IBM SoftLayer and Kasbah Systems Software Help Universities Improve Education Management in the CloudPR Newswire (Tue, 12:00PM)
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PR Newswire (Dec 10, 2013)
at CNBC.com (Dec 10, 2013)
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PR Newswire (Dec 6, 2013)
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at CNBC.com (Dec 10, 2013)
International Business Machines Corporation (IBM or the company) was incorporated in the State of New York on June 16, 1911, as the Computing-Tabulating-Recording Co. (C-T-R), a consolidation of the Computing Scale Co. of America, the Tabulating Machine Co. and The International Time Recording... More
Thursday, Dec 124:13 PM
Thursday, Dec 124:13 PM| 5 Comments
- Beauty products giant Avon (AVP -1.3%) expects to take a $100M-$125M charge related to the failed rollout of an SAP-based (SAP -0.6%) order management software system. The WSJ states the system was "so burdensome and disruptive to Avon representatives' daily routine that they left in meaningful numbers."
- As Steve Rosenbush notes, Avon's decision, and the employee backlash that triggered it, shines a light on how corporate workers are increasingly demanding the business apps they use be as intuitive and user-friendly as the consumer apps they rely upon.
- This trend, which ties into the "consumerization" of IT, poses a challenge to traditional enterprise software giants such as SAP, Oracle (ORCL), and IBM, and often works to the benefit of enterprise cloud software providers whose offerings emphasize ease-of-use and flexibility over the richest possible feature set.
Wednesday, Dec 115:11 PM
Wednesday, Dec 115:11 PM| 14 Comments
- IT services demand "depends on what the economic climate is, and that has not been very encouraging," says Erich Clementi, head of IBM's Global Technology Services (GTS) unit. "Europe has shown signs of recovery. North America has been a little more uncertain.”
- The remarks comes less than two months after a big Q3 revenue miss blamed on a mixture of macro issues (particularly in emerging markets) and sales execution.
- Though IBM's services backlog was flat Q/Q and up 2% Y/Y in Q3 to $141B, GTS revenue fell 4% Y/Y and global business services revenue fell 5%. Together, the businesses accounted for 59% of IBM's revenue, and 51% of its op. profit.
Friday, Dec 66:41 PM
Friday, Dec 66:41 PM| 2 Comments
- IDC estimates server sales fell 3.7% Y/Y in Q3. That's a modest improvement from Q2's estimated 6.2% drop, but hardly a figure that will bring cheer to industry players. Gartner estimates revenue fell 2.1% in Q3 vs. 3.8% in Q2.
- The embrace by Web/cloud giants of home-grown servers produced by Asian contract manufacturers (ODMs) continues to upend the industry. IDC thinks sales of such servers rose 45% Y/Y, and now make up 6.5% of industry revenue. It estimates nearly 4/5 of these sales came from the U.S., largely from Google, Facebook, Amazon, and Rackspace.
- #1 H-P (HPQ), which recently reported encouraing enterprise hardware numbers, is assigned a 28.1% share (+150 bps Y/Y) by IDC. #2 IBM, whose total Q3 hardware sales fell 17% Y/Y, is given a 23.4% share (-430 bps).
- Newly-private Dell had a 16.2% share (-40 bps, a reversal from recent gains), Cisco (CSCO - still seeing strong UCS server demand) a 5% share (+170 bps), and Oracle (ORCL - hurt by SPARC/UNIX server weakness) a 4.1% share (-60 bps).
- In a positive for Intel (INTC), x86 servers took share once again, with sales rising 2.8% and making up 79% of industry revenue. Red Hat (RHT) is likely pleased to see Linux servers now make up 28% of industry revenue. Windows (MSFT) servers made up 50%, and UNIX servers just 11%.
- H-P is the leader in the x86 server market (32.3% share), as well as in the growing blade server (43.6%) and density-optimized server (30.7%) markets. There's a decent amount of overlap between the x86 and blade/density-optimized markets.
Friday, Dec 610:29 AM
Friday, Dec 610:29 AM| 10 Comments
- IBM (IBM +0.7%) has inked $1.3B worth of outsourcing deals (spread out over 7 years) with Dexia and several other European financial institutions to manage their IT infrastructures. (PR)
- As a result, IBM will take a controlling stake in the Dexia IT services unit that had been managing said infrastructures, and will "implement a cloud infrastructure" to expand the Dexia unit's services offerings into new markets.
- The tie-up is the kind of higher-margin/value-added services deal IBM has been focusing on, as it looks for way to maintain EPS growth in the face of top-line weakness. IBM's services revenue fell 4% Y/Y in Q3, but its backlog ($141B) was flat Q/Q and up 2% Y/Y.
- Separately, Cowen has downgraded IBM to Market Perform. The firm cites negative survey data regarding Big Blue's services workload and execution/delivery, and (with $100B worth of contracts set to be renegotiated in 2014, and Indian competition an issue) thinks the company's U.S. revenue growth outlook and IT outsourcing base are at risk.
Tuesday, Dec 34:18 AM
Tuesday, Dec 34:18 AM| 4 Comments
- Google (GOOG) has made its Compute Engine cloud service generally available as it moves to further compete with Amazon Web Services (AMZN), Microsoft's (MSFT) Azure and IBM's (IBM) offering.
- Google has cut prices for its infrastructure-as-a-service offering by 10%, is providing access to larger and more complex computing, and it guarantees that critical projects will remain working 99.95% of the time.
- Photo-swapping service Snapchat is an early user of Compute Engine, processing 4,000 pictures a second on Google's servers. (Blog)
Wednesday, Nov 2711:53 AM
Wednesday, Nov 2711:53 AM| 7 Comments
- Though Amazon Web Services (AMZN) has been seeing intensifying competition in the cloud infrastructure (IaaS) market, Synergy Research's numbers, like Gartner's, suggest AWS continues to dominate.
- Synergy estimates AWS had a 35% IaaS share in Q3, or 5x that of #2 IBM, whose position has been bolstered by SoftLayer. All other vendors are assigned shares below 3%.
- The situation is a little different in the cloud app platform (PaaS) market. Salesforce's (CRM) Heroku, long a major player, is given a market-leading 18% share. But AWS is close behind at 17%, and so are Microsoft's (MSFT) Windows Azure (14%) and Google's (GOOG) App Engine (13%). All other vendors are estimated to have sub-5% shares.
- Altogether, Synergy thinks Amazon grew its IaaS/PaaS revenue by 55% Y/Y, outpacing the 46% growth seen by the overall market. Moreover, AWS' IaaS/PaaS revenue is believed to have eclipsed that of Microsoft, Google, IBM, and Salesforce combined.
- The report drives home the competitive challenges faced by Rackspace (RAX), VMware (VMW), Red Hat (RHT), and other firms striving to take IaaS and/or PaaS share from market leaders.
- Synergy thinks the traditional Web hosting market, which Rackspace remains well-exposed to, and which has been pressured by the IaaS market's rise, only grew 3% Y/Y in Q3.
- Last week, Stanley Druckenmiller cited AWS and its disruptive impact on traditional enterprise IT as a reason for shorting IBM.
Monday, Nov 254:03 PM
Monday, Nov 254:03 PM| 17 Comments
- The most popular shorts according to Goldman's Hedge Fund Monitor which analyzes the positions of 783 funds with $1.6T in assets (in reverse order, i.e. the last in this list is the most heavily shorted): SYY, KO, TGT, BMY, SNDK, UPS, SLB, GE, CVX, PFE, CAT, COP, EMC, PG, NFLX, WMT, JNJ, DIS, CRM, VZ, IBM, XOM, T, GILD, INTC.
- A quick scan finds Netflix making both the top 25 list of most heavily shorted and the top 20 list of most concentrated longs. List of 20 longs is here.
Friday, Nov 222:27 PM
Friday, Nov 222:27 PM| 28 Comments
- Hedge fund manager Stanley Druckenmiller has called IBM (IBM -1.5%) one of the "more high probability shorts" he's seen in years, and declares Amazon Web Services (AWS) is "killing" the IT giant.
- He's also critical of Big Blue's slumping free cash flow, and its efforts to boost flagging growth via M&A.
- AWS is expected to pull in less than $4B in revenue this year, but is growing at a rapid clip. In addition, analysts have argued every IT dollar eaten up by cloud services results in a greater amount of on-premise IT spend being lost.
- IBM recently bought Web hosting/cloud infrastructure provider SoftLayer for a reported $2B in order to better take on Amazon, as well as rivals such as Microsoft, Google, VMware, and Rackspace.
- Though off its October lows, IBM remains down 5% YTD in a year during which the Nasdaq is up over 30%. Shares were hit hard last month by a Q3 revenue miss.
Monday, Nov 1810:38 AM
Monday, Nov 1810:38 AM| Comment!
- Nvidia (NVDA) has unveiled the Tesla K40, a server/HPC GPU it claims is 40% more powerful than its predecessor (the Tesla K20X) and the first product of its kind optimized for big data/analytics and large-scale scientific use cases.
- The K40, which competes against AMD's FirePro and Intel's Xeon Phi lines, comes with 12GB of memory and 2,880 GPU cores, as well as Nvidia's GPU Boost tech.
- In tandem with the K40 launch, Nvidia has announced a partnership with IBM to develop "GPU-accelerated versions" of IBM apps running on Big Blue's high-end Power systems (they rely on IBM's Power CPUs). Nvidia's CUDA programming model (allows apps to be optimized for Nvidia GPUs) will be leveraged, as will IBM's Rational software development tools.
- IBM has been getting creative in its efforts to grow Power-related sales in the face of plunging demand for traditional UNIX Power servers. Three months ago, IBM announced it would license the Power architecture and related technologies to spur broader adoption, particularly among Web/cloud companies; Nvidia was one of the launch partners. More recently, the company opened up its Power-based Watson A.I. computing platform to 3rd-party developers.
- Nvidia has also announced SGI, Cray, and other server vendors will offer the K40, and that the Tesla GPUs will work with Mellanox's (MLNX +1.9%) InfiniBand adapters (often used in HPC applications).
- Nvidia's Tesla GPU sales have been growing quickly, helping offset PC and Tegra weakness. The chipmaker has also been targeting the server GPU space with its Grid GPUs (meant for cloud gaming and PC virtualization apps).
- Previous: Nvidia hit by Morgan Stanley downgrade
Friday, Nov 158:39 AM
Friday, Nov 158:39 AM| Comment!
- IBM, no stranger to issuing low-yield corporate debt, is offering £750M worth of Dec. 2020 notes sporting an interest rate of just 2.75%.
- With the company having just added $15B to its buyback program, there's a good chance some of the funds will be used to fund additional stock repurchases, which have been crucial to keeping EPS growth positive in the face of declining revenue.
- IBM ended Q3 with $36.2B in debt, or $10.4B if one backs out its Global Financing division. Cash/equivalents totaled $10.2B.
- Meanwhile, IBM has opened up its Watson supercomputer/artificial intelligence platform to 3rd-party developers. A developer toolkit and API is being provided, and Big Blue also plans to work with VCs to compel startups to write cloud-based apps for the platform. Retail, supply chain, and health management apps are already in the pipeline. (PR)
- IBM is counting on Watson, which runs on its proprietary Power CPUs, to give a lift to a Power server business that saw a 38% Y/Y sales drop in Q3 thanks to nosediving UNIX server demand.
Friday, Nov 154:41 AM
Friday, Nov 154:41 AM| 5 Comments
- Cisco's (CSCO) FQ1 results earlier this week highlight how major tech firms are feeling the impact of a backlash in China to Edward Snowden's revelations about U.S. spying.
- "All the big U.S. IT companies are concerned," says Jim Lewis, a China and technology expert at the Center for Strategic Studies in Washington.
- Cisco has been the most explicit about attributing the Snowden effect to its falling sales in China; Beijing could be specifically targeting the company due to American hostility to telecom-equipment makers Huawei Technologies and ZTE (ZTCOY) over fears that their products could be used for espionage.
- However, Juniper's (JNPR) experience is that the "The Snowden effect is not real," adding that business in China continues to grow.
- Other companies to suffer in the country recently include IBM (IBM) and Microsoft (MSFT), with the reasons cited including macro-economic factors. IBM might be somewhat inured to the NSA affair, as some of its high-end products face less competition than Cisco's offerings.
Wednesday, Nov 138:34 PM
Wednesday, Nov 138:34 PM| 5 Comments
- Cisco's (CSCO) dispiriting Jan. quarter guidance and Oct. quarter order data has produced an AH selloff in enterprise IT and telecom equipment names, as well as a couple of the companies supplying them. NetApp's below-consensus guidance might not be helping either.
- HPQ -2.1% AH. IBM -1.1%. ALU -2%. FFIV -1.9%. CIEN -0.9%. CAVM -3%. BRCM -1.3%.
- Cisco's slumping FQ1 service provider (-13% Y/Y) and emerging markets (-12%) orders are bound to fuel concerns about carrier capex and macro trends. At the same time, it's worth noting Juniper and Alcatel-Lucent have been seeing better router sales to carriers (though not to Asia), and that Huawei has been doing better in emerging markets.
- The rest of Cisco's order data for major regions and customer groups was relatively better, but not exactly encouraging. Americas orders -2%, EMEA -4%, Asia-Pac (hurt by emerging markets weakness) -9%. Enterprise orders +2%, commercial (SMBs) +1%, public sector -1%.
- Switch sales (31% of revenue) rose 3% Y/Y, while routers (17% of revenue) fell 1%. Collaboration rose 1%, and service provider video fell 14% due to set-top weakness. Cisco's ASR 9000 edge router line, which EZchip (EZCH) supplies network processors for, grew 20% in FQ1 vs. 43% in FQ4.
- Data center (UCS servers) had another strong quarter, growing 44%, but still only accounts for 5% of revenue. Wireless (dominated by Wi-Fi gear) grew only 8% after growing 32% in FQ4 (could be a negative for ARUN and RKUS).
- John Chambers was asked on the CC (transcript) if the NSA spying uproar was affecting Cisco. He admitted it's a problem in China, but denied it was a major issue elsewhere.
Wednesday, Nov 139:34 AM
Wednesday, Nov 139:34 AM| 1 Comment
- IBM is acquiring Fiberlink Communications, a player in the growing and hotly competitive mobile device management (MDM) software space. Fiberlink also provides mobile security and app management software. As usual, deal terms are undisclosed. (PR)
- The acquisition puts IBM into competition with a list of MDM/app management vendors that includes SAP, Citrix, BlackBerry, and private Good Technology and AirWatch.
- Big Blue says it will add Fiberlink's cloud-based offerings to its MobileFirst enterprise mobile software platform, and will help it deliver "a comprehensive mobile management and security offering" to companies embracing the bring-your-own-device (BYOD) trend.
- The deal comes six weeks after IBM acquired (in rapid succession) mobile analytics software firm The Now Factory, and mobile messaging/ad promotion firm Xtify.
Thursday, Nov 74:58 PM
Thursday, Nov 74:58 PM| 11 Comments
- IBM discloses CFO Mark Loughridge will "retire from the company" at year's end. Martin Schroeter, currently the head of IBM's Global Financing unit and once the company's treasurer, will replace him. (8-K)
- Loughridge, who will turn 60 next month, has been IBM's CFO for nine years. While Big Blue's top-line performance has fluctuated during this time, it has almost consistently delivered EPS growth thanks to cost cuts, buybacks, and a focus on higher-margin products/services.
Friday, Nov 17:00 AM
Friday, Nov 17:00 AM| 3 Comments
- India's tax office has reportedly ordered IBM (IBM) to pay an extra 53.57B rupees ($865M) in taxes due to the tech giant allegedly under-reporting its income in the FY ended March 2009.
- A tax official accused IBM India of disclosing just 20-30% of its earnings.
- IBM isn't the first multinational to fall afoul of India's government over tax - Nokia and Vodafone also have running disputes with the country over the issue.
Wednesday, Oct 3011:09 AM
Wednesday, Oct 3011:09 AM| 7 Comments
- IBM (IBM -0.2%) has withdrawn its protest of a $600M contract handed by the CIA to Amazon Web Services (AMZN +0.3%). The withdrawal, which follows a court ruling in Amazon's favor, clears the way for Amazon to build a private cloud infrastructure for the CIA in what's likely to serve as an important reference deal when competing for future enterprise/government contracts.
- Amazon's "Other" North American sales, dominated by AWS, jumped 56% Y/Y in Q3 to $1.01B. However, much of AWS' growth thus far has come from Web/cloud service providers such as Dropbox, Pinterest, Netflix, and Salesforce's Heroku unit. While AWS has gradually been making enterprise inroads, it also faces strong competition here from IBM, Microsoft's Windows Azure, VMware's vCloud Hybrid, and Verizon Cloud, among others.
- IBM scored a 10-year, $1B, cloud services deal from the Department of the Interior in August.
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