IBM

[freedom]

it's the "in thing" but I see it's not a good thing, the computer company that offers hardware products and also cloud, their hardware sales are going to die. If everybody buys cloud service nobody will need to buy anymore servers and big ticket servers are where the money is made. This really is a stupid thing that is going to kill themselves.

microsoft is offering cloud service for exchange emails, you pay $6 for a mailbox which comes with 25gb of storage space if you have 1000 users in your organization that's only $6k. Who then is going to need to buy a powerful server with additional 50-75 terabytes of storage with redundancies that is going to cost hundred thousands of dollars.

Cloud computing needs the hard back-end storages and servers too. A consolidated order by the cloud computing service provider, make more sense to IBM.

The internet marketing tool, together with other software tools, will bring a more comprehensive package to IBM customers.

(not vested)

A typical cloud company if you get a chance to tour their premises you can see they use the cheapest low end "blade" servers they ship over hundred of such servers bought from china and use software to "combine them" together to form a giant cloud. Then they offer utility ( pay as you use ) to potential customers that's how they operate. It's all low cost and equipment is also cheap.

Storage there's even more cheap option these days heard of iscsi? everything can run over a network cable these days no need to buy expensive storage that requires fiber links.

Everyone can choose to buy a 100-dollar smartphone, but who does Apple sell it's iPhone to?

[CityFarmer]

it's the "in thing" but I see it's not a good thing, the computer company that offers hardware products and also cloud, their hardware sales are going to die. If everybody buys cloud service nobody will need to buy anymore servers and big ticket servers are where the money is made. This really is a stupid thing that is going to kill themselves.

microsoft is offering cloud service for exchange emails, you pay $6 for a mailbox which comes with 25gb of storage space if you have 1000 users in your organization that's only $6k. Who then is going to need to buy a powerful server with additional 50-75 terabytes of storage with redundancies that is going to cost hundred thousands of dollars.

Cloud computing needs the hard back-end storages and servers too. A consolidated order by the cloud computing service provider, make more sense to IBM.

The internet marketing tool, together with other software tools, will bring a more comprehensive package to IBM customers.

(not vested)

A typical cloud company if you get a chance to tour their premises you can see they use the cheapest low end "blade" servers they ship over hundred of such servers bought from china and use software to "combine them" together to form a giant cloud. Then they offer utility ( pay as you use ) to potential customers that's how they operate. It's all low cost and equipment is also cheap.

Storage there's even more cheap option these days heard of iscsi? everything can run over a network cable these days no need to buy expensive storage that requires fiber links.

I am not sure who are the "typical" cloud companies. In our context here, we are talking about corporate customers, who are targeted by IBM. HA (high availability) is critical, so I doubt the use of consumer grade machines and etc to provide the cloud services.

[Clement]

I think one of the issues here is due to the fact that there are various deployment models for cloud computing, private cloud or public cloud.

From what I see, the model sgd is referring to is the public cloud model, where the data center and hardware stack is owned and run by a cloud vendor. While I have not examined the infrastructure vendors normally use to deliver such services, I would not be surprised if a lot of low end servers are networked together to achieve it.

As this model become popular, there will be fewer and fewer buyers for severs (the cloud vendors) and hardware vendors lose a lot of bargaining power over their new customers. Some like google are even cobbling up their own servers.

[yccheok]

There is similar question Warren Buffett: What does Warren Buffet see in IBM? but I would like to further analysis from higher level. (http://www.quora.com/Warren-Buffett/What...see-in-IBM)

I had been thinking this for a while. My only raw guess is as follow

Google, MSFT, Apple, ... are selling their tech products to end consumers. However, tech end consumers have a common characteristic. Their loyalty toward the product is not strong. The barrier of switching the tech products provider, is extremely low. An Android user, can become an Apple user anytime he feels he want to give it a try. The "switching" barrier is so low.

Hence, 10+ years ago, people were using Yahoo! for search, Nokia for mobile... Today, the entire consumer landscape is changing.

However, thing may be quite different for enterprise space. Enterprise users are reluctant to change their existing workable system. The barrier of switching the tech products vendor, can be extremely high. No one dare to bear the risk, of breaking an existing workable banking system. Even the new offered banking system, comes with better UI, slightly faster speed, ... They want something which is stable, and proven to work without faulty for years.

Warren Buffet is always looking to invest in long lasting business. IBM has proven it is the one, in tech enterprise space.

Would love to hear other thoughts on this.

I watch it drops till 175 few months ago. Too greedy. Want to wait him drops till 170. Now it cheong liao

[Clement]

Your views on ibm differ from mine. I see a lot of shifts away from the old in-house IT stack. While I agree enterprise IT has a longer product lifecycle than consumer, it is hardly like Coca Cola.

My question is more of a "would a younger Warren Buffett, not constrained by size, buy IBM?"

[CityFarmer]

IBM's role as adviser for the contract? Not quite sure on the detail...

(not vested)

IBM hit with US$2.5b lawsuit by Mexican mobile phone operator
17 Apr 2014 00:24
[NEW YORK] Mexican mobile phone operator Iusacell SA de CV sued IBM Corp on Wednesday, accusing the US technology giant of making fraudulent representations that caused it to lose US$2.5 billion in profits.

The lawsuit, filed in federal district court in New York, was heavily redacted, leaving many of the claims unclear. But the complaint centered on a contract Iusacell claimed IBM induced it to enter into in Mexico.

"Events subsequent to the execution of the agreement have revealed that IBM both knowingly misrepresented and wrongfully concealed from Iusacell material facts both before and during the parties relationship," Iusacell said in the complaint.

The lawsuit seeks more than US$2.5 billion in damages.

A spokeswoman for IBM did not immediately respond to a request for comment. - Reuters

Source: Business Times Breaking News

[CityFarmer]

Do China has local alternative to IBM servers? IBM hardware is the de facto standard in banking sector. May be it will create an opportunity to groom a domestic brand...

China pushes banks to scrap IBM servers over security fears

BEIJING — The Chinese government is pushing domestic banks to remove high-end servers made by International Business Machines (IBM) and replace them with a local brand, said people familiar with the matter, in an escalation of the dispute with the United States over spying claims.

Government agencies, including the People’s Bank of China and the Ministry of Finance, are reviewing whether the reliance of Chinese commercial banks on IBM servers compromises the country’s financial security, said the four sources, who asked not to be identified as the review has not been made public.
...
http://www.todayonline.com/tech/china-pu...rity-fears

[sgd]

huawei? rh means redhat? Opensource means they can also modify the code ?

http://www.huawei.com/en/products/server.../index.htm

Do China has local alternative to IBM servers? IBM hardware is the de facto standard in banking sector. May be it will create an opportunity to groom a domestic brand...

China pushes banks to scrap IBM servers over security fears

BEIJING — The Chinese government is pushing domestic banks to remove high-end servers made by International Business Machines (IBM) and replace them with a local brand, said people familiar with the matter, in an escalation of the dispute with the United States over spying claims.

Government agencies, including the People’s Bank of China and the Ministry of Finance, are reviewing whether the reliance of Chinese commercial banks on IBM servers compromises the country’s financial security, said the four sources, who asked not to be identified as the review has not been made public.
...
http://www.todayonline.com/tech/china-pu...rity-fears

[CityFarmer]

IBM sale figure is one good indicator for corporate capex. It seems the capex is lagging behind consumer spending...

(not vested)

IBM software sales weaker than expected in second quarter

WASHINGTON - International Business Machines Corp's software business grew less than expected in the second quarter, sparking a selloff in the company's stock on Thursday, even as its revenue beat forecasts.

The company's software business revenue grew 1 percent in the quarter to $6.5 billion, slower than forecasts of 3 percent, as it signed fewer contracts than expected.

"We expect acceleration of software revenue to mid-single digits in second half of 2014," IBM Chief Financial Officer Martin Schroeter said on a conference call after the results were released.
...
http://www.todayonline.com/business/ibm-...data-cloud

[CityFarmer]

It seems the Watson is not only applicable to financial system... This is definitely an wide moat of IBM. Who else have a comparable "Watson"?

(not vested)

Govt to use IBM supercomputer to improve services on websites

SINGAPORE — Come next year, a person making inquiries on government websites over matters such as income tax or employment can expect faster and more specific answers, under a pilot project the Government is conducting in collaboration with IBM.

The project will make use of IBM’s supercomputer, known as Watson, to enable Singaporeans to access government information more easily and to offer more personalised service on government-related matters.

In announcing the partnership with the American tech company yesterday, the Government said Watson would be able to provide government agencies with insights into the public’s concerns and priorities, leading to improved government services and better citizen engagement.

This is the first time that any government is working with IBM on this computing system, which can process and analyse large amounts of data to come up with solutions to problems.
...
http://www.todayonline.com/singapore/gov...s-websites