Wednesday, May 14, 2008

FT.com / Companies / IT - Small matter of the Big Blue challenge

A timely Financial Times reality check

For IBM, the king of the IT services business, imitation is the sincerest form of flattery. But if Hewlett-Packard thinks its purchase of EDS will immediately put it toe-to-toe with the market leader, IBM’s own long and difficult ride in services should make it think again.

IBM Global Services, which accounts for more than half of the Big Blue’s revenues, has rebounded to become the main driver of the company’s earnings since the middle of last year. After a period of negligible growth, it has taken a radical restructuring and new leadership to revive the business, lifting growth back to 9 per cent in the first quarter even before the benefit of currency fluctuations.

FT.com / Companies / IT - Small matter of the Big Blue challenge

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