TECH ROUNDUP: Google expands in Oregon; Intel cancels talks to buy Altera, braces for slipping PC sales.
BY JACOB PALMER | DIGITAL NEWS EDITOR
Google is nearly doubling the size of its presence in The Dalles with a new $600 million facility opening today.
The company has a history in the Columbia River Gorge town, OregonLive.com reports.
The Dalles was home to Google’s first big custom data center, which opened in 2006. Data centers have since become a core part of the company’s business, housing all manner of online data including Gmail, Google Drive and YouTube videos. Google now has data centers all over the country and around the world.
Google, like other big data-center operators including Amazon, Apple and Facebook, was drawn to Oregon by relatively cheap power and an extremely favorable tax climate. The state has no sales tax to levy on the hundreds of millions of dollars worth of computers that runs its data centers. And special enterprise zone tax deals exempt those computers from local property taxes too, saving Google millions of dollars annually (the size of the savings will depend on how much Google spends to equip the facility).
Data centers don’t offer great gains in employment, but they do boost revenue for the city.
It paid the city, Wasco County and the local school district $1.2 million in 2013 when it won the tax deal for the new facility, Associated Press reports.
Intel cancels talks to buy Altera; braces for slipping PC sales
Intel and Altera have called off their proposed acquisition.
Altera’s stock dropped after the news of a canceled transaction emerged, OregonLive.com reports.
CNBC reported that Intel had offered more than $50 a share for Altera – the stock was trading below $35 a share before word of a potential deal got out last month. Bloomberg reported that Intel had offered $54 a share. Altera apparently found that insufficient, but investment analysts said they don’t consider the issue settled.
“Despite an inability to come to a deal, we still see a possibility of a combination at a later date,” wrote S&P Capital IQ analyst Angelo Zino.
At that rate, Intel would have had to pay about $15 billion to buy Altera.
Personal computer sales continued to slip in the first quarter of 2015, a bad sign for Intel.
OregonLive.com writes:
“The PC industry received a boost in 2014 as many companies replaced their PCs due to the end of Windows XP support, but that replacement cycle faded in the first quarter of 2015,” Mikako Kitagawa, principal analyst at Gartner, said in a written statement.
The first-quarter tally is no surprise: Intel slashed its quarterly outlook by nearly $1 billion last month, blaming poor PC sales to small and midsized businesses. Intel reports its first-quarter results Tuesday and will provide investors with a new forecast for the rest of the year, adjusted downward to account for the disappointing PC market.
Intel is “racing to diversify its business in anticipation of continued troubles for the PC market,” Mike Rogoway reports.
