Sales grew by 53 percent over the year-ago period to $22.5 million, which beat the average estimate of analysts by more than $1.5 million, while Q4 billings of $36 million were up 40 percent. Plus, the IPO raised more than $180 million in cash.

And while that’s all good, on an old-school GAAP basis, Jive finished the quarter with a $12.7 million loss that was roughly twice the size of the loss in the year-ago period. While that may seem at first to be kind of a bad thing, it’s not. Since Jive sells subscriptions, it defers a lot of its revenue to later periods, so the revenue it does book doesn’t readily outweigh the costs it incurs to get the sales growth done. This is common with SAAS companies like Salesforce.com and NetSuite, who also tend to run net losses on a GAAP basis, but focus on their non-GAAP results, which are more indicative of the state of the business.

I talked briefly with CEO Tony Zingale about this and other things, after he finished up his conference call with analysts. A summary of our chat is below, and below that is an interesting infographic that Jive’s PR team included with the earnings release. I thought it was a nice touch, so I’m sharing it here.

AllThingsD: Tony, for those who don’t know, walk us through the key metric in your results that, in your mind, made this a good quarter for you.

Zingale: Growth. Growth in revenue. It’s further amplified in a new market where growth is the paramount metric, and of course it’s measured against a path to profitability. And we communicated that in our guidance to the analysts. But it’s all about growth. If you can’t capture market share as measured by deals with large enterprises and paying customers, then the profitability metric comes into greater play. Plus, in SAAS software companies, profitability always lags because of the ratable revenue model.

How are you finding life as the CEO of a public company? I know it’s not new for you, specifically, but it’s new with this company.

I think it is a testament to social becoming viable and real in the enterprise. You’ve been following the story for more than a year. You can’t go public without recurring, substantial growth, and the kind of customers and the kind of growth as measured by the repeatability of the model. All at the same time, you have to continue to innovate, fend off the competition and deliver that value. It feels good to have cleared the bar of going public, but otherwise, it’s back to work.

Let’s talk about the competition. Are you seeing certain people out of deals where they show up against you?

We do exceptionally well in a head-to-head competition, especially when we see a request for proposal. We’re seeing more of those as we go into 2012. It lends credibility to the social business space, as corporations are thinking of social software as a line item in their budgets. The competitive landscape hasn’t changed. It continues to be the large enterprise software players like Microsoft and IBM. And certainly Salesforce.com shows up when we’re competing for business in the sales department, and a little bit in the marketing department. Salesforce is very well-entrenched in these situations. But we coexist with them all the time. But the landscape hasn’t changed much. It’s competitive in the early part of the process. But when it comes to competing inside and outside the enterprise — the flexibility of our delivery model and the strength of our reference customers — the competitors tend to fall away.

He’d also been heavily recruited. Sources familiar with the situation told me that Swainson had been in line for a very senior and nearly identical job at Hewlett-Packard. Swainson didn’t return my call seeking comment, and spokesmen for HP and Dell declined to comment, as well.

Dell is launching the Software Group, it said in a statement, to build out its muscle on the software side as a complement to its overall mission of selling IT services.

And there’s probably no one better to do it than Swainson. Since 2009 he’s been an adviser at private equity firm Silver Lake Partners. But from 2004 to 2009 he ran CA with one single goal in mind: Rebuilding its reputation following an accounting scandal that ended when its prior CEO, Sanjay Kumar, was sentenced to 12 years in prison. The company paid $225 million to settle federal charges brought by the Securities and Exchange Commission and the Department of Justice.

But before CA, Swainson had spent 26 years at IBM. Among the things he did at Big Blue was spend seven years as general manager of its Application Integration Middleware division, which was a business he created. It was during those years that IBM launched its WebSphere family of products.

So that leaves just one question: Who’s going to run the HP software division that it had wanted Swainson to run?

Shares are down more than $4, or about 13 percent. The freakout appears to be coming from gross margins that shrank to 51 percent from almost 59 percent in the prior quarter, and despite the fact that sales more than doubled sequentially to $84 million from $31 million before.

CEO David Flynn called me up a little while ago to talk about the results, and he reminded me that Fusion launched its new IO Drive 2. It’s a transition to a new product line that’s proving tricky. New products built on new technologies are always a little more costly to build up front, and that’s compounded by the fact that early adopters, when they buy the new stuff, take the lower-end version and not the more expensive and more profitable one.

Also, enterprise customers who buy the new stuff are always conservative and take longer to decide whether they want to buy it or not, he says. Even so, the company has sold 10,000 of the new drives.

But? There’s a new customer of record: Salesforce.com is now a Fusion-io customer, and has joined the likes of Apple and Facebook, which is using the flash-based chips in the servers running in its data centers around the world.

And Salesforce isn’t buying it directly from Fusion, but rather through one its OEM partners, which include Hewlett-Packard, IBM and Dell, though Flynn wouldn’t tell me which one it is.

Salesforce is one of six customers who bought more than a million dollars worth of Fusion’s stuff this quarter and of those, four were repeat customers, Flynn told me.

The Salesforce win is also important, Flynn says, because some have wondered whether Fusion’s technology, while popular with high-end enterprises like banks and Facebook, would make sense for applications that tend to be used in mid-tier businesses, which Salesforce’s mainline CRM application often is. The lower end of the enterprise software market is moving toward cloud-based software, which is often referred to as Software as a Service, or SAAS. “By helping those companies, we are indirectly driving business in the mid-range of the market. Apple and Facebook are in the SAAS business too, it’s just that their customers are consumers.”

One interesting fact that Flynn shared with me: His first job out of college was working for Oracle. His boss at the time? One-time Oracle exec and now Salesforce CEO Marc Benioff. A small world it is, indeed.

Deutsche Bank analyst Chris Whitmore expects some difficulties for Big Blue stemming mainly from the company’s exposure to the troubled economies of the euro zone and related currency weaknesses there. He expects the company to report sales of $29.8 billion and per-share earnings of $4.62, with his sales forecast slightly more optimistic than that of the consensus of Wall Street analysts.

Even so, he expects the strength of the U.S. dollar relative to the euro in recent months will create a headwind effect worth about 2 percentage points compared to IBM’s prior forecast in October. “Although the stronger dollar is likely to impact reported revenue, IBM remains one of the most defensive names in our universe due to its high exposure to recurring profit streams, past backlog growth and wide geographic and business diversification,” he wrote in a note to clients yesterday.

Hardware sales should be in line with forecasts as IBM has continued to gain market share away from Hewlett-Packard and Oracle. Services should continue to be a sign of IBM’s strength as its backlog of prior contracts should continue to deliver a stable stream of revenue.

One problem may come from service bookings. Whitmore thinks the consensus estimates on this closely watched number are, at $21.5 billion, a little high and thus could disappoint. IBM announced only five deals in the fourth quarter compared to seven in the same quarter of 2010. And though information about the size of the deals was limited generally, two of them combined to amount to about $740 million. “IBM’s services bookings figure is always a wildcard and the lack of many announced deals clouds visibility,” Whitmore wrote. He rates IBM a buy with a price target of $210.

The earnings report will also be the first with Ginni Rometty as IBM’s new CEO. Having already had a busy first few days on the job, it will be interesting to see if she uses the occasion of an earnings conference call to announce anything new, though that’s unlikely.

What is Big Data?
Big Data technologies like Apache Hadoop provide a framework for large-scale, distributed data storage and processing across clusters of hundreds or even thousands of networked computers. The overall goal is to provide a scalable solution for vast quantities of data (terabytes/petabytes/exabytes) while maintaining reasonable processing times. These systems are incredibly effective for storing and analyzing large volumes of structured as well as unstructured or semi-structured data such as text, web or application logs, email, web pages, documents, and images.

Big Data in the Enterprise
Companies are capturing and digitizing more information than ever before. According to IDC, the world produced one zettabyte (1,000,000,000,000 gigabytes) of data in 2010. Fueling this data explosion are over five billion mobile phones, 30 billion pieces of content shared on Facebook per month, 20 billion Internet searches per month, and millions of networked sensors connected to mobile phones, energy meters, automobiles, shipping containers, retail packaging and more. Big Data is a platform for transforming all of this data into actionable items for business decision making.

The barriers to entry for Big Data analytics are rapidly shrinking. Big Data cloud services like Amazon Elastic MapReduce and Microsoft’s Hadoop distribution for Windows Azure allow companies to spin up Big Data projects without upfront infrastructure costs and allow them to respond quickly to scale-out requirements. Commercial vendor support from companies like Cloudera can speed development and deliver more value from Big Data projects. Bundled server options such as Oracle’s Big Data Appliance offer fast setup and scale-out solutions. Finally, modular data center designs are emerging as a way to efficiently manage hardware and scale-out rapidly and cost-effectively.

Companies likely to get the most out of Big Data analytics include:

• Supply chain, logistics, and manufacturing — With RFID sensors, handheld scanners, and on-board GPS vehicle and shipment tracking, logistics and manufacturing operations produce vast quantities of information offering significant insight into route optimization, cost savings and operational efficiency
• Online services and web analytics — Internet companies invented Big Data specifically to handle processing information at Internet scale. Implementation of these analytical platforms is now viable for smaller online services companies to provide an edge over competitors for advertising, customer intelligence, capacity planning and more. Companies who don’t offer online services but do have an ecommerce or other online presence will benefit greatly from understanding customer behavior and buying patterns via clickstream, cohort analysis and other advanced analytics.
• Financial services — Financial markets generate immense quantities of stock market and banking transaction data that can help companies maximize trading opportunities or identify potentially fraudulent charges, among various other uses. New regulations also require detailed financial records to be maintained for longer periods.
• Energy and utilities — Smart instrumentation such as “smart grids” and electronic sensors attached to machinery, oil pipelines and equipment generate streams of incoming data that must be stored and analyzed quickly to uncover and fix potential problems before they result in costly or even disastrous failures.
• Media and telecommunications — Streaming media, smartphones, tablets, browsing behavior and text messages are captured at ever-increasing rates all over the world, representing a potential treasure trove of knowledge about user behavior and tastes.
• Health care and life sciences — Electronic medical records systems are some of the most data-intensive systems in the world and making sense of all this data to provide patient treatment options and analyze data for clinical studies can have a dramatic effect for both individual patients and public health management and policy.
• Retail and consumer products — Retailers can analyze vast quantities of sales transaction data to unearth patterns in user behavior and monitor brand awareness and sentiment with social networking data.

Data Warehouse Integration
To apply this new technology effectively, it is important to understand its role and when and how to integrate Big Data with the other components of the data warehouse environment. In a vast majority of cases, Big Data does not replace the data warehouse. Hadoop is built for speed and flexibility across huge sets of often unstructured data, but is best used for fairly simple workloads, such as sorting, aggregating, converting, and filtering. Hadoop is also not intended to manage schema structure, referential integrity or security. Database management systems are therefore still a vital part of the overall solution architecture. So how will Big Data Analytics be incorporated with existing BI/DW investments?

Hadoop provides an adaptable and robust solution for storing large data volumes and aggregating and applying business rules for on-the-fly analysis that crosses boundaries of traditional ETL and ad-hoc analysis. It is also common for the results of Big Data processing jobs to be automated and loaded into the data warehouse for further transformation, integration and analysis. This allows Big Data to be integrated with data from other sources and exposed to users via BI tools, dashboards and reports. Several options are available for extracting data from Hadoop into the data warehouse. IBM, Informatica, Microsoft, Oracle and SAP have released or announced tools to interface between Hadoop and relational database management systems.

User-Friendly Tools for Big Data
Tools like Apache Pig and Apache Hive provide SQL-like frameworks for advanced data analysts to run queries directly against data stored in Hadoop. This is an effective way to do targeted, one-time analysis, perform exploratory data mining, or develop queries that may later be automated and loaded into a data warehouse. However, these tools require technical expertise and do not cater to end users.

Luckily, there are some exciting end-user tools coming in 2012. Tableau has support for drag and drop Hadoop reporting currently in beta and Microsoft recently announced the Hive ODBC driver and the Hive add-in for Excel which will allow end-user access to data stored in Hadoop through Excel, PowerPivot and Analysis Services. Tools that enable end users to slice, dice and visualize data in Hadoop will become increasingly important components of a company’s Big Data analytics arsenal over the coming years.

Big Data adoption will continue to be driven by large and/or rapidly growing data being captured by automated and digitized business processes. Successful adoption of this technology requires turning this raw information into usable knowledge throughout the enterprise. To accomplish this, companies will need to intelligently incorporate Big Data into their existing information management systems and take advantage of the developing ecosystem of integration and analysis tools. As we move into the age of Big Data, companies that are able to put this technology to work for them are likely to find significant revenue generating and cost savings opportunities that will differentiate them from their competitors and drive success well into the next decade.

Harlan Smith is a Manager in the Business Intelligence and Performance Management practice at Hitachi Consulting, specializing in business intelligence engineering, architecture and project/program management. Harlan is a graduate of the University of Puget Sound in Tacoma, WA, and currently lives in Seattle where he has been a consultant since 2005. Follow him @smithharlan on Twitter.

“Sources familiar with the matter” tell Reuters that Brocade has received first-round bids from “a handful” of interested buyers.

Who might those parties be? Now that Dell has acquired Force10 Networks and Hewlett-Packard has snapped up 3Com, the list of possible suitors is a bit shorter than it used to be.

So who’s left? IBM remains a candidate and Oracle is always a possibility, regardless of what its CEO has said in the past. And beyond that? Private-equity firms, most likely.

Brocade shares are trading up more than 6 percent on buyout speculation.

The Lotus Notes creator and Groove founder has lain extremely low since departing the software giant at the end of 2010. However, word surfaced on Wednesday that Ozzie’s new project is a venture called Cocomo that is actively hiring, preferably in the Seattle or Boston areas.

According to the report in the Boston Globe, Ozzie is joined by two ex-Microsoft employees, Ransom Richardson and Matt Pope. Ozzie confirmed the bootstrapped venture but offered little detail on what the start-up will focus on. The job posting for a user experience designer seeks someone with experience in both mobile and social who is proficient with iOS and Android apps.

“A new day has dawned as it relates to how we might interact with one another, and a handful of us are just starting work on a new communications product for this new world,” the company said in the posting. “We’ve got huge goals, pragmatic plans, and a sense of urgency.”

In a brief online chat this morning, Ozzie told AllThingsD he wasn’t ready to say much more. However, he did share one more name involved with Cocomo: Boston start-up veteran Ari Goldberg. Goldberg also worked at Microsoft in Boston, but left in November, according to a LinkedIn profile.

Cocomo does have the barest of Web sites, consisting for now of a logo and a link to its hiring email address.

At Microsoft, Ozzie inherited the Chief Software Architect mantle that had belonged to Bill Gates. During his time there he helped re-direct Microsoft from focusing on software that ran on a server or desktop toward Internet-delivered services. While his vision can be seen in products like Office 365, Windows Azure and Windows Live, there was considerable tension at times between Ozzie and Microsoft’s product teams.

Ozzie appeared on stage with then-boss Steve Ballmer at our D8 conference in June 2010. One particularly notable part of this interview is where the two are discussing Google’s strategy of promoting both Android and Chrome OS. While Ballmer dismisses the dual-pronged strategy, Ozzie characterizes Android as a bet for the past and present and Chrome OS as a longer-term bet based on where things are headed.

And it was just a few months after upstaging his boss that Ozzie parted ways with Microsoft.

Update: One more tidbit: It appears that Ozzie and team spent $33,000 to acquire the Cocomo.com Web address, according to Domain Name Wire.

The new forecast calls for companies and governments to spend a combined $3.8 trillion on information technology, which would amount to growth of 3.7 percent from 2011. The previous forecast had called for growth of 4.6 percent.

For perspective, the difference on a dollar basis is about $100 billion, which is certainly real money, but when you consider the various puts and takes affecting the projected spend, it makes a certain amount of sense.

Gartner says that all four of the major technology sectors it tracks — computing hardware, enterprise software, IT services, and telecom equipment and services — will see their growth rates slow this year.

You can probably guess why: The uncertain global economy, the euro zone sovereign debt crisis and the disruptions on the hardware supply chain from last year’s flooding in Thailand on hard-drive production have all teamed up to perform a triple whammy on the tech sector. The Thailand problem will probably last until well into 2013, Gartner’s Richard Gordon says in a statement, echoing what Seagate CEO Steve Luczo told AllThingsD in an interview in November.

Telecom equipment spending will probably suffer the least, Gartner says. Sales in that sector will grow by nearly 7 percent to $475 billion, followed by the enterprise software market, which will grow by 6.4 percent to $285 billion. The chart at the right, which I screengrabbed from Gartner’s handout, breaks down the revised outlook by each sector versus what the previous growth outlook had been.

Gartner also trimmed its average annual growth projection for IT spending through 2015. It now expects spending to grow by about 5 percent on average, down only slightly from 5.4 percent, but in the wider scope of a few trillion dollars, a fractional change still amounts to hundreds of billions of dollars.

Today, Big Blue closed its first acquisition of the Rometty era, announcing a deal to buy privately held Green Hat, a company that specializes in software for conducting quality tests on software applications for the cloud. It’s small enough that IBM didn’t disclose financial terms. Green Hat dates to 1996 and is based in London and Wilmington, Del. Its main stock in trade is to simplify the capital- and labor-intensive job of testing software applications by moving the entire process to the cloud. Once the deal closes, Green Hat will become part of IBM’s Rational Software business unit.

And if acquisitions weren’t enough, there have been some promotions too. As first reported by Bloomberg News, which obtained an internal memo, Rometty named Bruno Di Leo as senior vice president of sales and distribution and Bridget Van Kralingen as new senior vice president of IBM Global Business Services, IBM’s consulting arm. Van Kralingen is replacing Frank Kern, who is retiring after 35 years at IBM.

Di Leo is a native of Peru, and joined IBM in 1975. His last job was running the high-profile growth markets unit, which specializes in business in the BRIC countries — Brazil, Russia, India and China. James Bramante was named as his replacement and will be based in Shanghai. The job is an important one as IBM has set a goal of boosting its revenue in these markets to 30 percent of sales by 2015.

And while it was something of a publicity stunt to put a sophisticated and specialized IBM computer in people’s living rooms, the fact remains that Watson is, well, a pretty sophisticated and specialized computer.

Since schooling humanity at “Jeopardy” — which was the subject of a book — Watson went on to get a real job working for the health insurance company Wellpoint.

Now IBM has decided it is ready to tackle something a little more involved. Watson is about to go to medical school, and will even study a specialty: Oncology. Sometime this year, after studying and even taking exams to prove what it has learned, Watson will be assigned to assist human physicians in the treatment of breast, lung and colon cancer.

If this seems like kind of a big deal, it is. Watson won’t be the first computer to serve as a reference tool, helping doctors do their jobs. But then there has never been a computer quite like Watson, which can learn so readily from natural language — and play TV game shows and win.

Last week, I talked with Manoj Saxena, general manager of the Watson program at IBM, to talk about what Watson will — and won’t — be doing in helping doctors treat humans with cancer, and what that might mean for the future of medicine.

My first question was about what Watson has been doing since its big win:

AllThingsD: So, Manoj, last I knew, Watson had been working for Wellpoint, which is a large health insurer. What exactly has it been doing?

Saxena: Let me bring you up to speed. In August, we announced the first commercial relationship of Watson with Wellpoint, one of the nation’s largest health insurers. They have 35 million customers in 14 different states. One out of nine Americans are covered by them. The first area was around utilization or approval. Let’s say you or I call up a clinic or hospital saying we have flu-like symptoms. Where Watson would come in is on the approval process, saying we’re covered. Then Watson looks at the history that the hospital has in its records. It might say that it’s early December, and I come in at this time every year saying the same thing; and the last two times it was a ragweed allergy, not the flu. And the medical journals say there’s a connection between ragweed and fever that looks like the flu. And by the way, the newspaper says there was an outbreak of ragweed in Central Texas. And then, in addition to treating for flu, also look for allergies. So Watson is considering the medical record; the patient history that the insurance company has; and third, the medical journal and news information about what may be causing a certain thing. So that’s what it’s doing with Wellpoint so far.

How then do you make the pivot to working with cancer?

We’ve installed another adviser — these solutions are called Watson Advisers. This one is called Watson Oncology Adviser, and this is a big one. As you may remember, medical information is doubling every five years. Doctors tell us that they are spending only five hours per month going through new information in medical literature. On one hand, you have all this medical information coming out. We’ve decided to focus first on breast, lung and colon cancers as the three to apply Watson to. And Cedars-Sinai has partnered with Wellpoint to help come up with the right cancer solutions. And the point is to build the expertise within Watson to help treat cancer.

So Watson won’t be directly involved with the treatment, but rather to build up its own knowledge base?

Watson doesn’t make the decisions. It’s a physician’s assistant. But before it becomes that, it has a lot to learn. Out of the box, Watson has the knowledge of a first-year medical resident. That is where it’s at today. With Cedars-Sinai and Wellpoint, we’re going to teach it all about cancer during the next six months. We’re going to show it actual cases that were solved in the past. And over time, we’ll tweak and teach it, using things we already know.

Is there a human analog to this process?

A good human analog is how we learn. As children, our teachers and parents sit with us and ask questions to understand how well we learned from what we read. And then, later, we learn by doing. This will address the first two phases. Watson will read on its own, and then oncologists are going to ask questions of Watson to understand how well he has learned and then understood. And then once we feel comfortable that it has learned enough, then we will let it begin working as a physician’s assistant, and then it will go from there.

Since, in the end, there are humans being treated, do you have to get any kind of regulatory approval to do this?

No. It’s very similar to how doctors refer to medical journals. Doctors might turn to Google or something like that to look up info from their medical journals. That doesn’t require any approvals. Someone else asked me what happens if Watson suggests a particular treatment, the doctor accepts it, and the patient dies. Or what happens when Watson suggests something and the doctor doesn’t take his advice. Our view is that it’s the same as looking up textbooks and information. The physician is the one who makes the final decision.

And that will always be the case?

That will always be the case, yes. We are far, far away from computers doing medical treatments. I don’t even see it in the forseeable future.

How do you actually go about feeding information to Watson? How does it learn?

It’s a good question. There are four different types of information that’s fed into Watson. At the base of the pyramid, it’s general information like Wikipedia and Google and general information like that. And a lot of that is general knowledge; and a lot of that is already in place, because we needed that to play Jeopardy! Then the second layer is the medical textbooks and medical journals and vocabularies, and those are fed in as natural-language information. It can be any scanned information or text information because Watson understands natural language. So that information is the second part. It can process text and tables, but it can’t process pictures and videos, but we’re working on that. And then there’s the actual test cases, the information on people with 30 years of cancer treatment history. We feed that into what are called “answer keys.” The fourth layer are new domain-specific information models that are specific protocols and procedures that the health insurance companies will want to feed into Watson.

Where do you draw the line? There is an accepted mainstream body of knowledge and accepted treatments for different cancers, and then there are newer things that may be controversial for some reason.

The way we approach it is in two parts. One is the body of knowledge that is already known. But it does not get applied and in context, and often doctors don’t have access to it in context. There are things like cancer treatment guidelines and well-understood things about radiation and effects on different cancers. Call them the known treatment pathways. The second are the emerging treatment pathways, particularly in the area of genomics. That is the one that can get added on. It’s the one our partners are looking at. In about a decade, most cancer treatments are going to shift to genomics-based treatments, rather than chemotherapy-based treatments. There’s a deluge of information about converting the knowledge about DNA into biological knowledge, and then converting that into treatment knowledge. That is the second part of what we’ll be doing.

Do you have other diseases that you think Watson can help treat in the future?

Yes. Diabetes and cardiology, heart problems are next on the horizon. We’ll also be applying Watson in financial services.

Of the companies in Marshall’s coverage universe, only Apple, IBM and Dell had positive returns and saw their shares rise by an average of 20 percent. By contrast, the three biggest decliners were Hewlett-Packard, Juniper and NetApp. (For the record, the others Marshall covers are Brocade, EMC, VMware, Cisco Systems and F5 Networks.)

One thing the advancers had that the decliners didn’t? Conservative guidance. “The importance of conservative guidance practices was underscored as investors had little tolerance for companies that could not execute on stated growth targets,” Marshall writes. HP, NetApp and Juniper all set out aggressive earnings goals that proved too optimistic. Per-share earnings estimates for the coming year among those three were revised downward by an average of 15 percent.

By comparison, Apple, IBM and Dell set lower barriers and ended up having positive earnings surprises, and have moved up their forward earnings estimates by about 17 percent. “Setting conservative targets will again remain critical in 2012,” Marshall writes.

So what’s going to set the tone for tech stocks in 2012? A lot of the same things that made 2011 so difficult. Sovereign debt concerns in Europe, coupled with governments around the world implementing austerity measures to help get their budgets back on track, will hammer IT spending at companies that sell to governments.

That doesn’t mean there won’t be positive trends to look for. Certain megatrends in computing will sail on, despite the rough economic waters. “Cloud computing and mobile internet remain firmly in place and can drive outperformance for companies positively exposed,” Marshall says in his note.

The growth in mobile clients like smartphones and tablets will spur ever more rich and complex computing environments in the cloud, meaning more and better data centers packing more computing power into the same or smaller footprint. Marshall mentions microservers, which brings to mind HP’s Project Moonshot, which aims to create dense racks of small servers, as an important trend to watch. “We think many data centers could look to microserver solutions that deliver thousands of cores in a rack and order of magnitude improvements in performance/power,” writes Marshall. These microservers, he says, could be powered by both x86 chips from Intel or Advanced Micro Devices, or by ARM-based chips.

And since there will be more servers — all of them virtualized, allowing one single server to act like dozens or even hundreds of servers, plus increased demands for storage and video — they will require higher-performing connections. That’s going to push companies building data centers to adopt Ethernet fabrics. On top of that, more companies build servers that support faster 10 gigabit Ethernet. Marshall argues that these Ethernet fabrics could constitute as much as one-third of the $6 billion market for data center switching within three years.

Then there’s big data. With more information than they know what to do with scattered all over the place, companies are struggling to make sense of it all. Large enterprises will be investing in data integration tools to get a unified view of all their information. “We believe organizations will continue investing in data integration tools which can help link historical and real-time data, and enable more valuable business intelligence and predictive analytics,” Marshall writes, adding that the market is worth about $2 billion today, but is in the “early innings of a growth cycle.”

(Image courtesy of chainsawpanda)

The New York Times published something of an exit interview with Palmisano over the weekend. It read a bit like a victory lap, and that’s not undeserved. The record books will show that IBM shares during the Palmisano era (2003-2011) rose by 125 percent; sales grew from $81 billion in 2002 to an expected $107 billion; and annual profits on a per-share basis went from $3.07 to a consensus forecast of $13.38.

But it got me to thinking about one of the highlights of the Palmisano era; one that generated a great deal of attention at the time: IBM’s decision to sell its personal computer division to Lenovo, the Chinese PC maker. It was a relatively small deal, worth less than $2 billion at the time, but it was a controversial move. Despite the fact that IBM wasn’t making much money on the business, IBM PCs, especially its ThinkPad line of notebooks, were generally considered to be pretty good.

Nearly seven years later, it’s worth noting that Lenovo is now the world’s second-largest PC vendor, behind Hewlett-Packard, having vaulted past Dell earlier this year, according to the market research firm IDC. It’s also worth noting that Lenovo is in fifth place in the U.S., behind HP, Dell, Apple and Toshiba, in that order.

IBM initially owned 15 percent of Lenovo and maintained a stake in that company until February of this year, when it sold its remaining 4.3 percent shares at a profit of more than a quarter-billion dollars.

Lenovo’s biggest shareholder is Legend Holdings, of which 36 percent is owned by the Chinese Academy of Sciences, a.k.a. CAS Holdings, a state-controlled entity. The state has pared back its stake, though: When the IBM-Lenovo deal was announced in 2005, Lenovo was 57 percent state-owned.

There was a lot of natural controversy, and even national security concerns in 2005, about selling so red-blooded an American product as the IBM PC to China. But there was also a solid business case to consider. The PC business was a drag on earnings because of downward price pressure exerted by Dell and all the others, and it wasn’t even leading the market, as was the case with Hewlett-Packard, which engaged in some very public contemplation about spinning off its own PC division.

But there was also a potential strategic benefit, which Michael Useem, a professor a the University of Pennsylvania’s Wharton School of Management, pointed out at the time: Making friends with China.

By selling an underperforming asset to a buyer willing to take it and run with it, IBM got solid access to the exploding Chinese market. In paraphrased remarks to the Times, Palmisano concedes the point:

Palmisano says he deflected overtures from Dell and private equity firms, preferring the sale to a company in China for strategic reasons: the Chinese government wants its corporations to expand globally, and by aiding that national goal, IBM enhanced its stature in the lucrative Chinese market, where the government still steers business.

So how has that worked out? It’s a little hard to tell from reading Big Blue’s Byzantine financial statements. In fiscal 2005, the year the deal closed, IBM reported $18.6 billion, or about 20 percent of revenue, came from the Asia-Pacific region, including China.

And though it declined to provide specific dollar amounts, it said that year that sales in China had dropped by 19 percent, but after after stripping out the PC division, would have grown by 8 percent.

For the first nine months of fiscal 2011, IBM reported that the Asia-Pacific region accounted for exactly the same dollar figure — $18.6 billion — amounting to 24 percent of its overall sales of $77.4 billion, and there’s still a quarter to go. That would put Asia on track to account for a little less than a quarter of IBM’s revenue.

In its earnings statement, IBM also makes a point of calling attention to what it calls “growth markets,” which are generally the BRIC countries — Brazil, Russia, India and China. These markets combined for 23 percent of sales in IBM’s most recent quarter.

This is about as close to understanding the size of IBM’s business in China as we’re going to get. On balance, it looks to have been a positive move, especially when you consider that if IBM had kept its PC division, it would have likely only gotten smaller and become more of a profit drag on a company that’s increasingly focused on high-margin businesses like services and consulting.

Nor can we judge by IBM’s headcount. Globally, as of the publication of its last annual report, IBM employed 426,751 people. But it has stopped providing a geographical breakdown. A report in the Times of India in 2010, mentioned by The Wall Street Journal, suggested that Big Blue’s headcount in India might be as high as 130,000; which, if true, would make it one of that country’s top 10 employers.

There is no question that IBM’s presence in China has grown. You can tell by the press releases. There was for example, a new IBM Research lab in Shanghai in 2008, and another in 2010. Just last month, IBM announced that it had closed a significant IT deal for a major health-care provider in Hong Kong, and another with a Chinese province to improve the safety of pork (which included a food-safety video I embedded below).

For better or worse, Palmisano will be remembered as the man who traded PCs for access to China. On balance, it seems to have been a good trade, but the jury is still out.

Tomorrow is the first business day of IBM’s Rometty era. Assuming she retires at age 60, a well-established IBM tradition, she’ll have about six years to make her mark. One wonders what she’ll be remembered for most.

The readers of Footnoted, the Morningstar-owned blog that follows the surprisingly fascinating world of SEC filings, annually select its worst footnote of the year — in other words, the best/worst disclosure of 2011. Hewlett-Packard won.

And what prompted the voters to award the world’s biggest tech company this dubious distinction? Its severance payment to former CEO Léo Apotheker, who, according to Footnoted’s reckoning, walked away with $25 million to $33 million following an 11-month stint at HP’s helm, during which its market capitalization declined by more than 40 percent.

Footnoted’s Michelle Leder calculated that range, having dug through the byzantine details of Apotheker’s employment contract as well as the separation agreement that HP filed after he left, and concludes the amount was probably closer to $36 million.

Before he was let go, I had taken a stab at the terms of Apotheker’s contract myself and came to a similar range of $28 million to $33 million. Then, after Apotheker’s departure, I trimmed that estimate a bit based on an HP 8K filing. It’s a tricky business running the numbers on these things, but as Footnoted says, we’ll probably get a final accounting when HP files its annual proxy statement early next year.

Apotheker’s package was part of what likely prompted HP to revise its severance policies, as The Wall Street Journal reported earlier this month. From now on, senior HP execs who get pushed out will have to leave behind unvested stock options and grants of restricted shares.

It’s also worth noting that HP beat out rival IBM in the worst footnote selection. Big Blue was in the running for its disclosure of outgoing CEO Sam Palmisano’s $170 million retirement benefit package, which includes, among other things, a $30 million pension that pays $3.2 million a year for life.

But it’s not the first time that HP has taken fire for the size of its payouts to ousted CEOs. When Mark Hurd resigned in 2010, he walked away with a severance deal worth about $35 million, but then later gave some $13 million back by forfeiting a batch of HP shares as part of a legal settlement with HP that followed his joining Oracle as co-president.

Either way, consumers barely waited until Santa got back to the North Pole before hitting up the stores again.

ComScore reports that e-commerce spending for the first 48 days of the holiday season — ended Dec. 19 — reached $32 billion, jumping 15 percent over last year. In one week alone, at least four individual days surpassed the $1 billion mark.

And IBM, which analyzes mobile shopping trends using data from 500 retailers nationwide, said shoppers continued pulling out their credit cards on Christmas Day, as they shopped for themselves after shopping for others.

IBM found that on Dec. 25, online sales grew by 16.4 percent over Christmas Day 2010. (IBM’s results do not include Amazon.com, the Internet’s largest e-tailer.)

Many of the online sessions on a retailer’s site were initiated from a mobile device, accounting for 18.3 percent of traffic, up from 8.4 percent last year. Mobile sales grew to 14.4 percent versus 5.3 percent on Christmas last year.

As stated in a report that came out earlier this week, most mobile shopping was conducted on iOS devices. The iPad led all mobile-device traffic at 7 percent, followed by iPhone at 6.4 percent and Android at 5 percent, according to IBM.

Many of the days surrounding the holidays have acquired quirky nicknames, such as Cyber Monday (the Monday after Thanksgiving), Black Friday (the day after Thanksgiving) and Green Monday (the second Monday of December).

Perhaps this Christmas will qualify as Sofa Sunday.

The term was first introduced to me by Joaquin Ruiz, the co-founder and CEO of Padopolis, which makes a catalog app for the iPad. He was hoping the Sunday after Thanksgiving would see a spike in traffic after everyone hit the mall on Black Friday and then curled up on the couch with their iPad the following Sunday to recover.

This year, Christmas Sunday’s shopping spike continued into Monday, also known as Boxing Day. IBM said that online sales were up 10 percent by midday on Monday, over Dec. 26 last year, and that mobile sales were up 13.8 percent.

(Image courtesy of iStockphoto | mattjeacock)

Despite everything, corporate spending on IT was going to hold steady, went the conventional wisdom. Big tech companies selling to big companies — except the financial ones — were supposed to have the situation well in hand. All those big companies looking to get things done in a faster, cheaper and more efficient manner would be writing big checks to the big lumbering tech companies, which would translate into operational savings: Faster servers, faster PCs, cloud services, better software.

At least that was the conventional wisdom until today. Now Oracle has gone and harshed whatever buzz there was left. Once investors got their heads around the wider implications of the software giant’s disappointing quarter, they concluded that the entire enterprise tech sector required a sharp spanking. Here’s a rundown of the damage:

• Oracle shares fell by $3.40 or nearly 12 percent, and briefly traded within 20 cents of their 52-week low.
• IBM, recently the engine of steady, dependable tech growth, fell $5.77, or more than 3 percent.
• Cisco Systems fell 49 cents, or more than 2 percent, and teamed up with Big Blue as the day’s worst Dow performers.
• Salesforce.com fell 5 percent.
• VMWare fell nearly 10 percent.
• SAP fell $3.49, or more than 6 percent.
• Hewlett-Packard held up (relatively) better than the rest, falling only 47 cents, or less than 2 percent.

Okay, you get the picture. Investors wanted out of any stock that touched enterprise tech today. Oracle is considered a bellwether. The result was predictable. But does the crux of the argument that fueled today’s fear have any merit? Maybe not.

There are reasons to hope it’s not quite so bad. For example, IT consulting house Accenture, which saw its own stock fall more than 4 percent today, recently reported a pretty good quarter, with record revenues and earnings. Its strength came from $7.8 billion in new bookings, which isn’t exactly a negative indicator.

Second, even if corporate spending does slow down, tech M&A deals could help larger companies grow despite themselves. Oracle, Cisco and IBM have a combined $87 billion in cash and short-term investments among them. And as we’ve seen, there’s still plenty of appetite among large tech companies for gobbling up smaller ones, especially in the red-hot software-as-service space.

Recent examples include SAP’s $3.4 billion acquisition of SuccessFactors, Oracle’s $1.5 billion deal for RightNow, and Salesforce’s grab of Rypple.

And the potential targets are numerous: There’s Taleo, NetSuite, Workday; even newly public Jive Software.

Finally, the currency weakness that has Oracle and so many other companies running uphill when dealing with non-U.S. customers isn’t going to last forever. Yes, it’s true that IT companies like it better when the dollar is weak against the euro. Considered from that angle, Oracle and other global tech companies suffer less from a demand problem than a temporary — though it is going on way too long — currency problem.

But even if the euro crisis does last well into next year, there are still the BRIC countries, which Intel, another significant tech bellwether, can’t stop praising. And — dare I say it? — the U.S. economy is showing signs of coming back to life. In several states, private payrolls are growing just enough to offset the declines in employment at state and local governments, and as new tax revenue flows, government payroll declines will slow, as well. As 2012 wears on, the U.S. might find itself rolling into an honest-to-goodness recovery, which would fuel improvements to IT budgets. Though the hard-drive shortage caused by the flooding in Thailand won’t make this any easier.

So don’t worry. Or don’t worry too much.

It’s not the only one: Several enterprise software and hardware players are falling right along with Oracle. Salesforce.com, whose primary customer relationship management software rivals Oracle’s, has fallen more than $8, or more than 8 percent. Oracle’s primary software rival, SAP, is down by more than $3, or more than 5 percent. IBM has fallen $6.73, or more than 3 percent. Hewlett-Packard is down 50 cents, or nearly 2 percent. Dell is down 40 cents, or more than 2 percent. Microsoft is falling, too, but not as much.

It looks a lot like what Cannaccord Genuity analyst Richard David predicted in a note to clients this morning. Oracle is something of a bellwether for software company and corporate IT stocks in general. A lot of the problems that sapped Oracle’s results this quarter, David wrote, are specific to Oracle. But in the minds of investors it doesn’t matter:

“Much of the miss was company specific, but it won’t matter this morning. Investors are likely to use this miss as a reason to pound software on Wednesday. We believe Oracle’s miss, combined with Red Hat’s heavily punished but modest scuffle on Tuesday, will first hit infrastructure stocks like VMWare, Citrix Sysems and then for good measure high fliers like Salesforce.com. Our view is more nuanced; Oracle missed because some buyers waited for a new hardware upgrade, and on the software front the firm is behind the curve in cloud applications. We expect Oracle to catch up, but it will be through some R&D and a lot of M&A. We would “back up the truck” on Salesforce if traders knock that stock down because cloud software companies are very likely to gain significant market share from non-cloud vendors.”

Davis cut his rating on Oracle to “Hold” from “Buy,” arguing that the shares will “trade sideways for the next two to three quarters.” Even after an expected “dead cat bounce” — a quick price recovery after a significant fall — Oracle will have some work to do. “Oracle will have to rebuild confidence that the firm is not is not headed to Microsoft’s valuation level over the next few years. Therefore, we can no longer rate Oracle a Buy.”

Not everyone was quite so negative. FBR analyst David Hilal, in a note to clients this morning, lowered his estimates on Oracle’s sales and profits for fiscal 2012. He now expects Oracle to report per-share profits of $2.36, down from $2.44, and cut his sales estimate to $37.7 billion from $39 billion. He also lowered his target to $34 from $38. Even so, he’s still bullish generally, albeit with lower expectations. “The macro debate will now focus on whether IT spending is finally coming under pressure due to broader economic concerns,” Hilal wrote. “While IT spending is not immune to such macro factors, we are not forecasting a material slowdown as we believe enterprises have already been cautious regarding their spending. However, some modest pullback should be expected, particularly post a seasonally strong end to the year.”

BMO Capital analyst Karl Keirstead didn’t agree with Hilal on that point. “Given some weak recent data points from Red Hat, Salesforce.com, Intel and Accenture, we conclude that the macro IT spending backdrop in fact weakened and that the miss was not related to Oracle execution or share losses,” he wrote in a note to clients this morning. “We assumed that Oracle could manage through this tightness and we were obviously wrong.” He lowered his price target to $32 from $38 but maintained a “buy” rating.

Other analysts downgraded Oracle, too. Societé Generale analyst Richard Nguyen cut it to “Hold” from “Buy.” CLSA slashed Oracle shares to “underperform” from “buy,” and lowered its price target to $30 from $36. Deutsche Bank analyst Thomas Ernst lowered his target price to $29 from $33. It’s just one of those days.

So what happened? A few things, as Oracle execs tried to explain on a conference call.

• The currency effect: As President and CFO Safra Catz explained, what had been a 1 percent tailwind for currency effects turned into a 2 percent headwind. With all the violent swings in the value of currencies around the world as compared to the U.S. dollar, Oracle suffered a negative effect that pinched revenue.

• Deals didn’t close during the quarter: Catz said that in the final days and weeks of the quarter, some customers added an extra layer of executive approval to close deals to buy Oracle stuff. That meant that some deals Oracle had expected to close before the quarter’s end moved into the next quarter. Catz said that Oracle has taken steps to better manage deal flow to take this into account. It is consistent, however, with recent statements from other enterprise IT vendors, like IBM and NetApp.
• Transitions: Oracle’s SPARC server business just switched to a new chip called the T4, which was unveiled late in the quarter. The machines require a total upgrade, and that means a lot of testing with existing applications, which can slow down deals for the new machines, while at the same time sapping demand for the prior generation of products. That had a lot to do with hardware sales dropping by 14 percent year over year to $953 million. As Catz put it: “We saw good early demand for the new SPARC SuperCluster, but only released the product for general availability at the very end of the quarter, allowing us to ship only a couple.”

Catz also predicted that hardware sales will decline as much as 14 percent this quarter, although CEO Larry Ellison was bullish on its growth prospects later this year. New software license revenue, a key metric gauging software sales, is expected to grow in a range of 2 percent to 12 percent. Total sales are expected to grow in the range of 3 percent to 7 percent, and per-share earnings are expected to come in between 56 and 59 cents, which is in line with the consensus of analysts.

There were a few things that went right. Ellison did what he usually does on a conference call, and crowed about examples where Oracle is beating a competitor. This time, the targets were IBM, Cisco Systems and SAP, but not his usual punching bag, Hewlett-Packard. Oracle won several competitive deals from Big Blue and Cisco, as well, with customers as varied as Australia’s University of Melbourne, the U.S. Food and Drug Administration and the Hyundai Kia Motor Company.

Ellison also hinted that Apple is a big Oracle customer. He mentioned a “a very large American smartphone manufacturer” that had bought more than 30 Oracle Exadata systems as it built out its cloud. Unless I’m missing something, there’s really only one company that fits that description, and that’s Apple. Its use of Oracle gear within the mix at its North Carolina data centers has been speculated about before, but never confirmed by Apple directly. (Big surprise, that.)

One example is the annual tech prediction by analyst Mark Anderson, which I wrote about last week. Another is IBM’s recurring “Five in Five” series, wherein Big Blue looks at the unfolding technology landscape and predicts what innovations are still just this side of “gee whiz” today, but will be commonplace within five years.

Think back to what we were doing in 2006, and how far things have come in that short period of time in terms of consumer and enterprise technology. The iPhone existed only as an Apple prototype. Facebook had just opened itself up to the population at large, beyond just college and university students. Twitter was just getting started. And a tablet was a not-terribly-popular PC design.

As you’ll see, some of these five predictions aren’t exactly mind-blowing, especially if you pay attention to general technology trends. Over the past decade, you’ve probably already heard predictions saying that computer passwords will go away and be replaced by biometrics of some kind, whether in the form of fingerprints or voice authorization or some part of your eyeball. Also: Junk mail I actually want? That one I’ll believe when I see it. However, I really like the “think to call” idea, which sounds like a super speed-dial.

Anyhow, here are IBM’s predictions for stuff we’ll see by 2016, and a video explaining them in a little more detail:

You will make your own energy: Anything that moves has the potential to create energy. Your running shoes, your bicycle and even the water flowing through your pipes can create energy. Advances in renewable energy technology will allow individuals and scientists to collect this energy and use it to help power our homes, offices and cities.

You will not need a password: Your biological makeup is the key to your individual identity, and soon, it will become the key to safeguarding it. Each person’s unique biometric data such as facial definitions, retinol scans and voice files will be composited through software to build your DNA-unique online password. You will be able to log into your mobile phone or have access to an ATM machine by simply speaking your name or looking into a camera.

Mind reading is no longer science fiction: Scientists are researching how to link your brain to your devices, such as a computer or a smartphone, so you just need to think about calling someone and it happens. Scientists have designed headsets with advanced sensors to read electrical brain activity that can recognize facial expressions, excitement and concentration levels, and thoughts of a person without them physically doing anything.

The digital divide will cease to exist: In five years, the gap between information haves and have-nots will narrow considerably due to advances in mobile technology. Growing communities will be able to use mobile technology to provide access to essential information and better serve people with new solutions such as mobile commerce and remote healthcare.

Junk mail will become priority mail: Think about how often we’re flooded with advertisements we consider to be irrelevant or unwanted — it doesn’t have to be that way anymore. In five years, unsolicited advertisements may feel so personalized and relevant it may seem spam is dead. Systems will be able to filter and find only the data that’s important and relevant to you and will bring you the information without you having to ask for it.

Emptoris is based in Burlington, Mass., and its customers include American Express, ADP, Kraft Foods and Samsung America.

IBM is describing the deal as the latest move to fill out its “smarter commerce” initiative. And if you follow IBM, you know that making something “smarter” — whether it’s commerce or a city or the entire planet — generally means throwing some computing power and analytics up against a classic, complicated problem, which frankly, supply chains always are.

When you start looking at the patterns of what companies buy in the normal course of doing business — how often and how much not having some critical component or material can disrupt production — you start to see inefficiencies that cost time and money. Eliminate those inefficiencies, the thinking goes, and you start shaving down those costs, and start running the business in a more efficient manner. Usually, the saved costs go straight to the bottom line. That’s something that any CEO or CFO can get behind, and IBM says that doing this sort of thing is a $20 billion global market opportunity on software purchases alone.

IBM’s press release quotes Craig Hayman (pictured above), its general manager of industry solutions, who talked to AllThingsD in July about how IBM is helping companies manage their marketing. Hayman says that corporate procurement departments are increasingly being asked to show how they deliver value to a company. Emptoris will fit alongside IBM’s 2010 acquisition of Sterling Commerce.

Financial terms of the deal haven’t been disclosed, which means it’s a relatively small deal for Big Blue. But it’s also the second deal it has done this month in the smarter-commerce area. Last week, IBM spent $440 million to grab DemandTec, a software outfit that specializes in analyzing buyer behavior.

By 11:15 am ET, IBM shares fell on the news by 99 cents, or less than 1 percent, to $187.73. The shares have been on a steady climb all year, and as of yesterday’s close were up nearly 29 percent since the start of 2011.

Ahead of the dinner, Anderson stopped by my office to let me have a peek at his 10 predictions, and we talked them over a bit. All 10 are below, along with some comments from Anderson that emerged from our conversation.

Before diving into the predictions, Anderson tells me there is a grand theme that unifies them all: “Integrating everything.”

What does that mean? “It means a whole lot of stuff that needs to be integrated. We don’t need anything new at all. There’s so much work that needs to be done with the existing tool sets. Steve Jobs didn’t really invent anything at all. But he was great at integrating things into a product. There’s a lot more of that work to do. We have to do it in the phone world and the TV world and the health care world. We have lots of devices and lots of chips and lots of operating systems and lots of content. The bigger question is, how do human beings use it all efficiently?”

As an example, he cites the collaboration between Nuance, the speech software company, and IBM, bringing the Watson computer of “Jeopardy” fame into the area of health care. “For the first time, the idea of evidence-based medicine won’t just be in a magazine article,” Anderson says. “A doctor will be able to pick up his phone and describe four symptoms, and find out what the likely diagnosis is, what the indications are. It’s fantastic.”

So here are those 10 predictions, with additional comments from Anderson:

1. TV becomes the new center of gravity in the tech universe. All the other devices find their niches in the TV galaxy. Microsoft’s attempt to integrate Kinect into TV is a strong if qualified success. Smart phone-TV integration software becomes a new category. Pad-TV integration becomes common.

“Apple will hustle to launch the next version of Apple TV, and it will be a roaring success and be seen as Tim Cook’s first great product success. But what it really will be is Steve’s last product.”

2. 2012 will see tectonic shifts in phone markets. “Nokia will fail to come back, which is pretty clear to everyone except the people in Finland.” Samsung, Anderson says, will retain its spot as the new global leader in mobile phones by volume, and will keep this crown despite the debut of Microsoft’s Windows Phone 7.

Meanwhile, Anderson says, Google will lose control over the Android operating system, mainly because unlicensed versions of Android will multiply in type and in installed base, especially in Asian countries. “It’s already a balkanized environment. Now Google loses control of the technology entirely. China is already running an unlicensed version of Android, and I think there will be more of that.”

Finally, the smartphone will finally emerge as the dominant category of wireless phone. “Why would you have anything else? And why would sellers of content and services want you to?” he says. “It doesn’t matter if you’re in a rich country or a poor country. This stuff is cheap.”

3. Clouds are for consumers, and for start-ups. Even as a large number of big companies move pilot projects onto external clouds, it will become clear that the real trend is for enterprise to stay away from clouds in all key areas, for reasons of both security and reliability.

“The cloud guys hate this because they want to sell to enterprises,” Anderson says. “But the security issues are becoming really intense. If you’re a CIO, it’s a terrible environment, and you’re a target, for sure, especially if you’re a company with a lot of intellectual property. I’m not implying that things like SAAS (software as a service) aren’t a big trend. But no one is going to put their valuable IP on the cloud.”

4. Security splits the tech world in two, finally getting attention from CEOs. Companies with real IP start to realize they have to “go big or go home” with their security response, and their spending on protecting their “crown jewels” rises dramatically.

5. Siri stuns the world. Siri, on Apple’s iPhone 4S, has sounded the arrival of Internet personal assistants, and the world will spend this year marveling at what Siri and its rivals can and cannot do — and what they can learn to do.

“I think we’ll see a bunch of these things,” Anderson says. “Siri will get much better. It will learn how you learn. We’ve never seen people have long-term relationships with machines before, but it will be a long-term relationship, and she will remember everything, but make good use of it. She will know you learn better by seeing than hearing, or that it takes three times to tell you something. All those things that you have to program today should be learnable. None of that has been done yet. That creates a real friendship. And I think we’re going to start seeing personal assistants not just for everyday life, but for professions like medicine or car repair. Instead of just having Siri be everything, there will be many Siris for different contexts.”

6. We enter the amazing world of Dave and HAL, as voice recognition comes of age. From hospital to car, mobile to home, Kinect to Siri, exercise to play, work to entertainment, remote control to direct action, from Microsoft to Apple, from Tellme to Nuance — the time has come for computers and humans to talk to each other. With lots of funny stories, big bloopers and amazing breakthroughs, humanity at the end of 2012 will be talking to machines in a normal voice, and it will not seem unusual, nor be the cause of unending frustration.

“The voice-recognition part is almost trivial,” Anderson says. “The important part is context-sensitive understanding. It used to be that all the researchers at Carnegie Mellon used to think that all you needed was more computing horsepower to do better at voice. It turned out that was wrong. It was right for a little while, but the real problem is context. And so, if you can build up that database where you can search it contextually for what to expect, that is where you get all the mileage.”

7. E-readers prosper, but pads continue to dominate what Anderson calls the “carry-along” market. Pads and tablets will come down in price and get closer to prices of e-readers. Meanwhile, Anderson says, Amazon’s Fire will move upmarket and evolve into a full-fledged tablet.

“If you look at the specs on the Fire, it’s a tablet, but it’s hobbled,” Anderson says. “So I think that this is part of the whole strategy: Come in and sell at a low price, and then later unveil a more complete tablet. Apple will stay ahead, though. A lot of people are asking me if Amazon will catch Apple, and the answer is no. The way it’s configured right now, there’s no way the Fire will catch up with the iPad.”

8. The consumption world explodes. Get ready for new devices, new content, new bundles, new connection techniques, new distribution channels, new aggregators, new tablets, new phones, new players, new self-published authors, new garage bands, new consumption models riding on social networks. There is nothing but high energy in the content consumer market. People are now ready to spend subscription money, and the publisher response will be huge. “It’s going to be a huge melee of stuff,” Anderson says. “We’ll invent more stuff to consume, and it will be very hard to figure out who the players are from week to week, and how they’re doing. They may not even know themselves.”

9. Governments and corporations focus on intellectual property as though it were their most prized asset. It is. This new global understanding leads to a reevaluation regarding giving critical IP away for nothing versus protecting it. The age of what Anderson calls “IP naïveté” is over, and the question of proper IP valuation is here.

What is IP naïveté? “When Jeff Immelt stood on the steps of the White House the day after he was named jobs czar, and handed the plans for GE’s most important jet-engine project to Hu Jintao in order to get the permission to be allowed to bid on maybe selling engines to China — that’s IP naïveté,” Anderson says. “Thinking that’s not going to come back and show up for sale in Houston from some Chinese company in about six months is IP naïveté.”

During 2012, he says, companies and countries will start valuing their intellectual property not for its replacement value, but for figures that are magnitudes larger. State-sponsored IP theft will shift from being considered a nuisance and more along the lines of an act of aggression.

10. Amazon gets it all. Between outdoing Wal-Mart online, to beating the booksellers and delivering groceries, and making new inroads in video streaming, Amazon will prove that one company can indeed have it all. Strong Kindle and Fire sales will only be icing on the cake.

Holders of DemandTec, which makes software to predict demand for retail and consumer-product companies, will get $13.20 a share in the all-cash deal, a 57% premium to Wednesday’s close. The deal is expected to close in the first quarter.

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In a final tally, comScore reports that $1.25 billion was spent online yesterday in the U.S. This exceeds last year’s record of $1.028 billion by 22 percent.

There was evidence early on that Cyber Monday was on track to produce record sales, with research firms releasing updates almost hourly. Others, including IBM, confirmed the strong gains reported by comScore.

The comScore figures only include purchases made from devices connected to fixed Internet connections (i.e., computers); IBM’s analysis includes mobile shopping, using data from 500 retailers nationwide that use its systems.

IBM found that online sales were up an impressive 33 percent on Cyber Monday compared to 2010, with a large majority of shoppers using mobile devices.

Though the name Cyber Monday might lead one to expect the busiest online shopping day of the year, historically that particular Monday has failed to outdo other days closer to Christmas. In fact, there’s still plenty of time this year for additional billion-dollar-plus days to come, if consumers are indeed spending more and not just looking for steep discounts.

So far, the consumer trends suggest we are headed for a strong Christmas season.

Cyber Monday followed a busy Black Friday, with comScore reporting $1 billion in online sales, a 16 percent increase over last year’s day-after-Thanksgiving shopping phenomenon. Online sales for November have already reached $15 billion, a 15 percent increase over the first 28 days of the month last year.

Those numbers don’t include commerce conducted on mobile phones and tablets, which people are using to shop during their commute or from their living room couch. IBM found that 10.8 percent of people used a mobile device yesterday to visit a retailer’s site, up from 3.9 percent in 2010. Additionally, mobile sales grew dramatically, reaching 6.6 percent versus 2.3 percent in 2010.

Mobile sales in particular were driven by Apple products, namely the iPhone and iPad, which collectively accounted for 7.4 percent of all online retail traffic. The top three devices — iPhone, iPad and Android — accounted for 4.1 percent, 3.3 percent and 3.2 percent of all online retail traffic, respectively.

The eBay-owned PayPal also reported massive mobile sales growth on Cyber Monday, with global mobile payment volume jumping 552 percent compared to the same day last year.

(Image credit: ©iStockphoto.com/mbortolino)

In a market that grew overall by more than 5 percent to $12.3 billion in revenues and 2.2 million servers sold, HP and IBM were neck and neck on a revenue basis, each accounting for about $3.8 billion, or about 29 percent of the market, followed by Dell, Oracle and Fujitsu.

On a unit basis, HP was the undisputed king, selling 693,000 servers, which works out to an average price of about $5,500 each. IBM sold 288,000 at an average price north of $13,000. Dell sold 518,000 servers.

For HP, both figures represented year-on-year declines of about 3 percent, and are roughly in line with the results HP reported last week. HP said that sales of industry standard servers, meaning those that run regular Intel chips, were down 4 percent, and business critical servers — the ones that run the exotic Intel Itanium chip — were down 23 percent, thanks in no small part to the ongoing scrap with Oracle.

Generally, the server market was healthy worldwide, except in Western Europe, where sales declined by about 5 percent. Asia, on the other had, made up for that by growing nearly 24 percent. Eastern Europe did even better, growing more than 27 percent.

Demand was strongest for basic x86 servers, running chips from either Intel or Advanced Micro Devices, where growth was north of 9 percent on a revenue basis. Servers running Itanium and RISC chips, which include things like IBM’s Power architecture and Oracle’s SPARC, declined on a per-unit basis, but oddly saw revenue increase a little, meaning that those machines sold are for one reason or another commanding a higher price.

(Image from Treehugger.com)

In a Cisco blog post, the company’s general counsel, Mark Chandler, accused HP of overzealously lawyering up to try to stop former HP employees from going to work for Cisco. The fear is that those former employees will share HP’s confidential information to Cisco’s benefit. “Trade secrets are protected by intellectual property laws, not by non-compete agreements and vague theories that a new job would ‘inevitably’ cause an employee to use trade secrets of his or her former employer,” Chandler helpfully reminded HP’s legal team.

Courts in California have generally held the kind of noncompete agreement that would prevent someone leaving HP for Cisco, or vice versa, to be unenforceable. But one of the people in question used to work for HP in Texas, and moved to California for the Cisco job. HP lawyers, Chandler says, swooped into a courtroom in Texas hours before a related hearing in California (the point being that the court that hears the case first is the one that tends to decide the case).

Chandler doesn’t name the employees involved, but that Texas-to-California move sounds an awful lot like the case of Paul Perez, the former CTO of HP’s StorageWorks, who resigned earlier this month for a job at Cisco; John Marsh, at the Ohio law firm of Hahn Loeser, writes about the case here.

I asked HP for a comment on this, and they haven’t gotten back to me. However, HP is not the only one with aggressive lawyers trying to enforce noncompetes. A federal appeals court recently ruled in favor of HP and an executive it had hired earlier this year from IBM. Giovanni “John” Visentin, who had been a general manager, quit his job at IBM in January and said he was going to HP, but offered to stay on for a transitional period. IBM sued him the next day, and asked the court for an injunction that would have prevented him from taking the job. The trial judge and the appeals court both ruled that IBM’s aggressive behavior made the “emergency” its lawyers said existed worse by its refusal to even talk to the employee.

Chandler closes his post with a promise that the company “will apply California’s rule in favor of employee mobility nationwide,” which is a comfort should you be mulling a job offer from Cisco and work at a rival outfit.

And though the circumstances are different, Cisco is not without its own history of over-aggressive lawyers, as in the infamous case of Peter Adekeye, a former Cisco employee who started his own company servicing Cisco gear; Ars Technica covered the case here. Having filed an antitrust suit against Cisco in the U.S., Adekeye wound up arrested and detained in a Canadian jail. A judge there finally let him out, saying that the only “reasonable inference I can draw from the facts is that the criminal process was used to pressure the applicant (unsuccessfully) into abandoning his antitrust lawsuit against Cisco.”

When it comes to ex-employees, lawyers tend to get really tough.

Update: Like I said, the Adekeye case is different circumstances, and as a Cisco spokesman points out in the comments below, Adekeye is under indictment; though it’s been described as a “ridiculous” case, you sure can’t beat it for weird legal twists and turns.