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IBM Promotes Linux Partners to Highest Tier
Anonymous Anonmenon writes "Big Blue was at it again today after it promoted the two leading commercial Linux distributions to the highest level tier of its Strategic Alliance Program. From the article: '[The Strategic Alliance Program] is designed to allow independent software vendors (ISV) work through one point of contact within IBM as opposed to navigating through several relationships with representatives from different divisions. The move was billed by executives from all companies as a means to make it simpler for clients to acquire open standards-based Linux hardware, software, and services through integrated sales, distribution and services channels.' The announcement was also heavy on the Java side, with both Red Hat and Novell pledging a 'reinforced commitment' to the Java developer community and J2EE."
The The announcement was also heavy on the Java side, with both Red Hat and Novell pledging a 'reinforced commitment' to the Java developer community and J2EE.
IBM is slipping. Don't they know that Java is so 90's?Hmm...I'm not quite sure how you'd decide that. According to IBM's latest 10-Q report, in the quarter ending 30 Sept. 2005, their software division had revenues of a little over 3.8 billion US dollars, and costs of 483 million US dollars. By contrast, their hardware division had revenues of 5.12 billion dollars, but costs of 3.2 billion dollars. IOW, they're showing a gross quarterly profit of about 3.3 billion dollars from software, and only about 1.9 billion from hardware. Looked at on a percentage basis, software looks even better for them: it constitutes almost 18% of their revenues, but only about 3% of their costs.
Their highest revenue division is services -- but even with the largest revenues, this still has slightly lower profits than their software (about 300 million less per quarter than software).
As far as sinking goes: their revenue from software is up about 200 million dollars per quarter from a year ago, while their costs are up only about 20 million dollars a quarter. IOW, their total sales are growing, and they're getting better profit margins too!
Just for comparison, Microsoft's latest 10-Q [warning: Word format, of course] shows they have about 9.6 billion in quarterly revenues (total) and costs of about 6.3 billion, for a gross profit of a bit under 2.6 billion. IOW, IBM's software division produces more profit than Microsoft!
In fairness, that comparison probably isn't entirely accurate: in Microsoft's case, it's taking essentially all expenses into account, including things like R&D (1.5 billion dollars a quarter!) which probably aren't accounted for on a divisional basis at IBM (though I didn't dig through things enough to be sure about that).
The universe is a figment of its own imagination.