunately, Moto X ... performed poorly in comparison to comparable devices. Google's failure with Motorola was partly due to issues with integrating Motorola with Google's existing hardware division and with the company as a whole."

One of the most interesting combinations in tech, the HP acquisition of Palm in 2010 for $1.2 billion was intended to fuel the creation of new products, namely tablets and smartphones. (Back then, they were new.) King says HP failed to capitalize on the acquisition with outright incompetence, a lack of strategy, and poor execution.

Indeed, HP recently sold Palm's WebOS interface to LG, which plans to use the OS on televisions, and its Palm and iPaq patent to Qualcomm. Since then, HP has picked Microsoft, Chrome and Android as their platform of choice in products such as the HP Chromebook 14 and the HP Slate 21 Pro.

EMC and VMware: A Decade Later, Still a Strong Marriage
Another success for tech titan unification, this merger from 2003 for $635 million represents a good example of two companies with complementary product offerings (storage and virtualization, respectively) creating a stronger whole. A decade later, EMC's VMware buy proves two large successful companies can blend into one. "VMware fit in with EMC's desire to supply more than storage, and VMware's enterprise software has become a key means for EMC to maintain its relevance," Enderle says.


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