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IBM In Talks To Sell x86 Server Business To Lenovo
FrankPoole writes "According to CRN, IBM is in serious negotiations to sell its low-end x86 server business to Lenovo, which is looking to grow its server revenue. If the deal goes though, it will be the second time in eight years that Big Blue has exited a major hardware business and sold the operation to Lenovo. IBM sold its PC business to Chinese computer maker in 2005."
Lower overall revenues for higher profit margins? Smells like an MBA.
The summary should probably also mention that IBM sold off their entire storage division to Hitachi...
Margins are pretty tight in that business. They'll do much better stcking to their mainframe business charging ridiculous prices for MIPS to customers that can't afford the cost of migrating.
They've still got System Z mainframe line, and I can't see them selling that business unit off, but they ought to just drop the M and call themselves 'International Business'.
That's it, boys! Sell all that you own to the Chinese so you might have another decade of living the high life while doing nothing to earn it.
All that Western civilisation collectively worked on in the past 200 or so years has been given away to the Chinese for peanuts so we can sit on our collective asses and do nothing for about 20-30 years. Do you think that China will be paying us royalties once they figure out how to make a Core i7 processor themselves? F**k no, experience should tell you better.
Thats it. People in the "west" doing nothing of value or interest while thinking highly of themselves while all the real work and all the production has moved to China years ago.
When IBM decides to throw away its garbage, Lenovo will come begging
Muchas Gracias, Señor Edward Snowden !
If how Lenovo shat all over the ThinkPad line is any indication, you'll be sorry if you don't abandon ship now.
You sir are a genius! How could no one in any of those huge companies with thousands of attorneys and accountants come up with your idea? Please give me your contact information so I can warn them of their impending errors.
Only the State obtains its revenue by coercion. - Murray Rothbard
last I heard anyone doing real (read: not sales) work was being outsourced to whatever country was cheapest at the time. Why would I bother hiring IBM to do that when I can do it myself?
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A quick buck, or a quick death in a dying market?
Well said! IBM might not be the giants they once were but they're still pretty clued up. They sold off Thinkpad to Leveno and it's pretty clear now that the PC* market is dying.
The server market may well be about to choke it with cloud servers becoming so popular (AWS and whatnort). It doesn't seem sensible for a company of IBM's size to hold on to a market that is fast becoming a niece market.
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*I use "PC market" to mean "desktop/laptop market"... I hate it how Apple commandeered the term PC as if it somehow doesn't apply to Macs
What do you mean, "still"? I imagine most people are using them. Why? Because they're cheap and, most importantly, standardized.
I'll admit, I'm a big fax of Unix, but we decommissioned our last pSeries server a couple of years ago. The last straw was when we tried to add some additional disk space to the machine. Our distributor wanted about $25,000. After a little research, I discovered we could get a whole new x86 server with twice the disk space for less than $18,000. I'm pretty sure it was more powerful than the pSeries system. too. For the price of an IBM pSeries or iSeries machine, you can get a couple of x86 machines and use the second one for a backup.
Also, when you're dealing with IBM, you're locked into IBM. I suppose I'm not surprised that you can't just drop any old PCI card into an IBM system and expect it to work, but very few non-IBM SCSI peripherals worked with the system, either.
I hated to give up on IBM, but they're just too difficult to work with, any more.
Sit, Ubuntu, sit. Good dog.
the majority of first world economies is driven by the services sector... because first world consumers are fat and lazy and will quite happily pay for the convenience of having someone else do something for them, especially those who pay with government welfare (apparently over a third of americans rely on some form of government benefits)
i guess "useful" depends on your perspective though
US's comparative advantage is bull$hiting, not cranking out cheap commodity widgets, and there is more room for bull$hitting in services. ...until China realizes there is a bull$hitting gap, catches up, and sticks Vietnam or S. Africa with the hardware grind.
Table-ized A.I.
When home built gaming rig range from $600 systems to $4000 6-core Intel i7 with up to three GPU boards in SLI/Crossfire configurations, corporate customers are looking at cloud computing services to centralize heavy computing power and protect proprietary algorithms, is there any future for low-end corporate PC's?
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one word... cheap
ISS
i'm assuming you're not referring to one particularly large piece of orbiting space junk
The article should read the low end of the x86 business. IBM has already picked over the best parts of System X and moved them into PureSystems and has also started co-designing x86 server hardware with Hitachi for PureSystems. So they are going to be focusing on integrated server, networking, and storage plays instead of just plain standalone servers. Really trying to mimic the success EMC and NetApp have had partnering with Cisco and their UCS platform.
...will no longer sell any business machines. Interesting.
Who here is still using the x86 in their server farms? I'm interested in hearing why.
Because Windows only runs on x86, and once I've built up my VMWare or HyperV infrastructure to run the Windows side, why use a completely different processor architecture for the non-windows servers?
They don't have a major refresh every year, years with refreshes appear to have crazy year to year growth followed by a year of apparent sharp decrease. One 'bad' year is not unexpected if preceded or succeeded by a certain event on their roadmap.
XML is like violence. If it doesn't solve the problem, use more.
Being as the intellistations and some intelliservers were already done by lenovo, the deal won't be noticed by many.
Damn_registrars has no butt-hole. Damn_registrars has no use for a butt-hole.
My only notebooks brand/model is ThinkPad. Now, with Lenovo has done to ThinkPad, I have no choice but to find other brand instead. My preferred server brand was also IBM. If the history repeats itself, I guest I have to find other brand of server.
High school computer labs . . .
"Think about how stupid the average person is. Now, realise that half of them are dumber than that." - George Carlin
I think that IBM for a long time has been the same type of 'walled garden' that Apple was famous for. It's a whole lot easier to ensure the stability of your systems when you have had the opportunity to test every single hardware and software combination that you'll allow to function on your machine. Customers pay a premium for that type of testing, even if it limits their options.
"Think about how stupid the average person is. Now, realise that half of them are dumber than that." - George Carlin
IBM sold them a division that builds commodity hardware. You know, the same shit you can get from, Dell, HP, Supermicro, ASUS, and so on. They just assemble tech bought form other companies. Now that isn't worthless, people buy a lot of servers, but it isn't something hard to figure out.
They didn't sell their processor division, which doesn't make i7s anyhow, that's Intel.
In terms of making their own i7, well ok, good luck. IP issues aside (they don't have an x86 or x64 license like AMD does) there's the whole thing that designing a processor is pretty hard. China decided they needed their own, home grown, processor, and by "home grown" they mean "used MIPS architecture because designing an architecture is hard." So they've thus far managed to produce a MIPS64 processor, that they don't fab (STMicro fabs it for them, they are European) that runs at 1GHz on a 65nm process.
That might be impressive (well minus the using other people's architecture thing, and the fab thing) except that Intel is making 4GHz processors on a 22nm process right now, and has a 14nm fab that is getting ready for pre-production in Arizona (will be up fully next year).
This idea you have that the US does nothing, particularly nothing high tech, is badly misguided. You might want to do a bit more research and find out all the things it does do. Processors would be a big one, being that not only is Intel a US company but most of its fabs are in the US but it is hardly the only one.
Not speaking to the business wisdom of IBM's move (IBM has been making bad decisions for awhile IMO) but stop acting like this is some super secret tech they sold. This is commodity manufacturing. For that matter it is commodity manufacturing that Lenovo already does some of. They make servers, just not many of them. This is an effort to grow their market quickly.
Look, rometty would do well just to allow the Chinese gov. to buy them, rather than piece this out this way. They have nothing to replace it with, and they are giving away all of their IP.
GE, HP, Sun, Dell, etc were once top notch companies ran by engineers or business ppl who actually care about their companies.
Now, they are ran by MBA's that destroy the companies just so that they can get a fast buck.
So sad.
I prefer the "u" in honour as it seems to be missing these days.
That they sell to go with the servers? All three of those items are high margin and more than make up for the lack of margin on the servers themselves. How long is it going to take Lenovo to start selling enterprise storage or networking gear? They had better get some kind of agreement from lenovo that they won't sell gear in any of those categories for the next decade or two.
I can't really see people calling up lenovo and ordering a bunch of servers, and then calling up IBM and ordering storage. If nothing else they are going to call up netapp, EMC and Snoracle as well.
Maybe IBM doesn't care about the "low end" stuff people are connecting to their x86 servers. Sell a few less DS3500s milk the DS8k customers some more.
The problem is that "low end" x86 hardware is slowly but surely eating into what remains of the unix/midrange "server" market. Sure a couple customers here and there buy a mainframe and run zlinux on a couple IFL's they basically get for free after buying the mainframe. But in the end, can they support a business on such a tiny portion of the market? Even major mainframe customers like American Airlines have publicly stated they are moving away from the mainframe.
I suspect they will continue as they have for the last decade, selling pieces of the company, moving all the engineering to cheap labor countries, and charging their existing customers a heavy ransom for the privilege. But at this point in time IBM is beginning to look like Sun circa 2001.
The Thinkpads that IBM designed (hell a lot of things that IBM designed) were high water marks for the industry. Lenovo assembled them but they have not shown me that they, as a company, are anymore committed to producing such a high quality product now that they are responsible for the brand than are any of the other mainland shit companies.
I turned to HP for a while, they had something worth buying for a bit, but I'm at a loss for my next round.
I'm seeing a lot of shit right now. Kinda hoping that Mr Dell can pull off his buyback and make something worth buying.
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If the Bible was like Wikipedia, literal believers would all be aware that Jews don't need to be saved. That killing isn't a sin. That Paul was a misogynistic self-hating homosexual. Not hating - just saying that Christianity is a minority belief and that Wikipedia is an open system to everyone else that is aware of external ideas and evaluations.
"The Adobe Updater must update itself before it can check for updates. Would you like to update the Adobe Updater now?"
Leaving all the people that did all those previous things of interest in the west saying, "WTF ?"
Of course I grew up with the "knowledge" that Japan's cheap wages were going to kill the west. But that didn't work out for them. I'm really interested in seeing how long China can keep their slave population in check.
"The Adobe Updater must update itself before it can check for updates. Would you like to update the Adobe Updater now?"
I had a M1 Carbine made by IBM for a while.
"The Adobe Updater must update itself before it can check for updates. Would you like to update the Adobe Updater now?"
we use 603e power PC's dropped that x86 garbage 15 years ago for the latest fad that no longer exists tyvm!
I'm currently in China and can tell you that you are very diluded if you think of everyone here as a slave. They will be able to keep it up because life in here is very cheap. So when you see what you would consider a crappy wage in the west, it turns out that is a lot of money here. Plus the high school system is one of the best in the world, at least in Shanghai, and free nonetheless. So I think you might want to take a trip here and see for yourself what's going on.
You know in China when you go to some nightclubs and restaurants, you will have people in the bathrooms that will handle you a towel, pour liquid soap in your hands, etc. People at every metro station with flags when you come out "directing traffic", as well as two or three cops telling you to put your bags in the x-ray machine but that almost everybody ignores. Literally hundreds of people cleaning the street in the morning with brooms made out bamboo sticks and leaves, and cleaning ladies that charge you $6.55 for two hours. I wouldn't say that the Chinese are lazy but I think having a big service industry is hardly an indicator of laziness or being fat for that matter.
Now when you compare the typical American diet to a Chinese diet, it is extremely easy to see where the problem is.
that's what happens when you have a socialist government
what sort of jobs do you think are becoming more prevalent in america? certainly not manufacturing
the only reason why its obvious in china is because they have more than 4 times the population of the united states so despite having huge production capacity, there are plenty of workers left over for the service sector (both government and private). also, you'll probably find that those jobs only exist in certain parts of large cities where fat lazy foreigners frequent.
Asians not only eat differently, but they have a different work ethic; with such a high population the competition for even menial jobs must be enormous so they work their asses off, whereas america is full of self righteous welfare dependent slobs.
When outages cost you millions of dollars per minute, you're willing to spend the money on having a well-tested walled garden. This isn't appropriate for every business case, but there are definitely those who need that level of reliability.
"I disapprove of what you say, but I will defend to the death your right to say it."
- Evelyn Beatrice Hall
A car license in Shanghai would cost you $10k, a crappy Chinese designed car would cost $10k and is full of flaws and may cause cancer due to the materials used, if you want imported car it starts with $30k. Apartment price is probably $5k to $10k per square meter, there's no rent control so rent is increasing every year. Yes if you buy food and wares from noname vendors you can save a few bucks, but do you know what it will do to your health in the future? Also education, it is free if you can accept any school no matter the quality. If on the other hand you want your children to have a chance to go to a good university, you probably want your child to go to a good school, which would cost $10k to $20k per year.
So to sum it up, if you don't care quality then living in China is cheap, but Chinese is not stupid, they want quality life as everyone else, this is why wage of Chinese labor is increasing fast (inflation is also a factor, but that's another topic).
Well, I am in Shanghai and believe me, this feels like anything but socialism. The only indication of the political system I could see was with the great firewall thing and even that is easily bypassed with a vpn.
The cleaning ladies or ayis, as they are called here, are not only used by fat lazy foreigners but by a lot of Chinese too. Remember that not all Chinese are poor and there are quite a bit of people here driving Ferraris and Lamborghinis.
From what I have seen and talking with my Chinese friends, they work like that is just because they are taught like that more than anything else. Understand that for them, high school is hell, where you need to study like mad to get into a good university. University is relaxed for them, and when they finally get a job, it's a walk in the park. I'm attending a good university here and after getting my major in the US, I can tell you that it's not that their education system is better, but they demand a lot of the student. Tons of homework, research, you name it. And for them that is easy so go figure. So that's why when they end up working in the US they think that we complain too much since everything is really easy.
The other thing is that being here, you don't truly feel the high population like say, being in Times Square. It is spread out if you will, with good malls and services in every district. But jobs in here are the same as everywhere else, if anything there are a lot of opportunities right now because of the booming economy. For instance, if you are Chinese and know English very well it is almost guaranteed that you will get a job. If you know Spanish, German or some other European language your luck is kind of the same. As for foreigners, China is awesome, you get even better deals than the local Chinese.
IBM X-Series are fantastically well-built systems. I work with a lot of Fortune 100 companies and most datacenters have either HP or IBM for their tier-1 applications. The problem is that as apps become more stateless and more capable of tolerating downtime in different layers, the robustness, stability and even manageability of the server platform becomes less relevant. I think that's the reason why I'm starting to see a lot of low-end or even custom built 1U boxes and blades pop up in datacenters that otherwise would have purchased IBM or HP.
I think IBM is leaving the space because they see that trend and they can't effectively compete purely on price given their cost structure, while Lenovo has a better chance at making that happen. It's a simple business decision.
High school computer labs . . .
They should head back to being thin clients on a server running a bunch of virtuals - one per kid.
Easier deployment. Easier monitoring. Central backup.
Lets the kids customise their setup and then log in anywhere and get their machine.
Should cut power bills too.
I'm guessing that wasn't on their radar screen...
That would certainly be a better option, and not even an expensive one considering how low the prices have fallen for what is actually very powerful hardware today. The problem is the expertise necessary to do it right is more expensive than the hardware and licensing, and if it's done wrong no one will want to use it. It would be good if there were an inexpensive pre-configured solution that could be plugged into the network and after walking through a wizard is ready (there may be such a thing, I've never researched it). Qualified IT staff is expensive, and school budgets are being squeezed worse every year.
"Think about how stupid the average person is. Now, realise that half of them are dumber than that." - George Carlin
1. What's better in China than the US or other western countries? Cheap housing/cars/gas? Good quality in consumer products? Safer food? Clean air/water? From my point of view, on every basic human necessity, China lacks behind the US and other western countries.
2. If China is so good, why there're very few US citizens immigrating to China, while there're tons of Chinese waiting to immigrate to the USA? Note I'm talking about immigration, not tourists or short term stays, but moving to the country for good. This will tell you which country is really good.
When outages cost you millions of dollars per minute, you're willing to spend the money on having a well-tested walled garden
google might beg to differ
This isn't appropriate for every business case, but there are definitely those who need that level of reliability.
reliability is best achieved with redundancy... you can spend big bucks on something that is supposed to be reliable, but reliability of any component is only based on past performance and is by no means guaranteed
once I've built up my VMWare or HyperV infrastructure to run the Windows side
you're doing it wrong
who'd ever need more than 640k of memory
nobody should need more than 640k of memory
unfortunately god invented microsoft