5 Companies That Had A Rough Week

The Week Ending Aug. 28

Topping this week's roundup of companies that had a rough week is a series of executive defections from the EMC Federation, including VMware and VCE.

Also making the list is Google's lost ground in the cloud applications channel; a significant and surprising executive resignation at Lenovo; the challenges facing Apple's iPhone in competing with low-cost Android devices; and a data-center failure that shut down a brokerage's trading operations during a hectic week for stock exchanges.

Not everyone in the IT industry was having a rough go of it this week. For a rundown of companies that made smart decisions, executed savvy strategic moves -- or just had good luck -- check out this week's Five Companies That Came To Win roundup.

EMC Federation Hit By Multiple Executive Defections

EMC's subsidiaries were hit this week with the departure of some key managers.

Word came during the weekend that VMware chief technology officer Ben Fathi had resigned after more than three years at the company and a year-and-a-half in the CTO job. While Fathi told CRN he was talking to other companies, he hadn't decided where he's heading next. Fathi's sudden departure came just a week before the kickoff of the company's annual VMworld customer conference.

CRN also learned during the weekend that longtime EMC and VMware storage executive Chuck Hollis had left VMware for a job at Oracle. Hollis had been VMware's chief strategist of storage and availability for the last two years, following 19 years in various roles at EMC. And Tuesday news surfaced that Mark Thurmond, senior vice president of global sales at VCE, had taken an executive vice president job at business intelligence software vendor Qlik.

Google Losing Ground In Cloud Apps Channel

Google, a pioneer in the cloud applications arena, is losing momentum as many of its channel partners add Microsoft's Office 365 to their lineup -- and some solution providers are abandoning Google altogether, according to a CRN story this week.

As many as 80 percent of Google's several hundred once-exclusive regional partners are now selling Microsoft Office 365. One source told CRN that gross margins on Google Apps licensing and services have dropped by as much as a third in the past two years, while margins on Office 365 have climbed significantly during that time. Another issue is a $500,000 required minimum in new business, starting next year, to qualify for Google's top partner tier.

A Bitglass report issued this week said Microsoft has knocked Google off as the leader of the cloud office productivity application market.

Google does win some channel kudos for introducing a way for partners to actually resell Google Cloud Platform services instead of simply acting as sales agents.

Head Of Lenovo's Enterprise Business Resigns

The EMC Federation wasn't the only one with executive departure woes this week. Lenovo confirmed that Jay Parker (pictured), senior vice president of the company's Enterprise Business Group, resigned after holding that post for less than six months.

No additional information about Parker's exit was disclosed. Gerry Smith, executive vice president and COO of the company's PC and enterprise business group, will temporarily fill the job until a permanent replacement is named.

Parker had been with Lenovo since 2007 in various posts. His departure comes as Lenovo wrestles with faltering earnings amid softness in key markets.

Forecast Says Apple iPhones Face Serious Challenges From Android Devices

Apple got some bad news this week: A new report from IDC stated that while the company's iPhones rule in the high-end smartphone market, the iOS-based devices face serious competitive challenges from low-cost Android mobile phones.

The mobile phone forecast released Tuesday said that Apple's higher costs will be a disadvantage due to price sensitivity in vital markets with the biggest growth opportunities.

Android devices are expected to dominate the smartphone market with 81.1 percent share this year and 9.9 percent sales growth. While iPhone sales are projected to grow 16.1 percent this year, they will still have only 15.6 percent of the market, a number IDC forecasts will slip to 14.2 percent by 2019.

CenturyLink Data Center Failure Halts Stock Trading

There's never a good week for a broker to have to halt trading because of data-center problems. But with this week's volatile stock markets and frenzied trading, this was an especially bad week.

Investment Technology Group, an electronic brokerage, had to suspend trading Thursday due to what ITG described as a "catastrophic problem" with a ventilation and air conditioning system in its Weehawken, N.J., data center. The data center is operated by CenturyLink.

The breakdown forced ITG to take its private trading venues, including the Posit dark pool, offline at about 1:00 p.m. EDT for the rest of the day, according to a Wall Street Journal story.