Featured Article 20 Jun 2013

JJ Worrall
The Irish Times
June 20th 2013

EMC president David Goulden talks about tax, data protection post-Prism and rumours of an impending promotion

“How big a factor is tax?” David Goulden ponders aloud. “It’s a factor but not the primary one.” The EMC president and chief operating officer is talking to The Irish Times about why the company continues to invest in Ireland.

Goulden is visiting the company’s offices in Ovens, Co Cork, less than 20km away from Apple’s Hollyhill Industrial Estate base, the centre of recent controversies over multinational subsidiaries paying little or no tax on their profits.

He is at pains to say that EMC is “fully tax compliant”. “We pay taxes in all countries in which we operate,” he says. “We have a clear presence and, in almost every case, we are invoicing locally and therefore paying taxes locally.”

Also paying taxes locally are the 3,000-plus people the company employs here, spread between offices in Cork, Dublin and Belfast. Goulden maintains that Ireland’s low corporation tax rate isn’t even among the top “two or three” factors that sway decisions like last week’s announcement that EMC would be creating an extra 200 jobs in Cork alongside building new offices in Mahon.

Instead, he claims the main concerns at boardroom level are “the access to workforce skills or how well is a team going to come together and produce results for the business”.

Certainly EMC’s relationship with Ireland is considerable, having been in Ovens for 25 years, while other arms of its business – such as virtualisation innovators VMware and IT security company RSA – also have a presence here.

With a stated skills gap for high-end technology positions in Ireland (currently there are around 4,000 technology-focused positions unfilled), is he not worried that that the firm may struggle to maintain that “access to the workforce skills” in years to come?

“I think there’s a global skills gap in technology,” he says. “It’s not just in Ireland.”

However, he believes the way it is being tackled here is more progressive than in other countries, pointing to the company’s recent partnership with UCC to create both master’s and diploma courses in “data business” as evidence.

“Quite honestly, I don’t think we’ve anywhere else in the world where specifically we’ve got the masters or the diploma in big data,” says Goulden. “We have a university outreach programme in other countries but nothing quite as focused as we have here, right now.”

The 52 year-old says Ireland is aligned with EMC’s three-pronged business strategy – “cloud, big data and trusted IT”. He raised a few eyebrows at the press conference announcing the 200 new roles by saying that the Government’s Action Plan for Jobs “and the EMC strategy look like they were almost written by the same person, they’re that close”.

Goulden himself has been working in the IT industry for 32 years, with the last 11 in EMC. He says he feels most at home when “getting involved with technology and product plans”, and his arrival at the company no doubt had something to do with current chief executive Joe Tucci, who worked with Goulden at IT service providers Wang Global, Getronics and Unisys during the late 1980s and throughout the 1990s.

Tucci arrived at EMC in January 2001, with the business suffering revenue woes in the wake of the spectacular bursting of the Dotcom Bubble. By the time Goulden joined the firm 18 months later, Tucci had begun to steer the company back into profitability, heading off rumours of possible takeovers.

Working relationship
Instead of being consumed by a rival, EMC went on spending spree – putting more than €10.5 billion into strategic acquisitions since 2003.

The most notable – but certainly not the most expensive – takeover during that time was its buy-out of VMware in 2004 for a little over €475 million. It was an acquisition that Goulden led and the VMware deal has helped the company rake in billions of euro in profits ever since.

Reporting directly to Tucci, Goulden says they work well together. “If you’ve worked together for 20 years and you haven’t got a good working relationship that’s a problem.”

There have been rumours that the Englishman may become company chief executive whenever it comes time for Tucci to step down. Having only become company president and COO last July, Goulden laughs off the idea that he might start sizing up Tucci’s office in EMC’s Massachusetts HQ for refurbishment.

“Joe has stated that his current intentions are to stay in the CEO role through or close to the end of next year, and by early 2015 he would transition into more of an executive chairman role. He said that he fully expects that his successor will come from inside the company, but that doesn’t mean it’s definitely me,” says Goulden.

Should he take over, he will be at the helm of an organisation that has 50,000-plus employees worldwide, double-digit revenue growth for the last three years and first-quarter revenue of $5.39 billion this year.

The opening quarter of 2013 also saw its VMware arm increasing virtualisation and cloud infrastructure revenue by 13 per cent compared to the same period last year. With the cornerstone of cloud being storage and transfer of data online, Goulden admits that recent revelations of data security related to the NSA/Prism scandal could cause reputational damage to cloud providers, whether they’re associated with the story or not.

National security
“Trust in the cloud or trusted IT is a huge agenda item for customers,” he admits, adding later that from EMC’s point of view Prism is “not something that we as the IT industry need to be commenting upon”.

Instead, he feels it’s “something that the [US] government needs to decide what position it wants to take relative to actions it takes to defend national security”.

According to Goulden: “If people are looking at information for national security reasons they’re doing it for reasons they think are decent. Who are we to second guess that? I don’t worry about that. I think the bigger concern [is] in the whole area of cloud and trust and security – keeping people you don’t want to read your information out. Right?”

Content supplied with the permission of The Irish Times Ltd.
For more see www.irishtimes.com

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