To wit, Barclays’ latest CIO survey, which shows the so-called “consumerization of IT” in full swing. The research house polled 100 CIOs — 65 in the U.S. and 35 in Europe — across varied industries, and found a solid uptick in tablet adoption.

A staggering 93 percent of respondents noted some level of interest in tablets, with 40 percent saying the devices are already in use at their companies, and another 36 percent saying they were either trialing or testing them. Interestingly, 40 percent of respondents described tablets as an incremental hardware purchase. Another 40 percent said the tablets they purchased would be used to replace laptops.

And what sorts of tablets are these folks buying or trying? They run the gamut, really — with a strong leaning toward the market leader.

“Apple was the vendor most often cited, but there was also interest in Microsoft and Android tablets as well (RIM fell from our prior survey),” Barclays analyst Ben Reitzes explains. “We believe that given Apple’s strength in the smartphone and tablet markets the company is seeing higher rates of adoption in the enterprise market as a result of the BYOD trend.”

All of this, of course, bodes well for the tablet market and for Apple, which continues to drive it — particularly with corporate spending on tablets clearly on the rise.

And now, for your listening pleasure, Flight of the Conchords, with “Business Time”:

That’s the scenario Barclays analyst Anthony DiClemente sketches out in a new note. He figures that Apple could certainly come up with a cool piece of hardware — he imagines one that looks like a “large-scale iPad” — that would tie together the Internet with Apple’s existing suite of iOS apps and services.

But DiClemente doesn’t think Cook will be able to break open the traditional cable TV bundle. Which means that if you watch TV on Apple TV, it’s going to look a lot like the TV you’re already watching now. And it will cost the same to get that stuff to your set.

DiClemente is a media analyst, not a hardware guy, and his report focuses primarily on the reasons it will be so hard for Apple — or anyone — to truly disrupt the TV programming/distribution business. But here’s some of his speculation about the box, which is similar to other industry guesses:

• He doesn’t think it’s coming in 2012.
• He thinks it will use Apple’s Siri voice control as a “groundbreaking interface.”
• He imagines it could sell for $1,500.
• He thinks it could be “so much more than a TV — including gaming, video communication, content delivery, apps, computing and all the capabilities of the current Apple TV.”

All good, so far. But again, the problem will be when it comes to the TV programming part.

DiClemente argues, convincingly, that TV programmers don’t have any incentive to stop selling the bundles they’re already selling for big dollars (in seven- and 10-year deals).

The “affiliate fees” that cable providers pay for the bundles are now up to $30 billion a year, or about $30 per subscriber per month. And programmers aren’t going to do anything that weakens that revenue stream.

So whether Apple ends up working with the cable providers like Comcast and strikes deals that use Apple TVs in lieu of a cable box, or whether Apple works with the cable programmers like Viacom and uses Apple TVs for a cable-free “over the top” service, the result would be the same: Consumers would have to pay a big monthly fee for a big package of TV channels, most of which they wouldn’t use.

In midday trading, the company’s shares fell 5 percent to $22.09 a share. Even so, that’s up from late last month, when the Chicago company traded as low as $15.24 a share, or roughly half of what some investors paid on day one.

The company is like a student in high school who still needs to push in order to get accepted into an Ivy League school. Even though it’s likely a shoo-in — and it’s already gone public — there’s no leeway for senioritis.

Most of the analysts’ evaluations were concerned about risks, such as the company’s short operating history, the prospects for growth now that it has gotten so large and intense competition coming from peers like LivingSocial, Amazon and Google among many others.

“While much execution lies ahead in order to meet expectations, the opportunity is large and Groupon has competitive advantages,” according to Barclays Capital, which had a neutral rating and a price target of $27.

J.P. Morgan also gave Groupon a neutral rating, but set a lower price target of $24 a share because there was still a lot to do despite its first-mover advantage.

“As subscriber growth slows, we project a major profitability ramp for Groupon over the next two years. However, we believe this ramp is largely anticipated and its magnitude leaves little room for error in execution and operations at current levels,” the analyst wrote.

Citigroup’s Mark Mahaney had the harshest words, saying he was “waiting for a better deal.”

He attributed his neutral stance and $24 price target to the lack of success in the company’s new segments, such as real-time offers, vacation packages and physical goods. “That, we believe, could take significant time to prove out,” Mahaney explained.

Nearly all the analysts were also concerned about the upcoming expiration date for a lock-up period. Expected in May 2012, it would allow some early investors and employees to dump the stock.

In other words, we could see a lot of people cashing in their vouchers right as the offer expires.

As reported in March around the time the merger was first proposed, T-Mobile, a division of Deutsche Telekom, stands to gain about $3 billion in break-up fees should the deal fail to close. AT&T would also give T-Mobile certain wireless spectrum that’s not needed for the rollout of its next-generation wireless network.

While AT&T has said it plans to fight the action in court, the sudden move by the Justice Department and the fact that the Federal Communications Commission — which would also have to sign off on the deal — has yet to weigh in on it, make it extremely unlikely that the merger will ever be consummated, says James Ratcliffe, a telecom analyst with Barclays Capital in a note to clients today. He points out that, historically, when they challenge mergers in court, the agencies tend to win about 60 percent of the time.

“We believe that the deal is by no means dead, as the DOJ has stated that the ‘door is open’ for AT&T to propose remedies, but the fact that the DOJ took this strong step this early in the process makes the probability of completion much lower,” he wrote. “We now view the probability of success at 35-40%, down from our previous 75% view.”

One of the primary arguments in the complaint (the original filing is embedded below via Scribd) focuses on government and enterprise customers. Where critics of the deal would charge that the only notable competitors to AT&T and T-Mobile are Sprint and Verizon Wireless, AT&T management would rebut that Leap and MetroPCS are also players. The DOJ complaint discounts that argument, especially with regard to business and government customers. Leap and MetroPCS are really regional players, the DOJ says, and so corporations and government agencies with many offices around the country can only realistically consider national carriers, the number of which would be reduced to three were the deal approved.

“T-Mobile makes its presence felt competing head to head with AT&T and other carriers for a number of accounts, winning business in some cases and often pushing prices lower when it does not,” the DOJ’s complaint reads. “The merger’s elimination of T-Mobile as an aggressive competitor would likely result in fewer choices and higher prices for enterprise and government customers.”

And while the DOJ has drawn its legal line in the sand, it’s not the only agency yet to be heard from. The Federal Communications Commission would also have to sign off on the deal for it to be approved. Its chairman, Julius Genachowski, issued a carefully worded statement that gives a strong hint that it will ultimately oppose the merger. “Competition is an essential component of the FCC’s statutory public interest analysis, and although our process is not complete, the record before this agency also raises serious concerns about the impact of the proposed transaction on competition,” Genachowski said.

In a conference call with reporters today, Harold Feld, the legal director of PublicKnowledge, a telecom advocacy group that has opposed the merger, speculated that the FCC will likely send the matter to an administrative law hearing, which he called “the kiss of death” for mergers. “By the time that procedure would be finished, T-Mobile would have taken its breakup fee and gone and built an entirely new network,” he said.

So on what legal basis might AT&T and T-Mobile fight the case? The DOJ is using some new market analysis techniques that haven’t been used in antitrust cases before, says Barclays’s Ratcliffe. “Traditionally, the DOJ has used regional impact analysis to study the impact of wireless mergers, and it does so here again,” he writes. “In addition, however, the DOJ is also viewing the market as being national, a comparatively new approach, which might be more open to challenge in the courts.”

AT&T CEO Randall Stephenson has promised to fight it, and continued to argue that the deal will bring real benefits to spectrum management nationwide, and create jobs. Deutsche Telekom said it will join the fight, too.

Justice-ATT-TMobile-Complaint

The maker of the popular FarmVille and CityVille games has picked Morgan Stanley to lead the offering, they said. Goldman Sachs Group Inc. is also a lead underwriter, and J.P. Morgan Chase & Co., Barclays Capital and Bank of America Merrill Lynch will play a role in the IPO, the people said.

Read the rest of this post on the original site »

Today’s the day we find out whether Cisco has successfully navigated the turbulence, and how bad the air pockets truly were. So far, the indications suggest that Cisco is starting to fly clear of the trouble. The consensus of analysts surveyed by Thomson Financial calls for Cisco to report per-share earnings of 35 cents on sales of $10.24 billion.

Barclays Capital analyst Jeff Kvaal wrote in a research note issued Monday that Cisco’s end markets look healthy. Telecom carriers and Internet service providers are spending, and you see that reflected in reports from Juniper, which show sales to service providers up 24 percent, and in AT&T’s optimistic capital spending outlook. Meanwhile, growth in enterprise spending is holding steady as companies improve their networks. And in the end, Cisco’s guidance for sales to grow 3 to 5 percent may prove a tad conservative, meaning those air pockets may not have been as entirely bad as originally thought.

But pressed to talk about some of the company’s non-search businesses, Chief Financial Officer Patrick Pichette did allow that YouTube’s revenues “more than doubled” last year.

That’s good to know! But also not a shock. Last quarter, when the company offered up a smattering of numbers to appease inquiring minds, it told us it had doubled the number of video views it was monetizing, to two billion a week.

So the real surprise would have been if YouTube revenues hadn’t doubled in the last year.

Meanwhile, trying to figure out the true size, and value, of YouTube remains a guessing game for the best-intentioned observers.

Citigroup’s Mark Mahaney, for instance, thinks YouTube’s gross revenue is on a $1 billion run rate, but figures that number could grow by as much as 50 percent this year. Barclays’ Doug Anmuth, though, offers up a slightly more modest estimate of $1 billion + for 2011.

Profits? Who knows.

One pretty safe guess: Google won’t be giving us real YouTube numbers we can chew on for quite some time.

And by the end of fiscal 2012, said Reitzes, that installed base will have reached over 200 million devices, driven by what he called the “FaceTime networking effect” that encompasses the better part of Apple’s consumer product line–something the company’s rivals may not be able to duplicate with video conferencing apps of their own.

“While Android and competitive devices either have or are working toward incorporating a similar feature, we believe this particular feature benefits from Apple’s vertically integrated model,” Reitzes said. “Experiences across disparate hardware platforms tend to vary–with Apple’s one of the most reliable in our trials. Also, this feature allows Apple to mine the millions of iTunes users who have Apple ID’s–and provide an attractive feature across devices that can be put into use immediately. We believe the ‘FaceTime networking effect’ could enhance a halo effect on Macs and iPads as the feature becomes available.”

Oh, and that FaceTime-compatible iPad that Reitzes says Apple will sell 10 million of? He expects it to be announced over the next month with a shipping date near the end of March or early April. And like most folks, he assumes it will include a thinner and lighter design, front and rear-facing cameras, a USB port, and an iPhone-like high resolution display.

[Image credit: FacePlant]

But only because those who speculated about the existence of a Verizon iPhone have been struck by a new monomania: Speculating about first-year Verizon iPhone sales numbers.

Indeed, the sales estimates are already rolling out, with the consensus so far hovering between nine million and 12 milion.

“Some think 10 million is possible in the calendar year,” Wedge Partners analyst Brian Blair told me. “And I think it’s a reasonable assumption–not just because of what we’ve seen on AT&T but because you have three years of pent-up demand from users who are loyal to the Verizon network because of its coverage and reliability.”

Gleacher & Co. analyst Brian Marshall agrees, though he’s betting on sales hitting the top end of the range I mentioned.

“The iPhone on Verizon will sell 12 million units in calendar 2011 assuming there’s a ramp-up similar to the one AT&T experienced in 2007-2008 (i.e., 5 percent penetration of the postpaid subscriber base within five quarters of launch),” he told me, adding that AT&T will see a material decline in its iPhone sales as a result.

Taking a more conservative view of the iPhone’s prospects on Verizon is Piper Jaffray analyst Gene Munster, who expects Verizon to activate roughly 25 million smartphones in calendar 2011, of which nine million will be iPhones.

Barclays Capital analyst James Ratcliffe too is betting on that nine-million figure, and of those he expects approximately 500,000 to one million to be purchased by AT&T switchers. Said Ratcliffe, “We don’t believe that the addition of a Verizon iPhone will be a seismic event in the wireless competitive environment, although we do expect it to result in a modest spike in AT&T churn, as customers who love their iPhones but have become unhappy with AT&T’s network take advantage of the alternative.”

PREVIOUSLY:

• Verizon iPhone to Debut With Unlimited Data Plan
• Apple CEO Likely to Appear at Verizon iPhone Event
• Verizon Event Set for Tuesday–iPhone Time

“We believe the iPhone should see continued solid growth into the December quarter with support from improved inventory in the US,” Barclay’s analyst Ben Reitzes said in a note to clients today. “Apple has now expanded distribution to Target (Target also sells the iPad) to join others including Apple stores, AT&T, Best Buy, Radio Shack and Wal-Mart. Perhaps more importantly, we believe availability is improving overseas, with the iPhone 4 set to ship for its first full quarter in China. International demand seems strong into calendar year-end.”

For the quarter ending in December, Reitzes figures Apple will sell 14.8 million iPhones, with sales ramping up after that, assuming the company moves to a multicarrier model in the states. Says Reitzes, “As we move into C1Q we continue to believe it is quite likely that we will see the iPhone introduced on Verizon in the US which should continue sales momentum. By CY-end 2011, we believe Apple will have more than 2 carriers in the US, which could help its market share vs. Android significantly.”

Though the clamor over a design issue that can diminish the iPhone 4’s signal strength might drag on the company’s shares, as it is today, Apple (AAPL) probably isn’t going to issue a product recall.

Said Piper Jaffray analyst Gene Munster, “We see [a recall] as a highly unlikely scenario given the issue is completely resolved with a case, which is a significantly less expensive solution for the company.”

Citigroup analyst Richard Gardner agreed.

“We consider the probability of a recall to be very low given our view that the issue in question is not serious enough to warrant a recall,” he said in a note to clients today. “While bridging two portions of the antenna with one’s hand on the lower-left corner of the phone does cause signal degradation, it does not typically result in dropped calls unless the signal from the cell tower is already weak. Excluding this issue, overall signal reception on iPhone 4 seems at least as good, if not slightly better, than reception on the iPhone 3GS.”

Over at Barclays Capital, Ben Reitzes offered a similar take. “As users, we have experienced some issues w/call drops; however, we have found drops go away after attaching a bumper accessory, which is quite useful anyway,” he wrote. “To date, we have not seen any overwhelming evidence of iPhone 4 units being returned.” And if the current spate of negative headlines should change that, well, it’s probably not going to have much of an effect on the company’s bottom line anyway.

Said Reitzes, “Worst case is some near-term sales are impacted and/or Apple revises its policy on ‘not giving away’ free bumpers, but usually demand just gets pushed to a slightly later date. Therefore, we do not believe these issues will impact Apple’s product momentum or the story materially at this time.”

To Reitzes, the iPhone 4 antenna issue is “overblown,” a sentiment shared by Munster as well.

“Ultimately we believe this PR black eye takes away some near-term upside potential to our iPhone estimates, but it does not change the long-term trajectory of the iPhone. While the issue has gained significant traction in the press, the reality is that we estimate this problem periodically affects 25 percent of iPhone 4 users given the fix is easy (a case for the iPhone), and 75 percent of customers choose to use a case anyway. While it has reached a boiling point, we believe the magnitude of this issue is being overblown.”

And seriously, an iPhone 4 recall? Steve Jobs would rather recall hiring John Sculley.

[Image credit: Rick Smolan]

• Tablets computers, a category that didn’t really exist until this spring, will be here to stay;
• Apple (AAPL) is going to own most of that market for years to come;
• This is yet more bad news for Microsoft (MSFT) and its Windows franchise, as well as PC manufacturers like Dell, in particular.

All points you’ve probably thought of before, if you’re the aforementioned Apple bull. But here are some numbers to chew on. Barclays predicts:

• That consumers will buy 15 million tablets this year and 28 million in 2011, and that Apple will hold onto a 75 percent market share next year;
• That the rise of tablets will indeed cut into PC sales, primarily in the netbook/notebook market–enough that Barclays is cutting its PC sales growth estimate for 2010 from 21 percent to 19 percent (still, as Steve Ballmer would say, 19 percent!).

Like graphics more than numbers? Okay. This one is pretty telling: Barclays’ estimate of how the PC market shakes out if you throw iPads into the mix. Steve Jobs and company aren’t knocking on Hewlett-Packard’s (HPQ) door anytime soon, but they are getting close to Dell’s (DELL). (Click to enlarge.)

• Tablets computers, a category that didn’t really exist until this spring, will be here to stay;
• Apple (AAPL) is going to own most of that market for years to come;
• This is yet more bad news for Microsoft (MSFT) and its Windows franchise, as well as PC manufacturers like Dell, in particular.

All points you’ve probably thought of before, if you’re the aforementioned Apple bull. But here are some numbers to chew on. Barclays predicts:

• That consumers will buy 15 million tablets this year and 28 million in 2011, and that Apple will hold onto a 75 percent market share next year;
• That the rise of tablets will indeed cut into PC sales, primarily in the netbook/notebook market–enough that Barclays is cutting its PC sales growth estimate for 2010 from 21 percent to 19 percent (still, as Steve Ballmer would say, 19 percent!).

Like graphics more than numbers? Okay. This one is pretty telling: Barclays’ estimate of how the PC market shakes out if you throw iPads into the mix. Steve Jobs and company aren’t knocking on Hewlett-Packard’s (HPQ) door anytime soon, but they are getting close to Dell’s (DELL). (Click to enlarge.)

Says Ratcliffe: “Channel checks by our communications equipment and semiconductor research partners give us greater confidence that Verizon will get an iPhone in early 2011, and we are now incorporating that belief into our models for AT&T and Verizon.”

Interestingly, Ratcliffe doesn’t see the end of AT&T’s iPhone-exclusivity deal with Apple (AAPL) heralding a subscriber exodus at the carrier. While he acknowledges that perception issues with AT&T’s network quality will inevitably drive some customers to flee to Verizon, he believes that many will stay put.

All told, the analyst expects approximately 500,000 to one million “switchers,” a relatively small portion of the nine million iPhones he says Verizon will activate in 2011 (click on charts below to enlarge).

“We don’t believe that the addition of a Verizon iPhone will be a seismic event in the wireless competitive environment, although we do expect it to result in a modest spike in AT&T churn, as customers who love their iPhones but have become unhappy with AT&T’s network take advantage of the alternative,” Ratcliffe writes.

“Overall, however, we believe that smartphone customers are relatively sticky, particularly given that (a) 70% of AT&T postpaid customers are on family plans (which would necessitate a group switch), (b) switching cost for customers currently in contract would be $375-525 per handset, (c) approximately 40% of handsets are covered under corporate discount arrangements, many of which may not have VZ equivalents, (d) for many, if not most iPhone customers, the service quality being delivered on the AT&T network is in reality comparable to what they’d receive on Verizon’s network, and (e) switching will likely result in accepting a bandwidth-capped data offering, since (we believe) that Verizon is likely to launch tiered bandwidth pricing prior to the launch of an iPhone.”

So, while the expiration of AT&T’s iPhone-exclusivity deal certainly won’t be good news for the carrier, it’s not going to be a disaster. Ratcliffe figures the carrier will still activate six million iPhones in 2011, which is quite a bit fewer than the 10 million he says it will activate this year, but a sizable number nonetheless.

Yesterday Armstrong sent CFO Artie Minson out to Barclays Capital to repeat the message. It got through. Here’s analyst Douglas Anmuth noting that ad sales will be underwhelming for a while, even though the Web ad business is bouncing back:

Management was quick to point out that AOL’s overall display pipeline for the back half remains soft. Management indicated that it has booked roughly 60% as much inventory for the back half as it had booked at the same time last year–and that was in a softer overall macro environment.

On the plus side, pricing for the ads AOL (AOL) does sell are improving, which it can attribute both to the overall recovery and AOL’s focus on selling high-end inventory while dumping its low-cost stuff. Still, Anmuth says, “We do not expect the uptick in CPMs to offset the removal of low quality ads and the sales force dislocation in the near term.”

So lower those expectations, okay?

But not too much!

AOL also suggests that its new search pact, which will replace the one with Google (GOOG) that expires in December, will be a big deal. According to Anmuth, “Management is approaching the renewal as a broad strategic partnership for the company that has many potential outcomes. AOL mentioned mapping and local could be part of the deal and we wouldn’t be surprised if a display ad partnership was also included.”

Barclays thinks Armstrong’s recent hire of ad tech executive Alex Gounares from Microsoft (MSFT) means the deal could end up tipping to Redmond. Stay tuned.

This is a large acquisition for SAP (SAP) and one that will give it quite a bit more fire power in its battles with nemesis Oracle (ORCL). As Forrester Research’s (FORR) Paul Hamerman told Bloomberg earlier today, “The deal makes sense because SAP is betting heavily on in-memory computing and mobile applications as the future of computing and Sybase brings to the table a capability for high-speed in-memory databases and a mobile application platform.”

Here’s the announcement:

SAP to Acquire Sybase

Strategic Move to Accelerate the Reach of SAP® Solutions across Mobile Platforms,

Help Companies Manage and Analyze Business Information and Processes on Any Device

WALLDORF, Germany and Dublin, California, USA — May 12, 2010 — SAP (NYSE: SAP) and Sybase, Inc., Dublin, California (USA) (NYSE: SY) today announced that SAP’s subsidiary, SAP America, Inc., has signed a definitive merger agreement to acquire Sybase, Inc., in a transaction that will bring the two information technology (IT) leaders together to enable companies to become better-run “unwired enterprises.” As a result of this transaction, customers will be able to better harness today’s explosion of data and deliver information and insight in real time to business consumers wherever they work so they can make faster, more informed decisions. Companies will benefit from greater productivity, speed and agility to help their businesses grow. Under the terms and conditions of the merger agreement, SAP America, Inc., will make an all cash tender offer for all of the outstanding shares of Sybase common stock at $65.00 per share, representing an enterprise value of approximately $5.8 billion.

The per share purchase price represents a 44% premium over the three-month average stock price of Sybase. The transaction will be funded from SAP’s cash on hand and a €2.75 billion loan facility arranged and underwritten by Barclays Capital and Deutsche Bank.

The Sybase board of directors has unanimously approved the transaction. The closing of the tender offer is conditioned on the tender of a majority of the outstanding shares of Sybase’s common stock on a fully diluted basis and clearance by the relevant antitrust authorities.

SAP and Sybase to Benefit from Synergies

Both SAP and Sybase will benefit from synergies across product lines and markets. SAP will accelerate the reach of its solutions across mobile platforms and drive forward the realization of its in-memory computing vision. This will drive higher user adoption of SAP software and unlock significant business value out of existing customer investments. In addition, Sybase’s innovative mobile platform can connect all applications and data (SAP and non-SAP) and enable them on mobile devices. SAP, Sybase and their customers will be able to tap into Sybase’s messaging network to reach 4 billion mobile subscribers through 850+ operator relationships worldwide and engage their consumers via alerts, transactions and promotions on their mobile devices.

For Sybase, SAP in-memory technology will provide the opportunity for dramatic performance improvements to its analytic processing capabilities. Sybase will also be able to bring its complex event processing and analytics expertise, which was built in the financial sector, to customers in other industries, markets and product areas in which SAP has a complementary, strong presence. Finally, Sybase’s core database business will be enhanced by SAP in-memory technology to deliver integrated transactional and analytical capabilities. At the same time, SAP reinforced its dedication to customer choice by stating that it will continue its commitment to supporting leading database vendors.

The synergies between the two companies will also expand opportunities for the SAP and Sybase ecosystems. Software and implementation partners can capture new opportunities by innovating on Sybase’s market-leading mobile platform, which will make it easier to create, deliver and securely manage mobile enterprise applications across major device types.

SAP and Sybase Stronger Together

“With this transaction, SAP will dramatically expand its addressable market by making available its market-leading solutions to hundreds of millions of mobile users, combining the world’s best business software with the world’s most powerful mobile infrastructure platform,” said Bill McDermott, co-CEO of SAP and member of the SAP Executive Board. “This is a game-changing transaction for SAP and Sybase customers, who will be better able to connect their employees with key functionality and information from anywhere and make it easier for companies to make faster, more informed business decisions in real time. With SAP’s customer-centric approach, we are resolute in our commitment to support Sybase customers to be best-run businesses.”

SAP said it will continue to support each organization’s product road map while enhancing products to help customers derive additional value from existing investments. It also stated that both companies’ development organizations would remain intact, with the opportunity to cross-collaborate to increase innovation for customers.

Headquartered in Dublin, California, Sybase delivers a range of solutions to ensure that customer information is securely managed and mobilized to the point of action, including enterprise and mobile databases, middleware, synchronization, encryption and device management software, and mobile messaging services.

“Mobile devices are becoming the preferred interaction point with business applications, whether the user is a factory supervisor, a retail manager or an entrepreneur in a developing nation,” said Jim Hagemann Snabe, co-CEO of SAP and member of the SAP Executive Board. “The combination of SAP and Sybase will give users the option of running their operations from leading mobile devices and will unleash the full power of mobility, including messaging interoperability, content delivery and mobile commerce services, across all companies and roles and in any location. In addition, innovation around Sybase’s established database business will pave the way for ‘real’ real-time analytics and finally remove the decade-old barrier between business applications and business intelligence.”

Sybase to Operate Stand-Alone

The two companies announced that Sybase will operate as a standalone unit under the name “Sybase, an SAP Company.” Sybase’s management team will continue to run the business. The SAP Executive Board plans to propose to the Supervisory Board to appoint the Chairman and CEO of Sybase to SAP’s Executive Board.

“This transaction better positions SAP and Sybase to bring remarkable benefits of mobility and real-time information to our customers’ existing technology investments,” said Vishal Sikka, Chief Technology Officer and member of the SAP executive board in charge of Technology and Innovation. “SAP’s in-memory computing technology is already revolutionizing business analytics and will bring a paradigm shift to enterprise data management for all applications. The in-memory team within SAP will continue its current mission to innovate in-memory technology and these innovations will enable both SAP and Sybase to bring unprecedented value to their customers.”

“This combination is a transformative event in the software industry,” said John Chen, CEO of Sybase, Inc. “SAP’s in-memory technology in combination with Sybase’s database technology will revolutionize how transactional and analytic applications are built, benefiting all businesses. Further, by combining the market leader in enterprise applications with the market leader in enterprise mobility, companies around the world will be able to run their business from many devices. This will drive a new wave of enterprise productivity. The combined SAP/Sybase will be able to provide a software offering that enables companies to transform their businesses in an increasingly data-, consumer- and mobile-centric world.”

Transaction Expected to Be Accretive to SAP’s Earnings per Share on a non-IFRS Basis in 2010 and Beyond

The transaction is expected to close during the third quarter of 2010 and will be immediately accretive to SAP’s earnings per share on a non-IFRS adjusted basis. SAP expects the combination to deliver synergies through both revenue enhancement and the realization of cost efficiencies. Additional details regarding specific product, go-to-market and other integration details will be provided after the transaction is complete.

Tender Offer Details and Disclosure Information

SAP America’s wholly owned subsidiary, Sheffield Acquisition Corp.will promptly commence a tender offer under US securities law for all outstanding shares of Sybase common stock.

The completion of the tender offer and acceptance of Sybase’s shares is conditioned on the tender of a majority of the outstanding shares of Sybase’s common stock on a fully diluted basis and the satisfaction of regulatory and other customary conditions. Approval of the transaction by SAP’s stockholders is not required and the transaction is not subject to a financing condition.

Financial Analyst and Media Conference Call

SAP and Sybase senior management will host two conference calls for financial analysts and media to discuss the transaction:

On Wednesday, May 12th, at 11:30 pm CET / 5:30 pm Eastern (Dial in numbers: +49 6958 999 0797 (Germany), +44 20 8515 2302 (UK), +1 480 629-9692 (US), Conference ID: 4301600; Replay numbers: +44 20 7154 2833 (UK), +1 303 590-3030 (US), Access code: 4301600)

On Thursday, May 13th at 8:00 am CET / 2:00 am Eastern (Dial in numbers: +49 69 58 999 0797 (Germany), +44 20 8515 2302 (UK), +1 480 629-9692 (US), Conference ID: 4301586; Replay numbers: +44 20 7154 2833 (UK), +1 303 590-3030 (US), Access code: 4301586)

The calls will be webcast at www.sap.com/investor.

Perhaps it’s time to rethink that one, argues Barclays Capital’s Douglas Anmuth. The analyst has downgraded Netflix (NFLX) for primarily technical reasons, but along the way, he makes a good point about the company’s well-received app for Apple’s (AAPL) new gadget: It’s pretty awesome, but it may not generate many subscriptions for the movie rental service.

Why? Because Anmuth thinks just about everyone who has an iPad already has a Netflix subscription.

We view the new iPad app positively as it should help increase the value of a Netflix subscription and result in more loyalty and less churn, but we do not view it as a major driver of subscriber growth, especially given that many iPad purchasers are likely already Netflix subscribers. The large install base of the iPhone (48 million globally) could be more material with the pending app, but we believe consumers would generally prefer to view content on a bigger screen.

Time for some crowd-sourced opinion polling: Anyone out there who has an iPad and the Netflix app? Anyone who has bought a subscription because of the app? Anyone out there waiting to subscribe until the app comes to the iPhone?