IBM to sell its PC and ThinkPad business

[Asher]

Originally posted by Agathon

The PC has become so commoditized that it's not worth the investment.

Yeah right. That's just loser talk from companies who can't be bothered to give people a reason to buy their products.

Let's face it, Agathon...IBM is a far more successful business than Apple is and ever will be, and you're suggesting IBM stop what is proving to be wildly successful for them and do something like Apple, whose marketshare continues to dip.

Apple themselves are concentrating on different segments now.

IBM has spent tens of billions of dollars in a couple years aquiring over 20 software and services firms in markets which are marked for explosive growth.

That is a far smarter move than trying to enter the home computer market -- a market that IS heavily commoditized with grim growth expectations.

I'd trust Palmisano's judgement of this better than yours. He's been with IBM since 1973 and has seen it all. He has a far better understanding of how the market works, of how businesses work, and of where the market is going.

Calling them idiots with your ridiculous insights and suggestions is just simply hilarious.

IBM are idiots. They should have spun off the thinkpad business. A lot of people love those machines.

I agree the ThinkPad business is very valuable -- they're widely regarded by reviewers, analysts, and users as the most reliable and most secure laptops, by far.

We have to remember that these initial reports lack details. All we know is they're talking to a couple firms for selling the "PC" business, and everyone is just assuming this includes the ThinkPads.

[Asher]

Originally posted by Agathon
Yep.

I love this "solutions" crap. More marketing gobbledigook....

If IBM had any balls at all, they'd be trying to add value to their PC products so as to give people a reason to buy them.

It's so amazing that you don't understand anything about the PC market.

IBM doesn't want to be a volume PC dealer, IBM doesn't need to be a volume PC dealer. It's not their business.

And I realize you think the "solutions" stuff is marketing BS. But that's because you're not a business.

What IBM does now for its main business is this: A customer comes to IBM and presents a problem ("We need to do this"). IBM devises a solution for them, usually with IBM products (surprisingly, not always -- I deal with IBM/Oracle configs all the time, for example), and implements it.

The customer doesn't usually come to IBM looking for four network switches, three computational clusters, with 150 Pentium 4 PCs.

They come to IBM with what they want in the end, or a "problem", and IBM delivers a mix of products and services as a solution. It's even gone so far as IBM regularly working with, say, a huge bank. IBM simply takes over their entire IT infrastructure under contract for X many years, and the bank doesn't need to worry about it anymore. Several of the major banks in Canada now don't employ a single IT worker or own a single computer -- IBM provides them all and handles it all.

It's not just marketing BS, in the business world (which is a far bigger market than you think it is), it's how IBM is being as successful as it is.

[Asher]

Additionally, it looks like the $100M profit recently was a "fluke"...

http://www.thejournalnews.com/newsroom/010902/09ibm.html

For several years, analysts and investors have speculated about the fate of IBM's PC division as it struggled to cut losses. IBM's PC group lost $992 million in 1998, $557 million in 1999, $148 million in 2000 and $136 million in the first three quarters of 2001.

Starting to sound like a more sound decision by the day.

[Agathon]

I'd trust Palmisano's judgement of this better than yours. He's been with IBM since 1973 and has seen it all.

Considering some of the decisions that have been made by IBM in the past, this does not figure in his favour.

[Asher]

What decisions has he made that have proven bad?

[Fve Crathva]

Originally posted by Asher IBM gets its money through RFPs (Request for Proposals) and other related documents.

I remember one of my profs who used to work at IBM telling us a story about a team at IBM writing up an RFP that had a deadline of 10:00 the next Monday. They worked on it all day over the weekend, finally finished it, and ran it over to the customer. They got to the contact's office 30 seconds late, the door was locked, and the guy inside just smiled at them, waved, and started reading the top proposal from the stack on his desk.

Not that that has anything to do with the thread. And the professor told it better. Man, I suck.

SP

[Ted Striker]

You suck Fve!

[Asher]

See Agathon, the corporate market is bigger than you think, and far more lucrative than the home market.

http://news.com.com/Lloyds+to+spend+nearly+1+billion+on+broadband/2100-1034_3-5479340.html?tag=nefd.top

Lloyds signs $1B contract with IBM.

[Atahualpa]

Oh yeah, Aggie and Asher you can try to find a peaceful living. Apple and IBM are going to merge:

By Cormac O'Reilly
Published Monday 6th December 2004 11:32 GMT

Opinion. As the IT world digests the fact that IBM has, according to the New York Times, put its PC division up for sale, another set of speculation revs up.

No, not the fact that the rumored potential buyer is Chinese company Lenovo, nor the cruel related joke that many old IBMers caught in the sold PC division would quickly will appear on a Chinese take-away menu, thereby helping fix IBM's embarrassing pension funding problems.
Click Here

Instead, an even better and more audacious speculation is that once publicly free of the PC division IBM will either buy, or form a close joint venture with Apple to sell its PCs, which coincidentally are now built around IBM's PowerPC chip.

Selling its PC Division would also pave the way for such an IBM move to be approved by the FTC. To add even more heat to already hot gossip, it turns out that Apple is not among the published list of early companies signing up for IBM's PowerPC consortia - a rather strange gap given Apple's now absolute dependency on that microprocessor range.

Well, you may ask, why would they sign up if a romance with IBM was in the air, or maybe even already consummated? And, knowing just how difficult it is to keep secrets these days, is it coincidence that some financial analysts have doubled their estimate of Apple's stock price expectation recently?

Just think how many positives for IBM such a marriage would provide. IBM would give the same credibility to the Macintosh computer, and its Microsoft-beating operating systems as it provided for the PC in the first place, thereby opening the flood gates of corporate demand.

Then of course there is Darwin, Apple's version of BSD Unix at the heart of its Mac OS X operating system, which would nicely provide IBM with a non Linux semi-open source alternative, and one that is focused on its on benchmark beating P (sorry G) 5 microprocessor. And of course there is all that synergy in the high performance, bargain priced Unix server and disk array products that Apple has taken to market, which must be hard to resist.

Hitching up with Apple would provide IBM with a real inroad into the fast growing 'lifestyle' market, something the men and women in blue suits kind of missed. Perhaps most of all, it would be a way for IBM to get even with Microsoft for all that bad blood over the early versions of Windows, which IBM partnered in, and apparently accidentally part-funded. Remember that what IBM got out of that for its money was an operating systems that chairman Gerstner famously named Warp, which turned out to be the speed at which it hurtled into oblivion.

Cast your mind back to Apple's announcement that hell had frozen over when they launched a Windows version of iTunes. I wonder what in hell will happen if there is any substance to this rumor. We shall see...(R)

[Q Classic]

You are too intolerant of other people, alternative ideas and scepticism to ever be a successful organizer on a large scale.

pot (ag) calling kettle (as) black.

[Asher]

Originally posted by Atahualpa
Oh yeah, Aggie and Asher you can try to find a peaceful living. Apple and IBM are going to merge:

It's more plausible that IBM and Toyota merge than IBM and Apple.

[Asher]

It's official: http://money.cnn.com/2004/12/07/news...ex.htm?cnn=yes

[Urban Ranger]

Another interesting take:

Faultline would like to put forward another explanation of why IBM's PC business is suddenly up for sale, one that we haven't yet seen proffered in the various publications that have covered the news in the last few days.

IBM is effectively clearing out its unprofitable PC business, so that it can go into the PC chip business with its Power 5 chips. It can hardly sign up Hewlett-Packard and Dell as Power 5 customers while it competes head on with one of their primary businesses, and by selling off its PC division it takes away much of the friction with these two organizations.
Click Here

There is no rule that says that the next generation of Linux desktops need to be powered by an Intel chip, and given the performance of the Power architecture, accelerating gently ahead of Intel's single core chip capability, it is a natural contender for the de facto chip to power Linux, not just on servers, where it plays right now, nor just on Supercomputers, but down also on Workstations, PCs, and under the power of CE Linux, on consumer electronics devices, cheap internet access devices and even mobile phones.

In fact Intel is the last chip base that a fresh market, like China, would want to embrace, given that any devices made using Intel chips can also be used to run copies of Windows, legal or otherwise, and China wants to steer a wide course around Windows, and instead develop its own architectures.

It is then perhaps no coincidence that IBM announced the creation this week of Power.Org from an event in China, and that it is a Chinese company Lenovo that is leading the charge to buy IBM's PC operations for some $2bn or so. Perhaps the quid pro quo is that IBM's Power chipset becomes the future Chinese server standard.

link

[Dinner]

It seems like a good deal for IBM to get $1.7 billion and still keep a minority stack. In the long run I think it will be bad for the brand as now another company will get to use the IBM name but IBM won't be able to control the quality any more.

[Urban Ranger]

Legend OEM'ed for IBM and/or Dell, IIRC.