IBM to focus on its open hybrid cloud platform and AI capabilities

guest · Oct 8, 2020

IBM to spin off IT infrastructure unit, focus on cloud business
October 8, 2020
https://www.reuters.com/article/us-...re-unit-focus-on-cloud-business-idUSKBN26T1TZ

International Business Machines Corp said on Thursday it would spin off its IT infrastructure unit to focus more on cloud computing, a high-margin business that has seen a boost as companies increasingly ramp up their digital shift.
Shares of the company were up nearly 14% in premarket trading.

Arvind Krishna, who took over as chief executive officer from Ginni Rometty in April, said IBM’s software and solutions portfolio will account for the majority of company revenue after the separation.

“The success we’ve had with Red Hat gives us confidence that this is the right move,” Krishna said, calling the move a “significant shift” in the company’s business model.
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The separation of the new company, a tax-free spin-off to shareholders, will be completed by the end of 2021, IBM said.
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Press Release: IBM To Accelerate Hybrid Cloud Growth Strategy And Execute Spin-Off Of Market-Leading Managed Infrastructure Services Unit

IBM (NYSE: IBM) announced today it will accelerate its hybrid cloud growth strategy to drive digital transformations for its clients. Additionally, IBM will separate its Managed Infrastructure Services unit of its Global Technology Services division into a new public company ("NewCo"). This creates two industry-leading companies, each with strategic focus and flexibility to drive client and shareholder value.
IBM, a Leading Hybrid Cloud and AI Company
With tighter integration and focus on its open hybrid cloud and AI solutions, IBM will move from a company with more than half of its revenues in services to one with a majority in high-value cloud software and solutions.
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NewCo, the Leading Managed Infrastructure Services Company
The new company (to be named at a subsequent date) will immediately be the world's leading managed infrastructure services provider.

NewCo will also be able to partner fully across all cloud vendors, opening new avenues for growth, while maintaining a strong strategic partnership with IBM and continuing to serve existing and new clients.
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guest · Oct 10, 2020

Why IBM is splitting its business in two
While the focus on cloud may sound like a revolution, the old regime remains
October 9, 2020
https://www.itpro.co.uk/business/business-strategy/357378/why-ibm-is-splitting-its-business-in-two

Stop me if you’ve heard this one before: A giant of the tech industry with a history stretching back many decades and a footprint in most large organisations – and many smaller ones – finds itself struggling against the tide of digital transformation and the shift to cloud.

Despite its best efforts to reform its business over a number of years, IBM has taken the decision to split its company in two in the hope that, as separate entities, they can pursue more successful growth strategies than they could under one umbrella – but they will maintain close ties.
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It’s clear from the announcement that the centenarian company does very much want to capitalise on its strengths in AI and cloud, with Red Hat taking centre stage as an example of its excellence in the latter and talk of being “laser-focused on the $1 trillion hybrid cloud opportunity”.
Reading between the lines, however, it’s also clear that IBM has no intention of letting go of its core infrastructure heritage, either.

And why not? One of IBMs strengths is its enterprise hardware products and, when it comes to things like mainframe, it has very few competitors.
What it won’t be doing any more, however, is managing that hardware.
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guest · Nov 25, 2020

As IBM shifts to hybrid cloud, reports have them laying off 10,000 in EU
November 26, 2020
https://techcrunch.com/2020/11/25/a...oud-reports-have-them-laying-off-10000-in-eu/

As IBM makes a broad shift in strategy, Bloomberg reported this morning that the company would be cutting around 10,000 jobs in Europe. This comes on the heels of last month’s announcement that the organization will be spinning out its infrastructure services business next year.

While IBM wouldn’t confirm the layoffs, a spokesperson suggested there were broad structural changes ahead for the company as it concentrates fully on a hybrid cloud approach.

IBM had this to say in response to a request for comment on the Bloomberg report: “Our staffing decisions are made to provide the best support to our customers in adopting an open hybrid cloud platform and AI capabilities. We also continue to make significant investments in training and skills development for IBMers to best meet the needs of our customers.”
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Unfortunately, that means basically if you don’t have the currently required skill set, chances are you might not fit with the new version of IBM. IBM CEO Arvind Krishna alluded to the changing environment in an interview with Jon Fortt at the CNBC Evolve Summit earlier this month [...]
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