IBM moves more into software

Hardware loses too much money

Big Blue says that it is planning to derive half of its profits from software and double its revenues in emerging markets to $9bn by the end of the decade.

According to the FT this serves to underline IBM’s strategy of moving further away from old-style hardware and decreasing its reliance on its large technology services arm by focusing on the high-margin market for corporate software.

Sam Palmisano, IBM’s chief executive, told the Financial Times said that he did not think that this would mean that the company was headed on collision course with Microsoft, Oracle and SAP.

He said that it is going after the thousand of other [companies] in this very fragmented software space.”

It wants to focus on integrated “stacks” of software that operate at every level of a company’s system in particular “middleware” that lies inside a corporate information technology system.

More here.