New Paychex CEO Leads Company To SaaS

Paychex, with annual revenue of $2 billion in fiscal 2010, recently reported its first SaaS acquisition. Competition was heating up for Paychex as Intuit and ADP continued to make SaaS acquisitions. Intuit, since acquiring PayCycle in 2009, has emerged as a strong threat to Paychex in the small business segment. Paychex has finally risen to the challenge.

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Netflix Should Not Get Too Comfortable

According to Digital Entertainment Group, in 2010 total revenues from DVD, Blu-ray, and digital sales of movies and television shows in the U.S. fell 3% over the year to $18.8 billion. In 2010, sales and rentals of standard DVDs fell 11% over the year to $14 billion. In the same period, Blu-ray sales and rentals grew 53% over the year to $2.3 billion, while downloaded and streamed content revenues grew 19% over the year to $2.5 billion.

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Amazon Aligned With Multiple Major Trends

ComScore holiday sales estimates show that overall online retail sales in the U.S. grew 12% over the year to $32.6 billion for the two-month period of November and December. For the holiday season, e-tailer Amazon saw record sales on Cyber Monday, with 13.7 million items sold worldwide; this translates to 158 items sold per second. The numbers were 44% higher than the previous year’s record holiday peak day sales of 9.5 million items, or 110 items per second. Meanwhile, for the current year, market researcher Forrester estimates e-commerce spending growth to continue at 12% to $197.3 billion.

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Microsoft Scores With Kinect But Needs A Tablet Strategy

According to Gartner, global personal computer shipments in the quarter ended December 2010 increased 3.1% over the year to 93.5 million units, falling short of the anticipated 4.8% growth for the period. Gartner attributed this lower-than-expected growth rate to rising competition in the form of tablets and other devices such as game consoles. For the same period, IDC reported that worldwide PC market increased a modest 2.7% over the year. The report claims that total shipments for 2010 increased 13.6% over the year to 346.2 million units.

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Nokia Wakes Up

Nokia last week reported weak fourth quarter earnings and provided a weak outlook as its market share continues to decline in a competitive market. This was the first full quarter under the new CEO, Stephen Elop. Last quarter, Elop announced plans to restructure Nokia’s smartphone business by cutting 1,800 jobs, and this quarter he acknowledged the need for a strategy change in a fast-changing and highly competitive industry. >>>

SAP Looking Good

SAP (NYSE:SAP) reported record fourth quarter revenue this week and growth in all segments driven by pent-up corporate demand. However, its profits took a hit due to the $1.3 billion payment to Oracle following the verdict of TomorrowNow lawsuit.

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Is Content Or Web 3.0 The Answer For Yahoo?

According to ComScore, for the third quarter of last year, Facebook led the display ad market in the U.S. Overall display ads grew to 1.3 trillion displays, registering 22% growth over the year. Facebook alone had 297 billion display ad impressions in quarter, translating to 23.1% market share compared with 9.2% in the previous year. Yahoo! came in second with 140 billion impressions or 11% market share, followed by Microsoft’s 5% share or 64 billion impressions. To counter Facebook’s growth in the display ad business, Yahoo! seems to be focusing on improving content. >>>

The Implications Of Google’s Management Change

By all measures, Google is going gangbusters. It has made a major management change, but let’s first look at the results and then analyze the change in context.

With the market recovering, online ad spending is on the rise. According to eMarketer, a marketing research firm, total online ad sales in the U.S. increased 13.9% over the year, with search advertising growing 15.6% and online display advertising 17% in 2010. In the coming years, the display advertising market is expected to continue to expand rapidly, driven by strong growth in video advertising: Online video advertising is expected to drive online display ad growth by increasing 34% annually until 2014. Banner ads will increase between 7% and 16.2% annually from 2009–2014. Total U.S. online advertising spending is expected to be $18.84 billion in 2014 compared with $12.37 billion in 2010. Of this, display ads will account for $15.92 billion compared with $7.58 billion in 2010. >>>

EBay Should Acquire TheFind

According to ComScore, online sales in the U.S. in November and December grew 12% over the year to $32.6 billion. Cyber Monday, the Monday following Thanksgiving, was the biggest online spending day of the holiday season in the U.S. with sales of $1.028 billion. This was the first time ever that online sales crossed the billion-dollar mark in a single day. According to the report, free shipping offers helped to fuel such strong demand. Green Monday, the second Monday of December, was the second-biggest day with sales of $0.95 billion.

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IBM At A Record High

IBM (NYSE:IBM) this week reported strong results that beat estimates driven by increased tech spending. Ten years ago, IBM made a strategic shift to higher-margin software and services while divesting its low-margin commoditized businesses such as computers. That shift in strategy has paid off: IBM reported almost $100 billion in revenue in 2010 and plans to add $20 billion more by 2015. >>>