Last week, Microsoft (MSFT Quick QuoteMSFT - Free Report) signed a deal with Xiaomi to get its software on its tablets; Salesforce (CRM Quick QuoteCRM - Free Report) acquired Demandware; and Intel (INTC Quick QuoteINTC - Free Report) , NVIDIA (NVDA Quick QuoteNVDA - Free Report) , Advanced Micro Devices (AMD Quick QuoteAMD - Free Report) and others made a strong showing at Computex.

Here are the top stories-

Microsoft, Xiaomi Have A Deal

Xiaomi, which has previously offered a Windows 10 option on its Mi Pad 2 tablet and even played with after-market Windows 10 conversions of its Mi 4 smartphone, is now getting in deeper with Microsoft. The company has acquired 1,500 Microsoft patents covering voice communications, multimedia and cloud computing that should enable it to make a splash in Western markets. With the low end of the Chinese smartphone market getting crowded, Xiaomi needs to expand rapidly in international markets to stem declining sales.

For Microsoft, this is an opportunity to build its ecosystem, since it has gotten Xiaomi to pre-install Microsoft Word, Excel, PowerPoint, Outlook, and Skype applications on its Mi 5, Mi Max, Mi 4s, Redmi Note 3 and Redmi 3. The deal didn’t mention if Microsoft is charging or waiving its Android patents, but this could be additional revenue opportunity. So even as it dismantles its own smartphone business, Microsoft is able to grow its ecosystem through hardware provided by other emerging companies.

Powered by Microsoft IP through both acquisition and licensing, Xiaomi has a fighting chance of challenging Apple in its traditional markets. But it does look like the Chinese company’s costs jump come September when its new devices start shipping.

Salesforce Acquires Demandware

The convergence of advertising and sales in the digital world is also leading to more robust software platforms to support such operations. Just as SAP and Oracle have been building capabilities in the area, Salesforce, which has traditionally focused on customer relationship software, is also moving to add capabilities in sales.

This is what led to its $2.8 billion acquisition of ecommerce tools provider Demandware. The acquisition, which is expected to close in July, will give Salesforce access to digital commerce platforms, spending on which will grow 14% a year up to 2020, according to Gartner. Post-acquisition, Demandware will operate as a new business division called the Salesforce Commerce Cloud.

Computex

The annual hardware show based out of Taipei was stashed with surprises this year. Companies announced chips, computers, VR tech and there was also a rather sweet-looking robot.

Chips: Intel, AMD and NVIDIA had announcements, as did chip designer ARM Holdings. Intel didn’t provide any update on Kaby Lake other than telling us that it will ship this year (the chip is probably getting ready to enter production as we speak after sampling with PC makers). Intel’s important announcement was instead to do with the $1,723 Broadwell E for enthusiasts with Core i7-6950X, 10 CPU cores, per-core overclocking, Turbo Boost Max 3.0 technology and compatibility with Haswell-E motherboards.

AMD’s response was the 8-core, 16-thread Zen, which claims 40% increase in performance speeds and will ship by year-end.  It also showed off two new APU lines called Bristol Ridge and Stoney Ridge for laptops that could put Intel silicon to test. AMD’s first 14nm FinFET technology chip is very competitively priced in the Radeon RX 480, potentially lowering BOM for VR headsets. NVIDIA’s GTX 1070 is a graphics card with a difference. And Samsung’s PM971-NVMe is an SSD with 512 GB NAND, a controller and a RAM.

PCs: In this lot, there was the Digital Storm Aura that is a 34-inch all-in-one with the all-new GTX 1080 graphics card and Intel Broadwell E. The backpack gaming PC from MSI with the NVIDIA GTX 980 graphics card was quite sensational. HP Omen X was announced as being made along the same lines but wasn’t showcased. Asus announced one in the do-it-yourself category called Avalon and another water-cooled gaming PC. Dell announced two Windows-based Inspiron hybrids with the $250 version having a Chromebook-like focus on the Internet and the $530 version doing the same thing but in more style.

VR/AR: Microsoft added a couple of updates to its AR headset so it works with traditional 2D apps and a split-screen feature that allows you to see three screens. It also said that it was opening up the Holographic OS to hardware partners. This should allow the company to grow share in the space.

Robot: The ASUS ZenBo has a touch-screen face but the rolling, talking companion can also take vocal orders to recite stuff, read books to your kids or elderly parents, turn on and off lights, TV, music and so forth. At $599, it doesn’t come cheap.

Other stories you might have missed-

Corporate

Apple Back-to-School Promo: Beginning last Thursday, Apple (AAPL Quick QuoteAAPL - Free Report) is offering students or their parents $300 Beats Solo2 wireless headphones free with the purchase of a Mac laptop or desktop from Apple (refurbished and Mac minis not included).

Apple to Sell Bonds in Taiwan: Apple is raising a billion dollars from Taiwan through 30-year bonds.

Facebook Makes a Succession Plan: Facebook’s board of directors is looking to cease Zuckerberg’s majority voting control in the event that he quits his management role at the company. The board is also seeking that in the case of such an eventuality, the CEO should also not be allowed to transfer his Class B shares. There is also the question of inheritance of these shares and chances are the board will see that they be transferable to a descendent upon his death either.  

Tony Fadell Leaves Alphabet’s Nest: Tony Fadell, who created the iPod, worked on three iterations of the iPhone, then left Apple to found his own company called Nest before selling it off to Google a couple of years back, is now leaving the company  to do other things. These could include time spent on some of the startups that he funds, including Phononic, Mousera and Impossible Foods or the new electric go-kart company Actev Motors he founded recently. Marwan Farwaz, who was earlier CTO of cable company Charter and Motorola Home is taking over as CEO. Fadell remains advisor to Google parent Alphabet.

Uber Raises $3.5 Billion from Saudi Fund: Saudi Arabia’s sovereign wealth fund has injected $3.5 billion at a valuation of $62.5 billion into Uber with managing director Yasir Al Rumayyan acquiring a seat on Uber’s board. Just last month, Apple invested a billion dollars into Chinese company Didi Chuxing as the ride-sharing business gathers momentum. All this could tie in with self-driving car initiatives since most of the ride-sharing companies are also dappling in that technology.

Google Sells Lenovo Stock: Google is backing out of its Lenovo investments and is reportedly looking for anywhere between $218-221 million for 371 million Lenovo shares, a slight discount to the last-traded price.  

Softbank Sells Alibaba Shares: As a result of its financial problems and the losses at Sprint, Softback offloaded some Alibaba shares last week. The total value of the shares sold was $8.9 billion, of which Alibaba bought back $2 billion worth and $5.5 billion was sold through an instrument that would convert into Alibaba shares in three years. Alibaba Partnership comprising Alibaba’s managing executives bought $400 million worth of shares, with GIC Private Limited and Aranda Investments (a wholly owned subsidiary of the state-owned investment company Temasek Holdings in Singapore) bought $500 million worth each.

Legal/Regulatory

HPE and Oracle Head to Court: Pre-split Hewlett-Packard won a case against Oracle in which Oracle unilaterally and arbitrarily stopped supporting HP’s high-end Itanium servers. HP claimed and the judge accepted that this followed Oracle’s purchase of Sun Microsystems, which brought a ton of hardware to Oracle, thus making the formers partners competitors. Oracle’s action violated their previous agreement. Oracle’s argument that it feared Intel would discontinue Itanium chips didn’t hold water especially because Intel denied it. The current innings is to determine damages and HPE (which inherited the case post-split) reportedly intends to ask for $3 billion.

New Technology/Products

Facebook Using AI in Search: After Google announced that it was using AI to generate search results, Facebook too has jumped on the bandwagon. The idea seems to be to decipher, organize, tag and produce for us all the data generated by interactions on its platform. The thing to remember here is, this isn’t all the data that’s out there on the web, but just the section that’s available on Facebook. So while it may be more personal (because it’s from your contacts), it may not always be relevant, useful or informative. Just as long as you know what’s on offer, you will be fine.

Baidu Driverless Cars: Baidu VP has confirmed that the company will half self driving cars in mass production by 2021. Last year, it said it was testing the cars in China and it has since expressed a desire to test in the U.S. as well. The technology is far from perfect at this stage and that’s not the only hurdle facing these companies. They also have to work out the legalities of the matter given that driverless cars can cause accidents on account of its own shortcomings or those of drivers in other cars that aren’t so automated. But Baidu’s agreements with Chinese companies to manufacture the cars and the Chinese government’s determination to compete with U.S. counterparts could see its dreams fulfilled. At any rate, we should expect strong Chinese competition for self-driving cars whenever Apple and Google get ready with their self driving cars.

Alibaba into Connected Cars Now: Chinese company SAIC Motors will be using Alibaba’s Yun OS in its cars and from the sound of it, this promises to be a close relationship. SAIC’s financial controller Gu Feng said, “We worked with Alibaba instead of Google or Apple because the latter looks at the car as a piece of hardware to install their software. If they are successful, in future they may just get a Ford or GM to produce cars for them, so we don’t see as much synergy in working with them.“ The first car with the Yun OS will be a sports utility vehicle.

M&A

Cisco-IBM on IoT: The two companies are combining their technologies to help customers gain insights from data at the edge of the network. This may be expected to gain importance as the number of devices connecting to a company’s servers (or the cloud) may increase exponentially with the advent of IoT and corresponding pressures on the network. With IBM’s Watson and business analytics software running on Cisco's connected streaming analytics gear, companies will gain insights into data even in these bandwidth constrained environments.

Some Numbers

IDC Slashes Smartphone Estimates: According to the IDC Quarterly Smartphone Tracker, smartphones will grow a mere 3.1% this year compared to 10.5% in 2015 and 27.8% in 2014. The earlier projection was for 5.7% growth this year. Phones based on Android, iOS, Windows Phone and others are expected to grow 6.0%, 2.9%, -25.3% and -43.1% from 2016 to 2020, according to the research firm.

Minecraft Crosses 100 Million Units: Mojang, the game developer that Microsoft acquired in the fall of 2014 for $2.5 billion has reaped rich dividends for the company. At the time of acquisition its star performer Minecraft had sold 50 million copies and with barely two years gone since the acquisition, that total number stands at 106 million, according to both Mojang and Microsoft.

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