The Great NCR Schism

January 10, 2006: NCR Corporation has announced a separation from data warehousing spin-off Teradata, in a move that will create two publicly traded companies.

The schism will allow NCR to pull the focus in on their core customers and concentrate on their banking equipment and retail checkout system sales market. Meanwhile Teradata will continue to operate as an enterprise data warehousing vendor.

NCR says the tax-free sell-off should be completed within six to nine months.

The fact that the Teradata and NCR have little in common means the two share a minimal customer base, possibly making it difficult for NCR to cross-sell their vastly different product offerings. “Teradata and the new NCR operate in different markets, each with solid prospects for the future,” Chief Executive Bill Nuti said in his statement regarding the split. “But they have markedly different business models.”

Mike Koehler will become the CEO and president of the new independent Teradata, a role he should be familiar with given his current position as the senior vice president of the soon to be redundant Teradata Division. Nuti will serve as CEO of the new look NCR.

Mike Davis, Senior Analyst at Ovum believes the move will assist in allowing both organisations to generate new business. “This is a logical step that will enable the two companies to better focus on their respective product strengths and which will be good for end-user organisations,” he says. “The split will leave the rest of NCR to focus on the financial self-service and retail store automation markets.”

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