VDC Research: Industrial Sensing, Networking & Control Market Blog

Apple is Leading the Way for Bringing Back "Made in America"

Apple recently announced plans to manufacture at least one of its MAC computer lines in the United States in 2013. After reading with some interest in this news I harkened back to a blog I wrote on January 11th of this year in which I mentioned my belief that the time when "made in America" would mean something again was near. Little did I know it would have happened so quickly and would be driven by a company as high profile as Apple.

No doubt Apple may be making this move in large part due to its constant pressure and public criticism of the working conditions of its primary contract manufacturer, Foxconn, and that company's problems with worker unrest, worker suicides and reports of poor working conditions. I would also like to think that Apple's management was driven, if in just some small measure, by a general belief that America's future lies in its ability to rejuvenate a strong manufacturing presence on the world stage. I would have mentioned something like a sense of patriotic American spirit but that would be going a little too far, since after all Apple is a business.

I would like to think that some share (however small or large) of consumer and companies may consider buying an Apple device based on the belief that we, as Americans, need to support the success of our own country and begin to purchase more American made products whenever possible. I also blogged about an article written by Andy Grove (circa 12/10/12), Chairman Emeritus at Intel, on his similar belief that American companies have been hollowing out our long-term competitive advantage by continuing to outsource manufacturing jobs overseas in the constant need to please Wall Street's incessant demands for quarterly results, regardless of potential long-term implications of a short-term focus.

It is good to see that companies such as Apple are finally taking action to address the stark reality that this country faces in terms of rebuilding our manufacturing base, if not just for high value added manufacturing applications (search on Cisco blogs) in which America's innovative spirit and technology strengths are more fully exploited. I am certainly not foolish enough to think that someone at Apple read my blog and decided to move some of their MAC computer manufacturing oeprations back to the USA, but it is good to see that great minds do think alike.

Happy holiday wishes to one and all.

 

 

 

 

Recent Acquisition of Invensys Rail by Siemens, Is Invensys Operations Management Next on the Block?

Siemens recently announced its plans to acquire Invensys Rail for about $2.8 billion (~$1.7 billion Euro) and the deal is expected to close in Q2 2013 assuming it meets no regulatory obstacles.  In VDC's opininon this deal thereby opens up the possibility that Invensys may also spin off its Invensys Operations Management and Climate Controls businesses as a means of maximizing its value to shareholders, something that was at least speculated based on reading some articles in June and September of this year.

Apparently there were (are?) several interested parties in a possible acquisition of Invensys Operations Management (or perhaps Invensys overall) including Emerson, ABB and GE. An acquisition of IOM by anyone of these companies would definitely represent a major shake-up in the competitive landscape as it would bring in over $1.6 billion in revenues and a great deal of sizeable customer accounts and a pretty strong product portfolio including leading brand names such as Foxboro, Eurotherm, Wonderwre and Triconex, among others. The addition of such a product, solutions and services portfolio to anyone of these rumored acquirers would be a real competitive advantage.

I have written several blogs in the past regarding my analogous use of PAC Man to explain industry consolidation occuring in any number of different product and technology markets. If an acquisition of Invensys overall and/or Invensys Operations Management went down then that would represent a pretty sizeable example of PAC Man in action. You can learn more about several of the key markets in which Invenys and its rumored suitors compete by checking out VDC's Industrial Automation practice homepage.