Friday, October 24, 2014

Should IBM Break Up? | Re/code

Breaking up is hard to do; simpler to periodically dump lackluster businesses and move on

"Hardware is primarily comprised of the 50-year-old mainframe business and the high-end Unix server business. IBM has long dominated the mainframe business, but that’s like saying it’s a big fish in a lake that’s steadily drying up. And the Unix server business — where IBM competes with Oracle and HP — is on a long, slow death march to zero.

The more likely long-term scenario is a familiar pattern of shedding assets. So far this year it has rid itself of two businesses accounting for $7 billion in revenue: The commodity server business went to Lenovo in January, and this week it announced that it is paying GlobalFoundries $1.5 billion to take its chip-manufacturing operation off its hands. Last year, IBM sold it off its $1.2 billion customer service business to Synnex. Other notable divestitures include the sale of the PC business to Lenovo in 2004."
Should IBM Break Up? | Re/code
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