Monday, January 5, 2009

IT companies that are too big to fail?

This NY Times editorial over the weekend got me to thinking: The End of the Financial World as We Know It . What happens when we come to the end of the IT world as we know it? It's going to happen someday.

This whole problem of being too big to fail is of interest. Don't we have the same problem in IT? With Microsoft being rumored to being close to laying off 17% of its workforce I started to think of what a catastrophe it would be for them to fail. What if Cisco were to fail? Throw Oracle into the mix?

Now I don't think for a minute that this is possible, but we've seen stranger things of late. With 90% of U.S. business running MS software, the tubes dependent on Cisco, and the data buried in Oracle, can you imagine the crisis that their failure would precipitate? My guess is that we would be seeing a bailout. They're too big to fail. I'm thinking that the government made a mistake not breaking-up MS when it had the chance.

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