Abbott Labs to Split Into Two – The Wall Street Journal.

I thought you would be interested in the following story on WSJ.com.

Abbott Labs to Split Into Two

http://online.wsj.com/article/SB10001424052970204485304576640740820288766.html

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From iPod. Pls excuse brevity.

Management styles in China

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Privatization in China ECON0911.pdf

COMMENT: To Integrate or Not – that is the IT question

In one week, The Economist argued two sides of a coin (not uncommon for economists…), admittedly using two industries as evidence:

• In IT and computers, they see good reason for leading companies to move “up the stack” and divest commodities like PCs in favor of software and services. Classic case: IBM. Current case: HP. See Seismic shift in Silicon Valley.
• In another article, they saw good reason for Google to get into handset hardware by buying Motorola, even if those are commodities. The reason they cite is that this industry might not play out like PCs. And, in relaying the argument, they make a point about Google using the hardware position to further its software growth of Android and related services. See Patently Different.

The key difference between these examples and industries is the stage of maturity of the technology and competitive landscape. In PCs, the value chain has stopped evolving and the software standards are more or less stable – hence little role for owning integrated hardware and software. In smartphones this is not so yet, but getting there fast.

Frankly, the least mature field is tablets/pads: watch for Google to move into THAT direction with its new Motorola hardware knowledge. If it doesn’t go in that direction, it is more likely to spin off the Moto handset in short order, much like HP and IBM did with their mature hardware businesses.

NEWS: ITT Breakup — WSJ

ITT has a long history of acquisitions and spin-offs, as one of the original “conglomerates” in American business. The latest spin-offs are described in this article.
ITT Breakup Jan2011 WSJ.pdf