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IBM Looking To Sell Its Semiconductor Business
jfruh writes "Having already gotten out of the low-end server market, IBM appears to be trying to get out of the chip business as well. The company currently manufactures Power Architecture chips for its own use and for other customers. Big Blue wants to sell off its manufacturing operations, but will continue to design its own chips."
I thought IBM was able to leverage their detailed knowledge of their semiconductor processes to squeeze every bit of performance they can out of their Power architecture designs, and even tweak the processes to aid them. I doubt they will have enough volume for another company to do much of that unless they are willing to pay.
much of left-wing thought is a kind of playing with fire by people who don't even know that fire is hot - George Orwell
Nobody buys Playboy for the articles. They do it for the hot, nude women (sadly, sans grits). It just so happens that /. is exactly the same. No one reads /. for the articles. The articles were news two days ago. And no one reads /. for the summaries. The summaries are almost always wrong.
Everyone reads /. for the comments. The comments are the /. equivalent of Playboy's naked chicks, with one crucial difference. Without the gentlemen at Playboy, there will be no naked chicks to look at. The service they provide is, for the most part, finding women that will agree to pose nude for pictures, which they most graciously distribute to their readers.
But as for Slashdot -- the good people at Dice and their "editorial" team do diddly squat around here to generate content. The articles, old as they may be, are submitted by the users. The summaries, mistaken as they may be, are provided by the users, not by Timothy, Soulskill, et al. The comments, trollish as they may be, are written by the users.
/. is of the users, by the users, for the users. The only people at Dice who deserve their paycheck are the IT people. The rest of you -- what is it that you do for our benefit? Why the hell do we need you clowns? Your music's bad and you should feel bad!
Beta delenda est!
I know of IBM as a:
- Desktop PC manufacturer
- Server manufacturer
- Chip manufacturer
If they don't have those 3 things any more, then what are they? To my knowledge, IBM has some of the best fabs in the world. It's amazing to me that this is not part of their core business. This is... wow... just wow.
And yet another American innovator who actually built things is getting out of the business.
America has tied her fortunes to copyright, patents, and 'knowledge' workers -- while simultaneously mostly switching to H1Bs, corporations which don't actually do anything, and a complete loss of manufacturing.
America is becoming a country which is staking its real economy on virtual things, and is slowly losing capacity and competitiveness on the world stage.
Fix this shit now, or in 15 years there won't be any domestic jobs, skills, or point. If you continue on this current trend, the actual economy of the US will be completely gutted and propped up with things which look good on paper but really have no value.
Dice already said they need to redesign the beta. What more do you want from them, blood? So lay off with the immature "Waaaahhh...they aren't doing what I want them to."
IBM helped the Nazis with the punchcard technology used to keep track of prisoners in concentration camps during WWII:
http://en.wikipedia.org/wiki/I...
Sad really, IBM once stood for innovation and industry leadership. Now they're all about maximizing shareholder equity and other buzzwords that have nothing to do with being a leader. The board needs to fire most of the C level MBA shit-for-brains and hire some tech talent from within to re-motivate the company before it's too late.
Harrison's Postulate - "For every action there is an equal and opposite criticism"
NNNNNNNOOOOOOOOOOOOOOOOOOO!!!
GSD's motto: "Fuck the customers and provide service from a cornfield in Iowa"
Harrison's Postulate - "For every action there is an equal and opposite criticism"
They should make beta opt-in, instead of opt-out. For ALL users.
Plus, Dice thinks they can reach a broader audience.
It isn't going to happen this way...
We like slashdot because of the audience. Change the audience, and slashdot is over.
If Pandora's box is destined to be opened, *I* want to be the one to open it.
Selling hardware, semi conductors - moving from proprietary OSs to linux. Are they just going to be another consultancy group?
How is semiconductors not a core business for a company that still makes huge profits off mainframes and midranges?? Sure, keep design in house, but you'll lose the flexibility you have. Imagine your research division came up with an amazing new chip design they wanted to work on right away, but were told "Nope, it'll take 6 months to ramp up GlobalFoundries, TSMC, or whatever. Sorry."
The thing I really don't get (in general) is the way businesses feel like they can have no assets on their books and just run everything with a massive tower of multi-layer outsourcing. It doesn't make sense -- outsourcing something is never cheaper than doing it yourself. As soon as you do that ,you add in a layer of middlemen who need to get paid for doing a task which was previously cheap or "free with purchase of inhouse labor." It never works out. I guess I'll never be an MBA, because I don't get the accounting tricks that make a company appear profitable when they're wasting money on things they could do cheaper and better themselves.
For IBM's case, I do see what they're trying to do. Software is more profitable than hardware. But the problem is that IBM is/was a huge innovator in hardware and chips. They're one of the last US companies massive enough to support basic research that can improve those hardware innovations. IBM's software may be profitable, but I haven't seen anyone singing the praises of WebSphere or their Rational products lately. IBM also has a massive "services" division. I've had extremely good luck with the services people who service IBM hardware, but that's going away. So, we're left with the legendary crap outsourcing and offshoring stuff they do for large companies, and of course, "consulting." My experience with outsourced IT run by IBM is an ITIL nightmare of endless support tickets, revolving door engineers, meetings to plan meetings to plan the strategy for changes, etc.
It's kind of a shame if you ask me. I am just old enough to remember when IBM was as powerful as Microsoft was and as Apple is right now. They were able to command huge margins on everything they sold because it was backed up by a really good services team. People I know who worked for IBM "back in the day" tell me the corporate culture was weird, but employees never wanted for anything because they made so much money. (I also know people who worked for Sun and Digital who say the same thing.) In some ways, it would have been much nicer to work in the computer field during this "golden age of computing." I guess my main question is where the new hardware innovations will come from when you don't have a massive company and research group driving them.
IBM is primarily a professional services company. They've been evolving into that for years.
In other words - salesmen - selling other firms' products and arbitraging labor costs between the Third World and the Western World at a huge markup.
Same goes for the other big companies.
And it's funny, they're "International" when it suits them and when they need that government contract, they're all of a sudden an "American" company.
At least they built something.
Oh and you forget, IBM has sold to anybody and in some cases with the Nod of the US government. This includes the Shah of Iran but lots of US companies dealt with the Nazis (Ford, ITT, US Steel etc.) It was just good business back then.
Harrison's Postulate - "For every action there is an equal and opposite criticism"
So what? We could look into past generations of your family and find things just as bad. And that's family, not business. The same genes are in you today and will be in your kids tomorrow. You can't fire them and they don't retire.
Manufacturing left America because China et al are cheaper
Completely off topic and completely wrong. Manufacturing is very strong in America to the tune of about $2 Trillion per year and for every dollar spend in US manufacturing it results in an additional $1.32 to the economy. The US manufacturing sector by itself would be one of the ten largest economies in the world - approximately the same size as the entire GDP of Russia even without considering the multiplier effects. The US presently has about 1/5 of global manufacturing activity. Some products are not manufactured in the US anymore (mostly high labor content low margin products) but any claim that "manufacturing left America" is completely false.
The only way you're bringing manufacturing back...
Manufacturing never left. If you think it did then you have no idea what you are talking about.
Big Blue wants to sell off its manufacturing operations, but will continue to design its own chips.
As "will continue to design its own chips" is not a complete sentence, the comma before "but" is not appropriate.
01 Apr 2014: IBM (NYSE:IBM) International Business Machines Corporation (IBM) has changed back to it's original name, Computing-Tabulating-Recording Company (CTR) and will be selling off all post 1930 technology units to focus on it's core business of dial recorders, electric tabulating machines and time clocks.
--- Commission free trading & free stock up to $500 - use http://share.robinhood.com/kelvinp6
Dice already said they need to redesign the beta.
No, they didn't. They talk about "incremental improvements", which in this case is like jumping a chasm in multiple small steps.
The Beta needs to be redesigned, yes. A redesign happens from ground up. Or, to use the obligatory car analogy: no amount of tuning your Mazda Miata will make it replace a bus.
I am eagerly awaiting the day when Watson is capable enough to replace 93% of doctors and lawyers. What's good for the plebs is good for the elite, right?
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
posts are makes it annoying to read here in the last few days its gonna be quite nice to not see you here for 7 days.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
there is so much wrong with it (discussed on the mentioned anouncement page you mentioned), you cannot improve on something that is utterly broken in the first place
I guess my main question is where the new hardware innovations will come from when you don't have a massive company and research group driving them.
Did you ever consider that basic research is hard to justify in a cooperate environment? Hence, better left to public entities, as done in many countries.
I think that big companies splitting up is a good thing, they'll be able to focus their research and be much more agile.. Other companies,start-up, etc. will also be able to compete better if they can purchase services from independent chip manufacturers. There will be less dirty game where chip manufacturers say they won't produce your chip because they are own by a big company (say IBM) whom you're trying to compete with.
The free market works best when companies are fairly small. Otherwise companies can't fail without it having enormous impact on society. I for one applaud IBM for trying not to be too big to fail!
For IBM this also means that they can't shop around for manufacturers, instead of being bound to use their own. Flexibility is not worthless.
US companies are selling off hardware because they discovered that bullshit (AKA "consulting") is America's comparative advantage.
Table-ized A.I.
Patent Trolling Entity
I'll see your senator, and I'll raise you two judges.
Nothing on Slashdot sucks.
I'll see your senator, and I'll raise you two judges.
" We have work to do on four big areas: feature parity (especially for commenting); the overall UI, especially in terms of information density and headline scanning; plain old bugs; and, lastly, the need for a better framework for communicating about the How and the Why of this process. "
What is it about feature parity is it that you do not get? At least give them credit for trying. There is another way for Slashdot to die, it could die through doing the same old same old for the same old visitors.
And for a group of people who claim to be the voice of the industry in the trenches, a lot of carping seems to ignore plain business sense. If this site doesn't hold its own in a marketplace, it will go away just like every other product that fails to capture a decent return. You might not like putting it in those terms but you know it's true. Sites rarely exist for the mere enjoyment of its visitors. In the end, someone has to pay for it. The Slashdot crowd is the same crowd that will crucify government waste along the lines of, there's too few served to justify the expense.
Dice made it perfectly clear that, even after all the backlash, Classic will soon be gone:
Most importantly, we want you to know that Classic Slashdot isn't going away until we're confident that the new site is ready.
Dice ignores our complaints, while pretending to listen. Bitching and ruining every single discussion is the only option we have left.
And flat-out bailing, either for a while like the upcoming boycott week from the 10th to the 17th, or permanently.
How is semiconductors not a core business for a company that still makes huge profits off mainframes and midranges?
Probably because the biggest part of the value added by them is in the design, not the manufacturing. IBM does not appear to have any competitive advantage in semiconductor manufacturing plus their core business now is in services. Their mainframe business really is to some extent really just a hook for their services. It remains significantly profitable but some of the components in those mainframes have become commodities which means low margins.
Sure, keep design in house, but you'll lose the flexibility you have. Imagine your research division came up with an amazing new chip design they wanted to work on right away, but were told "Nope, it'll take 6 months to ramp up GlobalFoundries, TSMC, or whatever.
Why do you presume IBM could ramp up any faster? Just because they can do it themselves doesn't mean they automatically can do it any quicker or better. IBM has some pretty smart financial, strategy and manufacturing people working for them. I've met quite a few of them myself. I assure you that they have done the math on this and while it's possible they are making a mistake, they're pretty good at this sort of calculation.
The thing I really don't get (in general) is the way businesses feel like they can have no assets on their books and just run everything with a massive tower of multi-layer outsourcing
Because the only reason to keep something in house is if it provides you an economic advantage. You outsource when someone else can do it as well or better for less money. My company makes wire harnesses. Many of our customers are capable of making the products we supply them but because of the structure of our company and the assets we have we can produce a better product for less money. We specialize in wire harnesses and we're enough better at it that we can save them money AND make a profit doing it. If we couldn't do it better and cheaper then they should (and often do) produce the item in house.
I guess I'll never be an MBA, because I don't get the accounting tricks that make a company appear profitable when they're wasting money on things they could do cheaper and better themselves.
Nobody "is" a MBA. Some people have a MBA degree. You might accurately call someone an accountant or a manager or an engineer but calling someone "a MBA" is exactly equivalent to calling someone a Master of Mechanical Engineering. It's stupid if you actually think about it.
Look, I have degrees in both engineering and business. I'm a certified accountant and my day job is running a manufacturing company. There are cases where it makes sense to outsource something and cases where it makes sense to keep it in house. You are making a faulty assumption that it is always better to keep things in house and I can prove to you that that is frequently not true. Specialist companies can often make a component of a larger product better, faster and cheaper than a vertically integrated company. Not always but very often. Virtually all of manufacturing is based on this fact. The cost of vertical integration has to be offset by the ability to command larger margins due to that integration. \
Ford once tried doing a complete vertical integration in their River Rouge plant. They brought iron ore in one end and produced automobiles out the other end. Thing was that it failed because they didn't have sufficient economies of scale nor the domain expertise to realize the cost advantages needed to make it work. A company that specializes in making steel is probably going to be able to make steel cheaper and better than an assembly company like Ford.
I'll give you an example from my company. We make wire harnesses and one of the products our customer buys from us are sealed leads which
I know of IBM as a:
- Desktop PC manufacturer
- Server manufacturer
- Chip manufacturer
You're describing IBM as they existed 20 years ago. They haven't been primarily a manufacturing company for quite some time now. Technical and business services is the core of the company as it exists today. They still make some products (hardware and software) but they are high margin products with significant support requirements.
That is literally disgusting. Worst is how they place all comments in a box and label it User Engagement like it's a widget they added.
Sell all your product lines in order to raise profits to the maximum?
But Miata is the answer to everything! Just ask Jalopnik, who like Slashdot is owned by idiots (Gawker in this case) that insist on repeatedly pissing off their users by changing the site layout and commenting system.
Yes it's an anecdote! Were you expecting original research in a Slashdot comment?
This reminds me of an old bit in The Onion "Nike to Cease Manufacturing Products"
http://www.theonion.com/articl...
Big Blue might as well just liquidate and give the money back to the shareholders, they just don't care anymore.
IBM knew precisely what Hollerith was doing
Hollerith wasn't involved in that - he died in 1929. Otherwise you're spot on. Hollerith worked on punch cards and tabulating machines, and his stuff was used in the 1890 US census. The Hollerith code bore his name though, and that's what was tattooed on death camp prisoners.
Wow. That is the clearest indication I've seen yet that there is no chance they are going to back down on this. "User Engagement", my eye.
Thanks for the link.
What more do you want from them, blood?
Oh please don't give them ideas... they may come back with Slashdot Beta in Red.
It's pretty much stopped making 'stuff' and sells intangible services while snapping up other people's software companies and rebranding them. But services require too much linear labor input even at firesale prices in China so it's probably just as well that half the employees now are lawyers and accountants. Soon IBM will be a holding company for buying and selling intellectual property and that's pretty much it.
India Business Machines.
DEC used to make everything they sold: the chips, drives, displays, circuit boards, software, you name it. Eventually, for the sake of raising profits, they sold it all off part by part. Then they were absorbed by Compaq, which in turn was absorbed by HP. Today they're nothing but a memory. So who will ultimately buy IBM and when will they do it? It's now just a matter of time...
The Model F was better, at least for the keyswitch mechanism. They layout was awful though. The keyboard with the best layout is the Sun Type 5 (but the keyswitch mechanism there sucks).
Bush decided to reclassify fast food as manufacturers to hid the job losses last decade to China.
Since it would not surprise me if 1/3 of that is Mcdonalds alone that all fastfood joints make up most of that total.
I do not know of anything made here? All the big names in my city are all service, banking, marketing, and restaurant headquarter companies. The only thing produced a fish from the nearbye sea. It is not sustainable as it depends on other people spending. The problem is that goes out once it is spent. Producers keep making value in comparison which is why China is growing 10% annual.
http://saveie6.com/
Dice is pulling a Windows 8 Metro-forced-down-your-throat move. I would expect they would get similar market results.
There is another way for Slashdot to die, it could die through doing the same old same old for the same old visitors.
Eh, I think you still don't get it. Consider this: "There is another way for books to die, they could die through doing the same old same old for the same old readers." Yet, books have been around for thousands of years, because they work. They well-fulfill their intended purpose. Radio and movies and TV and online video haven't replaced books, and they never will.
Slashdot is like a book in that it has a simple function: allow people to have reasonably (or comparably) intelligent discussions about topics of interest in a reasonably efficient way. Slashdot needs a redesign in the same way that books need to be redesigned: it doesn't, and they don't. Minor changes can make it more efficient, and that would be great.
Basically, you're begging the question: who says Slashdot needs to change? Dice? How do they know? They just wasted some money on a site they didn't understand--that doesn't mean the site needs to change to suit their needs; that doesn't mean they need to change it to be like their other projects. They are the ones who need to change; they need to learn to understand what Slashdot is, not what they wish it would be.
"Those who consume the bulk of goods are those who make them. We must never forget this secret of our prosperity."
Bush decided to reclassify fast food as manufacturers to hid the job losses last decade to China.
Stop making nonsense up. Nothing of the sort happened and McDonalds is not and never has been classified as a manufacturer. Some of the products they purchase (food products) are manufactured but McDonalds themselves are not and never has been classified as a manufacturer.
I do not know of anything made here
Then you haven't actually bothered to look.