Welcome to the Cloud Wars Minute — your daily cloud news and commentary show. Each episode provides insights and perspectives around the “reimagination machine” that is the cloud.
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In today’s Cloud Wars Minute, I discuss the remarkable growth of so-called legacy tech companies like Oracle, SAP, and IBM during the early stages of the AI revolution.
Highlights
00:28 — The whole AI industry and its buyers love the so-called legacy tech companies, right? Over the last nine or ten weeks since I did my last iteration of the Cloud Wars Cloud & AI Confidence Index, the market caps of Oracle, SAP, and IBM have soared. These are three of the companies that so-called experts have, over the last several years, pegged as being out of touch
01:23 — I’m comparing market caps from July 18 to September 23. Microsoft, at $3.27 trillion on July 18, fell to $3.22 trillion, 1.5%. Google (under Alphabet) saw its market cap drop $200 billion to about $2 trillion, down almost 11%. Oracle’s market cap increased by $75 billion to about $460 billion, up 19.2%. Amazon rose by $70 billion, up 3.6%. SAP rose $35 billion, a 14.2% increase.
02:42 — ServiceNow saw its market cap increase by $41 billion over this period, reaching close to $200 billion — a whopping 26.8% increase. Workday’s market cap increased by 4.3% over that time, up 7%. Salesforce saw an $11.1 billion increase, up 4.6%. And IBM is up $27.5 billion over these nine or ten weeks — that’s a 15.9% increase. Credit goes to CEO Arvind Krishna.
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03:38 — Consider the ages of these companies: Oracle is 47 years old, SAP is 52, and those are infants compared to IBM, which is 113 years old. I give each company a huge amount of credit for bringing their organizations forward into this very different time. IBM has shifted its big portfolio, so it’s now really focusing on what customers need around AI, data, and security.
04:23— While each of these companies has a different approach, their market caps reflect the public’s belief that they will be the growth companies of tomorrow. I hope this is the final nail in the coffin for the idiotic notion that these are somehow “legacy” companies that have had their day, like dinosaurs or woolly mammoths.
