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Dell makes EMC offer, VMWare stumbles … 5 things to know today

1. Dell has agreed to buy EMC in what could be the biggest tech takeover in history. The size of the buyout will depend on the value of EMC’s interest in VMWare, but Dell and EMC estimate that the deal will be worth $67 billion. Dell, which went private two years ago in a $25 billion deal, will need to return to the debt markets to finance this deal.

EMC is a provider of cloud computing and data storage solutions, while Dell is a maker of servers and personal computers. Dell Founder Michael Dell said the combined companies will be well positioned to serve enterprise customers in six key areas: digital transformation, software-defined data centers, converged infrastructure, hybrid cloud, mobile and security.

Roughly half of EMC’s market value is tied to its stake in VMWare, a Silicon Valley company that makes software designed to enable multiple operating systems and applications to share one physical server. VMWare will continue to operate as an independent, publicly traded company.

2. VMWare shares are down more than 10% this morning as investors evaluate the Dell deal. In addition, CRN reports Apple may be abandoning VMWare in favor of an open-source solution that has support from IBM. Apple and IBM inked a deal last year to market Apple products to IBM’s enterprise customers.

3. Twitter is expected to cut jobs now that co-founder Jack Dorsey has returned to the CEO position. The social media giant currently employs roughly 4,100 people, and about half of those people are engineers. Twitter has been growing, but investors do not view the business as favorably as they view Facebook.

4. Verizon Wireless has new prepaid data plans for connected devices. The nation’s largest wireless carrier is selling data by the week and by the month, with prices ranging from $15 per week for 500 megabytes to $50 per month for 5 gigabytes. In order to get 5 GB for $50 per month, customers need to prepay for 2 months at a time.

5. AT&T’s new Wi-Fi calling is not working for some users who use an AT&T SIM card in an unlocked T-Mobile US iPhone 6s. Switching hardware apparently blocks the user’s access to AT&T’s voice over LTE and voice over Wi-Fi. Apple is also selling unlocked versions of the iPhone 6s, but so far there are no reports of AT&T services not working on those phones.

ABOUT AUTHOR

Martha DeGrasse
Martha DeGrassehttp://www.nbreports.com
Martha DeGrasse is the publisher of Network Builder Reports (nbreports.com). At RCR, Martha authored more than 20 in-depth feature reports and more than 2,400 news articles. She also created the Mobile Minute and the 5 Things to Know Today series. Prior to joining RCR Wireless News, Martha produced business and technology news for CNN and Dow Jones in New York and managed the online editorial group at Hoover’s Online before taking a number of years off to be at home when her children were young. Martha is the board president of Austin's Trinity Center and is a member of the Women's Wireless Leadership Forum.