The minute that Dell and EMC announced that the former was buying the latter, the countdown was on for various Boston-based news outlets to lament the purchase of the area’s last home-based tech giant by an outsider. Perhaps worse, an outsider from Texas which many see as the polar opposite of the northeastern liberal redoubt that is Massachusetts.
Over the past decades, local tech watchers have worried over the steady erosion of home-grown tech giants, typically through acquisition long after they peaked.
But EMC (EMC) is seen as the final straw. EMC co-founder Roger Marino termed Dell’s planned $67 billion purchase of EMC the bittersweet “end of an era for Massachusetts,” according to The Boston Herald.
But that “end-of-an-era talk” has been going on at least since the sunset of the minicomputer era of the late 1980s when Route 128 -based companies like Prime, Computervision, Data General, Digital Equipment Corp., and Apollo. Most of those vendors were bought up by larger, out-of-state companies as part of consolidation long ago. Hewlett-Packard (HPQ) (Palo Alto, Calif.) Bought Apollo. Compaq (Houston) bought Digital and the combined company was bought by HP. You see the pattern.
More recently, IBM (IBM) (Armonk, N.Y.) Swooped in to buy Lotus Development Corp. In 1995, and since then has acquired more than 20 other Boston area companies including Netezza, QI Labs, Unica, and Cloudant. Oracle (ORCL) (Redwood Shores, Calif.) Has also snapped up Art Technology Group, Endeca, and Phase Forward.
Local venture capitalists still worry about the fact that two of tech’s biggest-ever founders—Microsoft (MSFT) co-founder Bill Gates and Facebook (FB) co-founder Mark Zuckerberg—left Harvard (before graduation no less) and moved west to start their companies.
All of this leaves many locals feeling that the Boston-Cambridge nexus, with its elite universities, has become the farm team for Silicon Valley and other distant tech centers, now including Round Rock, Texas where Dell is based.
Now there’s near paranoia about tech flight out of Massachusetts, with players keeping a watchful eye on remaining local powers, like Cambridge-based Akamai (AKAM), watching for signs of change.
The usual story is that companies cannot get the necessary funding in Massachusetts and so gravitate to Silicon Valley, the hot bed of venture capital. Or that techies seek techies and there are simpy more techies there. That the weather here stinks. All of this prompts a spate of articles, including one by yours truly, about what Boston needs to do to keep talent local.
But back to EMC. On a conference call Monday, EMC executives tried to reassure a local reporter, who seemed nearly hysterical, that there were no plans to close the company’s Hopkinton, Mass. Headquarters. Instead, the merged entity’s hardware business will remain based there.
Later, David Goulden, president of EMC’s information infrastructure or storage business, told The Boston Globe that Hopkinton will be “the headquarters of a major, $30 billion-plus business, which is growing…We are committed to over time making sure that we grow our head count in Massachusetts.”
Still, we’ve heard those words before. Many in the area now feel it’s well past time to focus on biotech and life sciences where area powerhouses like MIT, Harvard, The Broad Institute, and others have formed a hot bed of their own.
For more on the Dell-EMC deal, check out the video.
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