Jul. 17, 2014, 4:10 PM| 15 Comments
Jul. 17, 2014, 7:35 AM
- Pratt & Whitney (NYSE:UTX) has hired IBM (NYSE:IBM) to analyze massive amounts of data from approximately 4,000 commercial aircraft engines in an effort to calculate potential engine trouble before problems arise.
- "Rather than reacting to some sort of an engine event, we are leveraging data from various sources for maintenance, for planning engine diagnostic systems and building predictive models," says IBM VP Jerry Kurtz.
- Due to the new proactive maintenance program, Pratt & Whitney expects to extend engine life by over almost 50% and decrease maintenance costs by up to 20%. A typical engine repair can fetch between $3M to 10M.
Jul. 16, 2014, 5:35 PM
Jul. 16, 2014, 12:24 PM
- The Apple (AAPL +1.2%)/IBM (IBM +2.4%) deal is a "landmark agreement," that gives Apple "enterprise capabilities and credibility at one stroke," says Forrester's Frank Gillett. He notes that while the BYOD trend has bolstered Apple's enterprise presence, the company has until now "resisted servicing enterprises" out of fear of hurting its user experience.
- Endpoint Technologies' Roger Kay: "What [the deal] allows Apple to do is not change its philosophy and lay off to IBM the whole issue of, how do you make iPhones work for IT managers who actually want to be treated like a valued customer."
- Tim Cook: "We’re good at building a simple experience and in building devices ... The kind of deep industry expertise you would need to really transform the enterprise isn’t in our DNA. But it is in IBM’s." He also highlights the value of IBM's 100K+ consultants/sales workers.
- RBC and Canaccord both think iPhone sales could get a boost; the former is also upbeat about the premium AppleCare service that will be developed. Baird thinks the deal "could help AAPL cement iOS as the preferred platform for enterprise."
- Piper's Gene Munster, however, doesn't see a huge hardware impact. "We note that if half of the Fortune 500 were to each purchase an incremental 2,000 iPhones and 1,000 iPads above what they were planning to purchase ... it would mean about a half a percent to CY15 revenue." He also expects IBM to eventually offer similar Android solutions.
- The deal strengthens IBM's MobileFirst initiative, through which Big Blue is already offering a variety of enterprise mobile apps/services. An IBM exec: "We wanted to focus on creating an absolutely irresistible workflow and processes and a design of apps that can be used by every user."
Jul. 15, 2014, 4:50 PM
- As part of a comprehensive enterprise mobility partnership, Apple (NASDAQ:AAPL) and IBM plan to develop 100+ "industry-specific enterprise solutions," including new iPhone/iPad apps.
- The apps will begin to arrive this fall, and IBM will resell iPhones/iPads containing them to clients worldwide.
- The companies also plan to develop IBM cloud services optimized for iOS. Targeted markets include security, mobile device management (MDM), and big data/analytics. New enterprise-focused AppleCare services will be offered, as will "new packaged offerings from IBM for device activation, supply and management."
- Apple, which maintains an outsized share of enterprise mobile hardware activations, has tried hard to grow its business footprint during the Tim Cook era. Aside from any value provided by the new apps/services, Big Blue's credibility and relationships with Global 2000 firms should provide a shot in the arm for Apple's efforts.
- As for IBM, the deal adds to a mobile software/services push that has already resulted in a string of acquisitions and product launches.
- AAPL +1.4% AH. IBM +2%. BlackBerry (NASDAQ:BBRY) -3.2%, as investors worry about the MDM portion of the alliance. MobileIron (NASDAQ:MOBL) could also be affected by it.
- Update: Tim Cook, discussing the deal with re/code: "We’re good at building a simple experience and in building devices ... The kind of deep industry expertise you would need to really transform the enterprise isn’t in our DNA. But it is in IBM’s."
Jul. 9, 2014, 7:21 PM
- Though its struggling chip manufacturing unit is reportedly on the block, IBM is committing $3B over 5 years to develop new chip technologies.
- Big Blue's efforts will focus on pushing the limits of Moore's Law - whereas transistor widths are currently down to 14nm, IBM will explore ways to bring them to 7nm or less in time - and on commercializing unconventional materials and technologies.
- The materials/technologies in question include carbon nanotubes, silicon photonics, graphene, and quantum computing. Intel, H-P, and Nokia are among the companies exploring one or more of those fields.
- Even if its chip manufacturing unit gets sold, IBM is likely to continue designing chips for its own hardware (for example, its Power server CPUs). The company has also built up a lucrative IP licensing business that partly relies on chip-related IP.
Jul. 7, 2014, 7:26 AM
- IBM (IBM) will partner with Beijing - increasing the monitoring and forecasting capabilities of the Chinese capital to reduce its issues of severe smog. IBM aims to help the city through its collection of real-time emissions data and forecasting expertise, and to help it attain its 10-year Green Horizon initiative.
- Beijing already has an alert system to predict heavy pollution days in advance, allowing it to shut schools and factories when needed, but residents say is not enough.
Jul. 4, 2014, 4:42 AM
- Lenovo's (LNVGF) $2.3B deal for IBM’s (IBM) low-end server business has been approved by the the Chinese Ministry of Commerce's anti-monopoly bureau.
- The acquisition is still awaiting approval in the U.S., as the Committee on Foreign Investment in the United States investigates possible American national-security risks under the proposed deal, including concerns of the Pentagon's use of IBM servers.
Jul. 2, 2014, 1:56 AM
- Lenovo (LNVGF) is still expecting to close the $2.3B deal on IBM’s (IBM) low-end server business this year, although the acquisition is still being investigated by the U.S. for national-security risks.
- One of the main concerns is that IBM's x86 servers are used in U.S. communication networks and in data centers that support the Pentagon's computer networks.
- The company is also attempting to obtain regulatory approval to buy Google's Motorola Mobility, in another multi-billion-dollar acquisition valued at $2.9B.
Jun. 11, 2014, 11:22 AM
- Bloomberg's report follows an April WSJ report calling Globalfoundries "the lead candidate" to buy IBM's (IBM -0.6%) chip manufacturing/foundry ops. Notably, Globalfoundries is said to be more interested in Big Blue's chip engineers and IP than its relatively old wafer fabs.
- A source states the unit has been losing as much as $1.5B/year. Its Q1 sales fell 16% Y/Y amid continued share losses to Globalfoundries, Samsung, and foundry giant TSMC (TSM -0.5%).
- Nonetheless, the business claims high-profile foundry clients such as Cisco and Juniper, and has a history of leading the way in mass-producing new chip technologies/materials, such as silicon-on-insulator (SOI) and silicon germanium (SiGe).
- That could help Globalfoundries as it tries to gain ground against TSMC, which has a long list of blue-chip mobile processor, GPU, and FPGA clients.
- The WSJ's report stated the unit has received $1B+ bids - less than the $2B+ IBM was initially seeking.
Jun. 6, 2014, 6:40 PM
- Thanks to a 25% drop in high-end storage spend, external disk storage and total disk storage sales respectively fell 5.2% and 6.9% Y/Y in Q1, says IDC. Those figures contrast with Q4 growth rates of 2.4% and 1.3%.
- Market leader EMC, which depends heavily on its high-end Symmetrix line, saw its external share fall 110 bps Y/Y to 29.1%, and its total share fall 50 bps to 22.4%. EMC previously reported its high-end sales fell 22% in Q1; strong flash/scale-out storage sales partly offset the drop.
- NetApp's (NTAP) low high-end exposure allowed its shares to grow 30 bps and 50 bps to 15.1% and 11.7%, in spite of a 2.8% revenue drop. H-P's (HPQ) external share rose 40 bps to 8.8% (3PAR strength), but its total share fell 20 bps to 15.1% (server weakness).
- Things still look bleak for IBM, which reported a 23% Y/Y Q1 system storage revenue drop: Its external share fell 200 bps to 8.8%, and its total share 180 bps to 10.1%.
- The total disk share of non-top-5 vendors rose 370 bps to 28.8%. Chalk that up to both surging demand for cloud storage (getting cheaper by the quarter) running on commodity hardware, and solid momentum for flash/hybrid storage upstarts such as Nimble (NMBL), Pure Storage, and Nutanix.
- Hard drive/assembly suppliers: STX, WDC, HTCH
Jun. 5, 2014, 7:40 PM
- Dozens of companies, including IBM and H-P (HPQ), found an unwelcome surprise in their supply chains in their search for "conflict minerals," part of the Dodd-Frank Act designed ferret out any connection to mines controlled by armed groups in the Congo: Many of their products contain North Korean gold.
- IBM, for example, disclosed that the North Korean gold was used to make its memory storage systems.
- North Korea’s central bank provides currency for the country and refines gold, but U.S. sanctions law bars importing materials from the country, even if it comes from deep within a supply chain.
- "There is still a long way to go in understanding supply chains," says an attorney who deals with conflict mineral disclosures.
- Other companies making the discovery included Ralph Lauren (RL), Rockwell Automation (ROK) and Williams-Sonoma (WSM).
Jun. 5, 2014, 2:15 AM
- Lenovo (LNVGF) and IBM (IBM) are looking to extend their deal deadline, as the Committee on Foreign Investment in the United States (CFIUS) continues the review of Lenovo's planned purchase of IBM’s low-end server unit for $2.3B.
- The CFIUS assesses acquisitions for their national-security implications, and the deal between China-based Lenovo and IBM comes at a time of tensions between the U.S. and China over spying and hacking claims.
- IBM CEO Ginni Rometty has stressed the importance of the deal, and how it could stage a comeback for IBM, as users increasingly change to cloud-computing, reducing the need for servers and mainframes.
- If approved, Lenovo has stated that the companies can seal the deal by the end of the year.
May. 30, 2014, 6:41 PM
- IDC estimates global server sales fell 2.2% Y/Y in Q1, a slightly smaller decline than the 4.4% drop seen in Q4. Gartner, however, puts the decline at 4.1%.
- The embrace of white-label hardware by Web giants continues taking a heavy toll: IDC thinks white-label sales, which it calls ODM Direct, grew 75% Y/Y (up from Q4's 47% clip) and made up 7.3% of industry revenue, up from 6.4% in Q4 and 4.1% a year ago.
- IDC estimates market leader H-P (HPQ) saw its share hold steady at 26.5%, after having grown (at IBM's expense) 260 bps Y/Y in Q4. #2 IBM, whose hardware sales have been battered, saw its share fall 600 bps Y/Y to 19.1%.
- #3 Dell's share slipped 20 bps to 18%, while #4 Cisco (CSCO), which just reported a 29% Y/Y April quarter sales jump for its UCS server segment, saw its share rise 170 bps to 5.7%. #5 Oracle (ORCL), whose server sales are finally stabilizing thanks to engineered systems growth, rose 20 bps to 4.9%.
- Sales of x86 servers, over 90% of which contain Intel (INTC) CPUs, rose 4.9% after growing 7.8% in Q4. Non-x86 server sales tumbled 25.2%, and now make up just 17.9% of industry revenue.
- Cisco now has an estimated 24.4% of the blade server market, behind only H-P's 43.7%.
May. 23, 2014, 6:43 PM
- IBM will stop selling NetApp (NTAP) storage hardware offered under the N Series label on May 27, per an internal memo picked up by Bloomberg.
- As it is, NetApp's OEM revenue (heavily dependent on IBM) fell 34% Y/Y in the April quarter to $109.8M (7% of total revenue).
- IBM's efforts to emphasize its own hardware played a role, as did Big Blue's competitive struggles - the company's total storage system sales fell 23% Y/Y in Q1, and IDC thinks its industry share fell 200 bps Y/Y in Q4 to 14%.
- On the FQ4 CC (transcript), CFO Nicholas Noviello forecast NetApp will see its OEM business decline "up to 40%" in FY15 (ends April '15). The company's branded revenue (93% of total in FQ4) is expected to grow at a mid-single digit rate.
- CEO Tom Georgens noted OEM sales include not just the N Series, but also sales of E-Series systems (high-performance SAN), which (OEM or otherwise) have been growing as a % of NetApp's revenue. He also insisted NetApp is "firmly positioned" with OEMs not named IBM.
- Previous: IBM to stop selling NetApp gear
May. 23, 2014, 3:29 PM| 1 Comment
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