Knowing the financial health and business direction of the major school technology vendors enables you to make more sophisticated judgments about which companies have the wherewithal to support the eSchool concept. With that in mind, we’re launching a new department this month called Biz Buzz, a short round-up of recent business news affecting K-12 marketers.
Hewlett-Packard appoints former Lucent chief as president, CEO
Just hours after taking over one of the world’s largest computer companies on July 19, Hewlett-Packard’s newly appointed president and chief executive, Carleton Fiorina, was already clamoring for change.
“We’re going to need to reinvigorate our sense of speed, our sense of urgency,” she said.
Fiorina, 44, steps into what she described as “the big shoes” of Lewis Platt, 58, who is retiring at a time when the 60-year-old company, a granddaddy of the Silicon Valley, has been criticized by industry observers for being conservative, old-fashioned, and slow.
For the past three years, quarterly earnings have generally failed to meet Wall Street expectations. And even Platt acknowledged that competitors Sun Microsystems Inc. and IBM Corp. had taken the lead in internet commerce.
Platt said that’s why he looked outside the company for his replacement.
Fiorina, one of the top women executives in the world, comes to Hewlett-Packard after nearly 20 years of technology experience and a track record of growing large businesses.
Most recently, she has been president of the telecommunications network services business of Lucent Technologies. She also managed Lucent’s 1996 initial public offering and subsequent spinoff from AT&T Corp.
Like HP founders Bill Hewlett and Dave Packard, Fiorina is a graduate of Stanford University, where she studied medieval history and philosophy. She went on to receive an MBA from the University of Maryland before she began working for AT&T in 1980. At AT&T, she was promoted into the network systems business, a precursor to Lucent.
Although no other major computer company is led by a woman and only two other Fortune 500 companies are led by women, Fiorina downplayed her gender, saying that “there really is not a glass ceiling anymore.”
“This is a company that has always attracted the best and brightest talent, no matter what their gender,” she said. “My gender is interesting, but really not the subject of the story here.”
What is the subject is how Fiorina plans to reinvent HP to help it compete in the growing field of eCommerce.
To bolster its new Internet Business Unit, formed to create internet software, solutions, appliances, and services, HP has begun to acquire internet companies like Open Skies, which makes software for selling airline tickets online. In addition, the company has been taking equity stakes in internet companies that then promote HP hardware.
Jonathan Ross, an ABN Amro analyst in San Francisco, said Fiorina’s high-tech communications experience will serve her well as she pushes a traditional computer company into the internet world.
“The fact that she comes from a telecom background will help HP solidify its position as a major internet player,” he said.
Investors were cheered as well, pushing shares of Hewlett-Packard up $2.25 to $116.25 in trading on the New York Stock Exchange when Fiorina’s leadership was announced.
Advantage Learning completes a pair of acquisitions
Advantage Learning Systems Inc., of Wisconsin Rapids, Wis., closed out a pair of aquisitions over the summer that will help the company bolster its offerings in the areas of teacher professional development and writing skills software.
Advantage Learning acquired Generation21 Learning Systems LLC, a Denver-based developer of enterprise software for training and knowledge management, and Humanities Software Inc., an Oregon-based firm that specializes in writing software.
Founded in 1997, Generation21 provides software that develops and manages all aspects of training throughout organizations and publishes training in all media, including internet, intranet, CD-ROM, print, and instructor-led training. Its system has been adopted by more than a dozen major organizations, including Lockheed-Martin and Novell Inc., Advantage Learning said.
While continuing its new subsidiary’s existing business, Advantage Learning plans to use the system to expand its own professional development training for teachers. Advantage Learning also will provide the system to large school districts to help them meet their internal training needs. Advantage has trained more than 15,000 educators since 1994, the company said.
The new subsidiary will be headed by Michael Watkins, who previously served as general manager of the software company Printrak International. Watkins will work with Generation21 founder Dale Zwart, who remains with the company as executive vice president and chief technology officer.
Humanities Software publishes award-winning software products that include the popular WRITE ON! Series, which helps develop writing skills through the effective integration of process writing, skill building, and literature; and KeyWords, a program that develops keyboarding skills.
The company was founded in 1984 by children’s book author and psychologist Jon Madian and his wife, Karen Jostad. Madian worked extensively in schools as a language arts teacher and researcher. He is a recognized authority on writing instruction and has served as a consultant on writing and technology to school districts and such firms as Macmillan-McGraw Hill, Edmark, IBM, and Apple.
Jostad is a former manager of software development for MECC. Both will continue with the company, as will the rest of its staff, it was reported.
The Humanities software will form the basis for several new learning information systems for the teaching of writing skills, which Advantage Learning expects to develop and release over the next one to two years, according to Chief Executive Officer Michael Baum. In conjunction with the company’s first writing skills product, Perfect Copy, Advantage expects these new programs to provide “a powerful, complete software solution for accelerating the teaching of writing,” he added.
Compaq’s CEO pick surprises Wall St.
Compaq Computer Corp. prompted surprise and some wariness from industry analysts by picking a relatively unknown manager as its new chief executiveits own chief operating officer of less than two monthsto turn around the company’s fortunes.
Michael Capellas, 44, previously was Compaq’s chief technology officer and has served as a sales manager at software maker Oracle Corp. Compaq’s board approved the choice on July 22, trying to plug a big management hole that threatened to further hurt shrinking sales and profits.
Capellas is a native of Warren, Ohio, graduating from Warren G. Harding High School and Kent State University. He got his start in the computer business as a systems analyst for Republic Steel, now WCI Steel Inc., in 1976.
Wall Street generally had expected Compaq to pick an outside executive with seasoned experience in running a major company. But by reaching inside its own ranks, Compaq officials said they wanted to tap Capellas’ experience, however short-lived, in reorganizing the company into more efficient business units aimed at responding better to customers’ needs.
Capellas succeeds Eckhard Pfeiffer, who was forced out in April after Compaq’s first-quarter profit came in at less than half of analysts’ expectations. The management gap was widened by the departure of another half-dozen top managers in Pfeiffer’s wake.
At a news conference in New York, Capellas gave a lively presentation sketching out his major areas of focus, which include reorganizing the company, bolstering sales of PCs and big business machines, and simplifying the company’s methods of distribution.
After pioneering the market for inexpensive personal computers in the early 1990s, Compaq has seen its profits drop lately amid escalating price wars.
Symantec Corp. acquires filtering company URLabs
In an effort to stretch its focus, internet security and desktop management systems leader Symantec Corp. has acquired the Hampton, Virginia-based Unified Research Laboratories Inc. (URLabs).
URLabs is well-known for its I-Gear and Mail-Gear internet and eMail filtering software. The acquisition, announced July 20, is part of a new strategic direction for Symantec to offer internet content security solutions as well as desktop security and anti-virus software.
“Symantec has been an innovator in harnessing the internet to deliver solutions that meet specific customer needs,” said Symantec president, CEO, and chairman John Thompson. “Our new strategy leverages this core competency and makes the internet the common thread in everything we do. We intend to develop content security solutions to keep customers’ data and networks secure when they interact with the internet, and create tools that use the internet to keep remote users productive and secure.”
Based in Cupertino, Calif., Symantec is widely known for its Norton AntiVirus, Ghost, and pcANYWHERE software.
URLabs President Gary Warren will stay on with the company as vice president of market development, assisting Thompson with long-term product strategy and partnerships.
Apple shines as profits reach six-year high
Apple Computer Inc.’s profits and revenues are riding a wave of consumer demand for the unusual-looking iMac desktop computer.
The company reported July 14 that its profits doubled in the recent quarter, topping Wall Street expectations. Apple, based in Cupertino, Calif., credited a 40 percent rise in unit sales of computers. Apple’s share of retail desktop sales was 6.7 percent in May, double that of a year ago, according to research firm ZD Infobeads.
Apple’s profit in its fiscal third quarter rose to $203 million, or $1.20 a share. That was up from a profit of $101 million, or 65 cents a share, in the year-ago quarter.
Revenue rose 11 percent to $1.56 billion from $1.40 billion. Apple said it sold 487,000 iMacs in the recent quarter, up from 350,000 in the previous quarter.
The popularity of the desktop computer has spurred a design shakeup in the PC industry since its introduction last year. The iMac is shaped like a giant jelly bean, equipped with a built-in monitor, and comes in five translucent colors through which inner circuitry is faintly visible. In July, Apple unveiled a notebook computer based on the iMac look, called the iBook.
The company’s stock hit a six-year high in July. Apple shares were at their highest level since 1993, when the first signs of major trouble appeared in the form of huge quarterly losses that persisted until the company finally righted itself last year.
Former FamilyEducation executive to head Boxer Learning
Boxer Learning Inc., a leading internet education company based in Charlottesville, Va., has announced the appointment of Robert S. Block as its new president and chief executive officer.
Block, former vice president of education partnerships at FamilyEducation Network, brings extensive experience in creating and developing a successful and innovative internet-based business that focuses on family and education. The experience and skills acquired during his career at FamilyEducation Network and as an investment broker will allow him to make an immediate impact on the position and growth of Boxer Learning, according to industry expert and consultant Peter Grunwald of Grunwald Associates.
“By bringing Bob Block in as CEO, Boxer is making an aggressive move to become a leader in the online learning space,” Grunwald said. “Bob brings an ideal mix of skills, savvy and leadership. He understands the path to success in our industry, which is mastering the connection between the school and home markets. Education is a relationship-based business, and Bob has demonstrated he can create and execute on winning alliances.”
In his role as CEO, Block will be directing the overall vision, leadership, and future direction of a company that is positioned to be a leading comprehensive, online curriculum resource for learners of all ages in all learning environments.
“I’m excited about the opportunity to join the Boxer Learning team and to help build one of the premier education brands on the internet,” said Block. “We have entered a period of tremendous growth for companies focused on creating online learning environments for students in both school and home, and Boxer is committed to becoming a leader within this emerging industry.”
Boxer Learning currently produces one of the most interactive learning environments on the internet. Its BOXER math.COM site, located at http://www.boxermath.com, features on-demand, web-based, guided math tutorials that promote conceptual understanding, learning through discovery, and a comprehensive self-paced curriculum.
N2H2 goes public with initial stock offering
N2H2 Inc. (Nasdaq: NTWO) announced on July 30 that it would make its initial public offering of 5 million shares of common stock at a price of $13 per share. Of the shares being offered, 4,950,000 are being sold by N2H2 and 50,000 are being sold by selling shareholders. N2H2 will not receive any proceeds from the sale of common stock by the selling shareholders, the company said.
The offering is being made through an underwriting group managed by CIBC World Markets of New York and U.S. Bancorp Piper Jaffray of Minneapolis.
N2H2, located in Seattle, is a leading provider of server-based internet filtering solutions to schools and is the developer of Searchopolis.com, an educational internet portal. N2H2 develops and delivers internet content management solutions to its customers in the school, home, corporate, and international markets. The company currently provides its flagship web filtering service, Bess, to about 7.3 million students in 8,000 schools in the U.S. and Canada.