[HN Gopher] Hitachi to buy U.S. software developer GlobalLogic f...
___________________________________________________________________
Hitachi to buy U.S. software developer GlobalLogic for $9.6B
Author : Element_
Score : 154 points
Date : 2021-03-31 16:10 UTC (6 hours ago)
(HTM) web link (www.reuters.com)
(TXT) w3m dump (www.reuters.com)
| i6ruce wrote:
| Huh, an American company. The majority of the employees of which
| are from eastern Europe or India.
| tootie wrote:
| There's a few of those EPAM is also US-based but has most of
| it's workforce in Belarus and Ukraine.
| madara7890 wrote:
| Nice
| brd wrote:
| I'm not at all surprised to see this. The writing has been on the
| wall that Hitachi has an appetite for getting into enterprise
| software. 5-ish years ago they bought an SAP infrastructure shop
| that I used to work with when I consulted in the space. At the
| time it seemed they were dipping their toes but it felt like only
| a matter of time until they made a bigger push into enterprise
| software services.
| mooreds wrote:
| They also bought Pentaho, an ETL tool, in 2015:
| https://www.hitachivantara.com/en-us/newsroom-hvtv/in-the-pr...
| keypusher wrote:
| They have actually been in this area for quite a while. My
| first real dev job was at HDS after they acquired Archivas back
| in 2007. We built off the Archivas foundation to deliver
| petabyte-scale object storage for big enterprise/govt, kind of
| like selling S3 in a box for companies to put in their
| datacenter. HDS made the hardware and software.
|
| https://www.crunchbase.com/organization/archivas
| simonw wrote:
| Interesting section on their Wikipedia page:
| https://en.wikipedia.org/wiki/GlobalLogic#OpenStreetMap_Foun...
|
| OpenStreetMap Foundation 2018 elections incident
|
| "The OpenStreetMap Membership Working Group released a public
| report [25] alleging that this was an orchestrated, directed
| campaign by GlobalLogic to register in mass their Indian
| subsidiary employees, and suggested an attempt to manipulate the
| election"
|
| The linked report has way more details:
| https://openstreetmap.lu/MWGGlobalLogicReport20181226.pdf
| macintux wrote:
| Fascinating read, thanks. Curious about the two board
| candidates who didn't wish to co-sign the letter recommending
| an investigation.
| petercooper wrote:
| I love stories like this because it tends to result in a "Who??"
| from all over the place and reminds us that, yes, you too can be
| a multi-billion dollar company with very modest mindshare in the
| broader industry.
| missedthecue wrote:
| Same goes for Hitachi... I thought they mainly dealt in heavy
| industry like Caterpillar. They seem to be more of a Samsung.
| AaronM wrote:
| I worked for a Hitachi Factory building raid storage systems
| in Oklahoma in a previous life.
| guitarbill wrote:
| Hitachi used to make chips, hard drive (HGST = Hitachi Global
| Storage Technologies, now owned by WD), and still makes
| optical drives, storage (Hitachi Data Systems, renamed a few
| years ago to Hitachi Vantara). Defo run into Hitachi products
| a few times; maybe I'm showing my age though
| rjsw wrote:
| Hitachi originally made their own design hard drives, I
| have a 100MB ESDI one, more recently they bought IBM's disk
| business before selling the lot to WD.
| missedthecue wrote:
| Yeah come to think of it, I've seen Hitachi hard drives as
| well
| [deleted]
| ChrisArchitect wrote:
| I was going to reply they're into tape storage also but
| then realized that's _Fujifilm_
| pvarangot wrote:
| Hitachi 7200rpm and 5400rpm drives were known to be very
| realiable, by sometimes a factor of 2x in MTBF-like
| metrics.
| quickthrower2 wrote:
| Hitachi were a popular stereo cassette and radio brand back
| in the day not sure if that's still true.
| nolok wrote:
| As a rule of thumb Asian giants tend to deal in everything.
| Especially true for Japanese giants (which is weird, since
| for Japanese companies it's also common to find small giants
| that deal in one thing only and never integrate). Especially
| especially true for Korean giants.
| Tarq0n wrote:
| This is called a zaibatsu in Japan and a chaebol in South
| Korea. The Korean ones in particular are simultaneously
| fascinating and disturbing due to their interwovenness with
| the state.
| TMWNN wrote:
| >This is called a zaibatsu in Japan and a chaebol in
| South Korea. The Korean ones in particular are
| simultaneously fascinating and disturbing due to their
| interwovenness with the state.
|
| The zaibatsu were similarly interwoven with the Japanese
| state through WW2, when the connections were cut during
| the US occupation. While Sony, Toyota, Mitsubishi, et al.
| are very large companies and have the corresponding
| influence any such large company would have in any
| developed country, there is no comparison with the
| dominance of Samsung, Hyundai, and LG of the Korean
| economy and politics.
| kazen44 wrote:
| is there no comparison though? atleast until the last
| late 20th century, many european countries had companies
| which where basically state sponsored enterprises in
| certain regards. (Phillips, Volkswagen, Airbus etc).
| NovemberWhiskey wrote:
| No comparison. Take Mitsubishi. I'm not sure what most
| people think of when they think of Mitsubishi (probably
| econobox cars?). However, if you look at the entire scope
| of the Mitsubishi Group, you get a different idea...
|
| Mitsubishi UFJ is Japan's largest bank and the world's
| second largest bank holding company with ~$2tn of
| deposits.
|
| Mitsubishi Corp is Japan's largest general trading
| company, and includes active business lines covering
| business services, consultancy, infrastructure (airports,
| railways), asset management and finance, energy trading,
| primary extraction of metals and minerals, heavy
| machinery, defense contracts, ships, chemical
| manufacturing and trading, as well as retail.
|
| Mitsubishi Heavy Industries separately manufacturers
| airplanes, air-to-air missiles, helicopters, aerospace
| turbine engines, main battle tanks, nuclear power plants,
| gas turbines generators, LNG carrying ships, cruise
| liners, space craft, wind turbines and desalination
| equipment.
|
| MHI's subsidiaries also include Mitsubishi Chemical
| (which is Japan's largest chemicals company), Nikon
| Corporation (cameras, optics etc), and Mitsubishi Motors.
|
| This is _nothing_ like Philips /Airbus etc.
| agumonkey wrote:
| It's funny because even as obvious as it is .. it's easy to
| forget. I mean a lot of people know Yamaha produces
| motorbikes AND pianos AND hifi devices, yet it doesn't feel
| like a giant.
|
| _memories of my beloved Mitsubishi Diamond Pro 21 " CRT_
| keiferski wrote:
| These are called _keiretsu_ , formerly known as _zaibatsu_
| , popularized in the West via _Neuromancer._
|
| https://en.m.wikipedia.org/wiki/Keiretsu
| DoingIsLearning wrote:
| > Especially especially true for Korean giants.
|
| As supporting evidence... about 10 years ago I was staying
| at a hostel in Seoul, I went to buy a bar of soap at a
| convenience shop. I realized as I was getting ready to
| shower that the soap itself was made by LG!
|
| Probably completely banal for Koreans but to me it was
| equivalent to Tesla manufacturing basketball shoes,
| completely left field.
| DoofusOfDeath wrote:
| Agreed. Hitachi makes a rather famous "muscle relaxer"
| called the Magic Wand.
| Ftuuky wrote:
| From magic wands to self-propelled mortars, Hitachi
| manufactures pretty much anything that has enough market
| demand.
|
| https://en.wikipedia.org/wiki/Hitachi#Products_and_servic
| es
| agumonkey wrote:
| Can't wait for my Makita rugged SSD
| heywire wrote:
| You joke, but they have Makita branded UBB drives lol
| wcfields wrote:
| Love to play my Yamaha trombone on my Yamaha motorcycle
| simlevesque wrote:
| In the same vein, there's Shimano who is the biggest
| brand in biking tech and one of the top five company for
| fishing equipment.
| telesilla wrote:
| Well, spinning discs put to various uses?
| 0_____0 wrote:
| I thought I'd read something about them ceasing
| production due to the odd brand association, but upon
| further research it appears that they're still making it,
| but without Hitachi markings, and distributing through a
| company called Vibratex.
| 91edec wrote:
| Huh... really adds deeper meaning to the motto "If you
| build it, they will come".
| dillondoyle wrote:
| Came to post this. Pun intended. But honestly it's good
| for both uses can confirm. Though the new Theragun style
| tools are a step up for sports therapy.
| TomVDB wrote:
| The Magic Wand is great to relieve the pain when the RSI
| in my shoulder flares up!
| drran wrote:
| Replace your table with something ergonomic.
| TomVDB wrote:
| Ergonomic table with tray, Sculpt keyboard, trackball.
|
| It all does wonders, but it's not always enough.
| flycaliguy wrote:
| Plenty of people saying "who?" because they only know the sex
| toy I suspect.
| spaetzleesser wrote:
| That's pretty common. There are a lot of super successful
| companies that do good business without any mention in the
| media.
|
| I think a lot of SV companies are very dependent on media
| coverage to get their valuation up. Especially since they don't
| have an idea how to make profits.
| ibejoeb wrote:
| Like when SUSE popped up a few weeks ago. It was a collective
| "well huh..."
| dna_polymerase wrote:
| The Silicon Valley rockstars you are talking about are
| usually customer facing, therefore media coverage is of
| interest for a broader mass. GlobalLogic provides services to
| companies, which makes them less commonly known. Meanwhile
| Hitachi is known in a certain niche at best...
| fireattack wrote:
| I honestly think Hitachi is well-known even for average
| people (not for IT division though). Not Sony level for
| sure, but isn't exactly niche.
|
| But maybe it's just my bias too.
| TeMPOraL wrote:
| > _not for IT division though_
|
| The only reason I know that company name is because I
| think they sold hard drives in the past, and/or showed up
| on my BIOS screen. So maybe IT people know it too.
| okl wrote:
| I think so, their name is on a lot of construction
| equipment.
| pySSK wrote:
| They also have the Hitachi Magic Wand vibrator, which is
| commonly known as just Hitachi.
|
| The brand was also known for power tools but that's not a
| part of the company anymore and is being rebranded to
| Metabo.
| bilg21 wrote:
| They used to make good TV's in the 90s too. First color
| TV in our house was Hitachi.
| koreanguy wrote:
| Japanese take from the European patent office and
| American patents. 90% of products coming out of Japan the
| core of the product has origins in the houses of the
| western patent houses.
| MangoCoffee wrote:
| yup. i didn't even know Hitachi is in IT.
| (https://en.wikipedia.org/wiki/Hitachi)
|
| so many Global IT houses like IBM, Avanade...etc. is IT
| outsource/consulting pie so large to feed all these companies?
| dcolkitt wrote:
| I would honestly love to read a write up from somebody closer
| to the source, _what the hell do all these companies do?_
|
| I've been in tech and tech-adjacent companies for over a
| decade. And not once have I or anyone around me ever thought
| "we really need some IBM/Hitachi/Avanade products now".
|
| What value proposition do firms like this actually fill? I'm
| genuinely curious.
| namdnay wrote:
| They're outsourcing firms
| ab_testing wrote:
| I have worked in this space for a long time .
|
| Most of these companies implement COTS software . So if you
| want to implement Oracle, SAP, Salesforce, Service Now ,
| JIRA or other such enterprise software , you will invite
| bids from these consulting companies for implementation,
| support and SLA .
| sethhochberg wrote:
| Tech or tech-adjacent firms tend to be defined that way, at
| least in part, because they do the things these major
| software consultancies and outsourcing firms do on their
| own.
|
| If you're not a tech or tech-adjacent firm, and have a
| nontrivial technology need, you're likely to pick up the
| phone and call someone who specializes in delivering those
| solutions.
|
| Think of it like the difference between Instacart having
| their own software teams and infrastructure to manage
| shoppers and orders, vs the national grocery chain
| Instacart operates within calling IBM for an integrated
| inventory management and point-of-sale system.
|
| There are debates to be had about whether this approach
| yields good results over the long term (specifically for
| the inventory management example, you could point to Amazon
| and to a lesser extent Walmart having such success in part
| because of their internal software efforts). But if you
| aren't prepared to reinvent your grocery stores as a
| friendly frontend for your logistics technology, plenty of
| firms have solutions to sell you.
| keypusher wrote:
| The short answer is that they deliver solutions and
| support. What they sell, primarily, is the ability for
| someone at your company to call them and say "we have
| problem X" and they will respond "no problem, we can solve
| problem X for you", and they will take care of the rest.
| This usually costs millions of dollars.
|
| Let's say you are a large Fortune 500 company. A bank
| perhaps, a large retailer or an oil company. Your net worth
| rivals Amazon. You do not use AWS or GCP, you host your own
| data centers, and you have for decades. Now let's say you
| need another few petabytes of storage with global
| replication, durability, availability, you need hardware
| delivered, fibre cables routed, software to tie it all
| together and someone to call when you run into problems or
| someone on your backend application team can't figure it
| out. Or maybe you need Oracle and SAP integrated with
| Active Directory for your 100,000 employees.
|
| Well, these companies will make that happen. Or many other
| problems you might have, such as building custom
| applications, implementing tooling, designing systems,
| whatever. It's kind of like asking "who employs all these
| personal chefs?! I've been eating for years and I've never
| needed a personal chef. I just go to the store, buy some
| groceries, and make food from the recipes I find online!"
| The thing is that some people just don't want to deal with
| all that, and they have enough money to make it someone
| else's problem who has done it before.
| hunterloftis wrote:
| I spent five years in this space (in a small consultancy
| that was acquired by GlobalLogic last year). I think this
| is how one of our salespeople might describe the process.
|
| The reality tends to be somewhat messier. I especially
| disagree with the "personal chef" analogy. A personal
| chef is an expensive, dedicated, long-term employee -
| much closer to a full time SWE than to a consultancy.
| It's more like hiring a catering company for a wedding.
| tomkat0789 wrote:
| Some nice responses to this, but I'd be interested in
| hearing about the trade off between a big company spinning
| its own IT department vs hiring an IBM et al.
|
| Attached to articles about ERP and government contracts
| failing and going over budget I often see comments like,
| this isn't rocket science I could code something for them.
| Obviously not the right fit for everybody, but is it right
| for some?
| keypusher wrote:
| Hitachi Data Systems has been in IT since 1989, and their
| history in the market goes back in to 60's or 70's. Now
| rebranded Hitachi Vantara, most of their revenue was
| competition was in the same space as EMC (now owned by Dell)
| for enterprise data storage. They are a wholly owned
| subsidiary of Hitachi, which you can think of like GE or
| something, they are in everything. The market for enterprise
| software and hardware is massive and often completely under
| the radar for an audience like HN.
|
| https://en.wikipedia.org/wiki/Hitachi_Data_Systems
| kazen44 wrote:
| > and often completely under the radar for an audience like
| HN.
|
| what else do you think manages the massive amount of
| spinning rust that contains your S3 data? Usually it is
| storage systems like this.
| qaq wrote:
| It's outsourcing company there is a decent number of them. Many
| from small Eastern European countries like EPAM Systems from
| Belarus (Stock: EPAM) Mkt Cap 22.55B. They tend to have HQs in
| US fo obvious reasons though. Surprised there is not much
| invest in this space as you can grow one pretty rapidly to a
| fairly large size.
| 55555 wrote:
| Wow, impressive. Probably not much interest because they
| trade at a low multiple, but that's quite the company. In my
| experience the quality of the experience you get when working
| with a software consultancy/dev shop is inversely correlated
| to the size of the firm. But I guess it works for others.
| azinman2 wrote:
| They probably have enough processes in place and enough
| longevity to be able to get government contracts, big corp
| contracts, etc.
| dopidopHN wrote:
| I work with them on a regular basis. You are correct,
| talented folks. But they get the short end of the stick
| when it come to who does what. Moral is not super high.
| tstrimple wrote:
| I've seen the same pattern as well. Growing dev teams
| quickly without quality drops is difficult. At some point,
| if you're successful enough in that space, your need to
| bring in more bodies outpaces your ability to ensure you've
| got good staff and processes.
| varjag wrote:
| EPAM is there for soon three decades, I dunno about
| "quickly".
| qaq wrote:
| It's way lower risk and if you can grow 50M into billions
| thats pretty much Unicorn level returns
| jan_Inkepa wrote:
| I like that they chose the name "Effective Programming for
| America".
| AlotOfReading wrote:
| Isn't EPAM a consulting company? I didn't think they designed
| their own products to outsource.
| Yizahi wrote:
| This distinction (and naming) is really not strict today,
| especially when total corp headcount exceeds a few
| thousands. One project may be pure software consultancy,
| another may be a a complex solution, yet another can be a
| hardware project inside the big corp (so if it was a
| separate entity it would be called a product company or
| startup). People can be outsourced or outstaffed or
| anything in between.
|
| Basically in a case of 10k outsourcing corp it is pointless
| to think about it as a single entity, it's a collection of
| projects each managed differently, with different expertise
| and different share of in-house development, from original
| products to dumb legacy support.
| ridethebike wrote:
| Disclaimer: former EPAM employee (early 2010-s).
|
| Such big* consulting/outsourcing companies in Eastern
| Europe(epam, globallogic and the like) have competent
| engineers.
|
| I can see it especially clearly after moving to the US and
| having to interview engineers from other big consultancies.
|
| *big - everything with several k employees is considered big
| in Eastern Europe.
| stephenhuey wrote:
| My last full-time job in a corporation involved managing
| many EPAM developers and after working with offshore
| developers on multiple continents I can tell you they were
| the strongest technically that I had encountered. I had
| never heard of EPAM until my boss told me we were bringing
| them on board to help us scale our app dev efforts! We had
| IT consultants from a Big 4 firm who felt more like the
| model of hire undergrads and teach them a few technical
| things to throw jargon around in front of the client. I
| realize in both cases it can be luck of the draw but I feel
| like firms such as EPAM are focused on bringing serious
| technical skills and experience to the table rather than a
| general consultant demeanor.
| jmchuster wrote:
| Big shops will be sending their cheapest (aka youngest)
| consultants to all their small clients, or at least until
| they complain enough about the quality of work that they
| send someone more senior along to right things. That's
| what allows other smaller consultancy shops to compete,
| because such clients would be considered our "big"
| clients that we send our best people to. You're just
| waiting for that moment where they get fed up with a big
| shop and open it up for a new contract, and you can swoop
| in and pick up a new client.
| wil421 wrote:
| The Big 4 consultancies hire college grads give them basic
| training on the big cloud platforms and then fill up
| projects. Otherwise they hire cheap engineers from Eastern
| Europe or India.
|
| They are not looking for experienced engineers. At least in
| the Technology Advisory space.
| raincom wrote:
| That's how these offshoring consulting companies make
| money: for every 7 fresh undergrads, there is one senior
| person. They pay $3500 per annum for these cheaper
| resources; the senior resource gets paid about $16000 per
| annum. Profits for these consulting companies come from
| these $300 per month resources.
| MangoCoffee wrote:
| >The Big 4 consultancies hire college grads give them
| basic training on the big cloud platforms and then fill
| up projects.
|
| that's correct. i went thur that with Avanade. they teach
| us some basic about the security system that they
| implemented for their client and client ask for tech
| support and guess who they send.
| reader_mode wrote:
| > Surprised there is not much invest in this space
|
| There is - huge spike in demand for talent locally in the
| last 5-10 years as this business model started becoming
| popular. Also seeing smaller agencies being acquired by
| larger ones in some decently sized acquisitions recently.
|
| Initially the local IT sector was undeveloped, there were
| quite a few good engineers working in really poor condition,
| the only decent option was relocating to Western Europe.
|
| So there were experienced developers available for cheap,
| and, compared to India, Central/Eastern Europe is closer to
| US (some overlap in work hours), usually a much nicer
| destination to travel to for offshore offices (depending on
| the country, Croatia for example is a really nice tourist
| destination, good English level and the culture should be
| more familiar).
|
| So initially that higher quality talent got absorbed at below
| market rates (especially for US standards) and there were
| quite a few success stories and reputation builders. But now
| as this model expands competition is driving up the price
| locally as well - there just isn't enough people to outsource
| - they are starting to scrape bottom of the barrel talent,
| asses-in-seats, straight out of college Indian code farm
| model with all the problems that had. Also portals like
| toptal made it easier to skip these agencies and work
| directly for clients so now the agencies have to compete with
| that for talent.
|
| I think the peak for this agency model is behind us and I
| think the quality has started to drop (there were a few
| smaller agencies that built their reputation like I described
| above and had great success, they used availability of local
| talent to built respectable teams and getting hired there was
| a resume highlight, sort of like getting hired at FAANG on a
| local level. Nowadays they are hiring people they would
| screen out after an initial call and it's selling asses in
| seats, cashing in on built reputation)
| redisman wrote:
| Same reason that WeWork was magically worth 100x equivalent
| real estate companies because Adam Neumann was so cool and
| quirky.
| diogenescynic wrote:
| "Software developer" is being used very generously here.
| GlobalLogic from what I understood was more of an Infosys or
| outsourcing company.
| ullevaal wrote:
| What distinction are you making? I take your comment as
| pointing at the fact they they are not owners of the software
| when it's done, but developing software for others still makes
| one a software developer, or no?
| iujjkfjdkkdkf wrote:
| A lot of the "system integration" work that these big
| consultancies get hired for is more like configuration (of
| big erp systems like SAP and Oracle or whatever)? There may
| be some overlap but as I understand it's very different from
| what many people would think of when they hear software
| development.
|
| Edit: I think this causes internal confusion as well, like
| consultancies hear "software project" and assume their team
| can do it because they have "software" experience, and then
| you end up with these disasters like you hear about from
| Accenture and Deloitte where they spend 10's of millions of
| dollars building a website that doesn't work. The parallel
| language in a academic, SV type tech, and tech consulting is
| actually a source of a lot of confusion.
| paxys wrote:
| The thing with these consulting companies is they will
| never say no (including for stuff that they are wildly
| unprepared to do). You can hire them for installing
| software on employees' computers, deploying and managing
| some SaaS product, building a healthcare signup website for
| an entire state, building an internal portal, running a
| tech conference, even planning a company picnic (not
| kidding). So trying to define what area they operate in and
| what exact role their employees play is impossible.
| [deleted]
| mk89 wrote:
| FYI, GlobalLogic is not bad at all.
|
| I have worked with both GlobalLogic and InfoSys developers. In
| my experience, they can't be compared: for me globallogic wins.
| However,... they are both freaking huge companies, so you never
| know what you get.
| Taylor_OD wrote:
| The lines between a consulting company and outsourcing company
| don't really exist anymore. Especially at this size.
| oliv__ wrote:
| _> San Jose-based GlobalLogic is currently owned 45% each by
| Canada Pension Plan Investment Board and Swiss investment firm
| Partners Group_
|
| Man, what? What a weird set of owners
| MattGaiser wrote:
| Canada Pension Plan is the equivalent of Social Security in the
| USA, except that it invests.
|
| They own all sorts of stuff all over the world. Bridges.
| Airports. Hotels.
| whalesalad wrote:
| Norway does something similar afaik and are sitting on a
| pretty wicked pile of cash.
| bidirectional wrote:
| Why is it weird?
| vco3340 wrote:
| Extremely common for mature companies to be backed by private
| equity and pension funds
| pottertheotter wrote:
| They are actually pretty normal, but I guess not well known
| outside of the investment world. These are two of the largest
| groups making private equity investments.
|
| Partners Group is a very large investment management firm with
| $109bn assets under management (AUM), of which 48% is in
| private equity. It is pretty common for pension plans to invest
| in private equity firms, but the larger ones also make direct
| investments, usually alongside a large PE firm such as Partners
| Group.
|
| CPP Investments, the entity that manages all of the assets of
| the Canada Pension Plan, has US$378bn AUM. ~25% of that, $90bn,
| is in private equity. Some of their direct investments, which
| you can see on their website[1], are Blackhawk Networks, Jimmy
| John's, Neiman Marcus, Petco, Qlik, SUSE, and Waymo. They also
| have investments in VC firms, such as A16Z, Sequoia Capital,
| and even Y Combinator.
|
| [1] https://www.cppinvestments.com/the-fund/our-
| investments/inve...
| sdwvit wrote:
| Used to work for GL, they treat employees well.
| spaetzleesser wrote:
| This could just be a product of the specific people I have dealt
| with but I have had the (dis)pleasure of dealing with quite a few
| outsourcing companies and GlobalLogic so far has been the only
| one where I felt the relationship is productive and we are
| getting good people.
___________________________________________________________________
(page generated 2021-03-31 23:00 UTC)