IBM Spins Down

beggs writes "IBM and Hitachi have signed an agreement which will take IBM out of the hard drive market in three years. This press release on IBM's web site gives some details of the deal. 18,000 IBM employees and all their hard drive related patents will join about 6,000 Hitachi employees to form a new company that will be a subsidiary of Hitachi. Sad to see big blue out of the hard drive business, they have made a lot of contributions to computing." We did a story when they announced their plans back in April.

Comments

Re:Maybe?

[forged]

Computer world has an article from earlier last month, which has some insight into the issue.

Re:Moving production to Asia?

[proj_2501]

All that will happen is 24,000 or so people will be freed up to do something else in our economy.

Yup, like suck up unemployment and Social Security money. It's not exactly all that easy to find a tech job once you're over 40.

The change occurred when San Jose bit the dust

[StringBlade]

Apparently IBM San Jose was told time and again to reduce their costs but never did, so they lost the HD bid to IBM Japan. Japan developed the Deskstar series "cheaper and faster". And down comes IBM's HD division.

oops...sorry about that

Not a Huge Surprise..

[lionchild]

I suppose this shouldn't be a huge surprise. Being an ex-IBMer, I can empathsize with the employees in the HDD division, I'm sure from their point of view, it sucks rocks. I used to be in the service division, back when they cut service off like a gangreen limb and started calling us Technology Service Solutions (TSS) as part of a Joint Venture with Kodak.

I suppose the point of my story is that even several years ago, IBM has been looking for the places it can cut the fat, increase the profits. It's what all business folk do. And IBM has done their share of silly business moves that looked like good ideas, (*cough* TSS *cough*). And if it's doesn't work out, those who endure, will get folded back in and things could very well be better than before.

IBM does alot of drive business. How many times have you opened up your Apple G3 or G4, only to find the IBM HDD inside? Or how about your laptop? How many folks have upgraded their laptop HDD's with IBM drives? If IBM is getting out of the HDD business, there must be something in R&D that's pretty darn cool, or IBM's losing their competative edge.