CA Technologies sees partnerships, acquisitions key to global growth

 Choe says company may consider establishing R&D center domestically


Korea’s software industry may have been in the shadows for quite some time.

But Michael Choe, president of CA Technologies Korea, the local subsidiary of the world’s biggest IT management software company, said that with the emergence of cloud computing technology, it will stand at the forefront of innovation.

“Software had been a ‘necessary evil’ in the past (in Korea), but now it has become a more integral part of the drive for speed and innovation in the business,” Michael Choe told The Korea Herald.

He added that the industry still faces challenges in keeping pace with the fast-changing technology landscape, but he sees Korea, driven by cloud and consumerization of IT, making the transition from its old IT paradigm of being highly labor centric.

As CA Technologies has also made its third transition by becoming the solution provider for cloud computing, it is eager to boost partnerships with local system integrators such as Samsung SDS and LG CNS. The NASDAQ-listed company started out as a software provider for mainframes, and with the Internet boom, it extended to distributed computing, Choe noted.

“Now, it’s cloud computing and virtualized servers,” he said, adding that enterprises are seeking to manage their datacenters faster with optimal efficiency and security.

CA Technologies seeks to extend its partnerships with Korean tech firms that seek growth outside of Korea in this field.

“CA can be their partners for global growth,” Choe said, noting that its CEO Bill McCracken recently met with CEOs of Samsung SDS and LG CNS to further talk about strategic partnerships both globally and domestically.

“Building our partner eco-systems will help us cover the market,” he added.

Korea, along with China, is CA’s main growth market in Asia, Choe said.

Choe, who has been with the company for seven years, said one of his objectives is to make CA Technologies Korea equal to the current global status of being the world’s biggest in IT management software.

In this regard, the No. 1 IT management software developer would consider establishing a research and development center in Korea.

“It’s something that we talk about. But we don’t have a plan for it right now. Bringing R&D to the local market is advantageous. So I wouldn’t rule it out,” he said.

Acquisitions in Asia, including in Korea, could also be considered for CA Technologies, which screens a list of some 100 companies worldwide annually for potential buys.

Although the company has mostly sought acquisitions of venture start-ups in Silicon Valley in the U.S., Choe said of the 100 possible targets, many of them are also in Asia.

“Innovation is happening in Asia. Korea has a lot of innovative tech start-ups as well,” Choe noted.

“Given the dynamics in Asia, in the next few years, GDP in Asia Pacific will be larger than that of the U.S. The market is here now. There’s enough population buying power in Asia. This will drive innovation here.”

This is part of its “build and buy” strategy, which includes investing $500 million in R&D a year.

The company reviews its existing portfolio and sees whether it can improve it by filling in the gap via innovation, while at the same time seeing whether it can get to its goal faster via acquisitions.

“That is continuing to be our strategy. If you want to maintain the No. 1 position, you can’t stand still,” he said.

Some of CA Technologies’ acquisitions include Arcot Systems, a cloud-based fraud prevention solutions firm, and 3Tera’s AppLogic, a cloud services company, he noted.

The company, established in 1976, had sales of some $1.3 billion in the third quarter of fiscal 2012 ending Dec. 31, up 10 percent from $1.1 billion a year ago, according to financial statements.

By Park Hyong-ki (hkp@heraldcorp.com)