In the Web world, you know that a trend has major traction when IBM is all over it. Like any large Internet company, Big Blue is careful about which trends it latches onto. It was a good couple of years before they were spotted at the Web 2.0 conference, for example. However in the case of Internet of Things, IBM is proving itself to be an unusually early adopter.
At a table in Las Vegas, a town fueled by big bets, IBM software chief Steve Mills outlined one he doesn’t want to make: Buying application provider SAP.
A trade organization whose members include IBM, Microsoft and a laundry list of other tech companies announced this week that it has formed a group to create standards for a way of accessing information over the Internet known as “cloud computing.”
Oracle shares actually have gained ground since the company announced its plans to acquire Sun Microsystems thanks in part to the company’s promises to make the deal rapidly accretive to earnings. But in their enthusiasm for the deal, investors may be ignoring some significant risks.
As I noted earlier this month, the recent Cisco Systems decision to to move into the server business came with the risk that it might irritate both IBM and Hewlett-Packard, both of whom control big pieces of the server business while also reselling Cisco networking gear.
IBM posted first-quarter earnings of $2.3 billion, down 1 percent from its profit a year earlier, while revenue fell 11 percent to $21.71 billion.
Highlights from the company’s conference call with analysts:
4:33: CFO Mark Loughridge will be flying solo on the call today.
In a stunning turn of events, Oracle this morning announced perhaps its most aggressive acquisition yet, agreeing to acquire Sun Microsystems for $9.50 a share in cash, or $7.4 billion. Net of balance sheet cash and debt, the deal is worth $5.6 billion. The news follows the reported recent collapse of talks between IBM and Sun.
A trade group for tech companies wants to remind you that software gets pirated, too.
While most headlines have lately focused on the kind of piracy that takes place on the high seas, the Business Software Alliance launched a campaign Monday to draw attention to people selling illegal copies of its members’ products.
Canaccord Adams analyst Peter Misek this morning cut his rating on IBM to Hold from Buy on valuation basis. He maintains his $110 price target. “The share price has performed well during a volatile bear market, and while we continue to believe IBM is one of the more defensive names within the technology sector, the risk-reward level is more balanced with less than 8% return to our target price,” he writes.
Shifting U.S. jobs overseas is nothing new for technology giant International Business Machines Corp.–or the tech sector in general–but a brave new employee relocation strategy at Big Blue is raising some eyebrows.
On Monday, the markets started to question whether International Business Machines and Sun Microsystems will really get a deal done.
It was on March 19 that The Wall Street Journal reported that IBM was in talks to acquire Sun Micro. But it wasn’t until Monday that stock prices of the two companies really started to diverge, a sign perhaps that traders suddenly believed the deal could be endangered.
Is the Open Cloud Manifesto doomed even before it’s officially announced?
Well, if not, it’s certainly been hampered. Why? The top three cloud platforms have decided not to participate. So it looks like IBM, Sun, Cisco and a host of smaller companies will be on hand to represent the new Open Cloud Manifesto when it is announced on March 30. And some say Cisco’s support may be iffy. But who will not be among the list of supporters are Microsoft, Amazon and Google.
Seems the more the Street thinks about Cisco Systems’s announcement Monday that it will sell servers, the less the Street is inclined to be enthusiastic. As I noted Monday, Cisco is expected to lose current revenue from partners Hewlett-Packard and IBM as it comes into deep competition with both. And the effort Cisco will need to make to actually be successful in selling a server against both vendors seems somewhat formidable–however enthusiastic Cisco is about its “Universal Computing System.”
It’s a rough morning for the Indian IT outsourcing sector, which has been hit hard by a highly negative report from Wachovia analyst Edward Caso.
Caso says the group is likely to take another leg down, forecasting that April conference call season will see most of the companies issue guidance below Street expectations. He writes that “demand remains lackluster and decision-making slow.”
International Business Machines is pushing ahead with “cloud” computing technology–storing information and running applications in shared computing facilities, connected to users over the Internet.
IBM last month tacked on an additional role to Erich Clementi, its vice president for strategy. He’s now also general manager, enterprise initiatives, with responsibility for Blue Cloud, IBM’s name for cloud computing.
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