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Big Blue suits will share technology with the Chinese

by on24 March 2015

China Blue 

CEO Virginia Rometty has said that the ever shrinking Big Blue will share technology with Chinese firms and will actively help build China's industry.

Talking in Beijing Rometty was setting out her cunning plan for winning over the Chinese manderines who have got the pip with IBM,

The Chinese are leaning on foreign tech companies to stop using its country as a sweatshop for cheap labour and a huge market for their goods. The want the westerners to stop shutting out local producers and help develop the local technology industry.

Rometty said at the China Development Forum, IBM must help China build its IT industry rather than viewing the country solely as a sales destination or manufacturing base,.

"If you're a country, as China is, of 1.3 billion people you would want an IT industry as well. I think some firms find that perhaps frightening. We, though, at IBM ... find that to be a great opportunity," she said.

Her comments are the clearest acknowledgements to date by a high-ranking foreign technology executive that companies must adopt a different tack if they are to continue in China amid growing political pressure.

Intel is another one which has seen the writing on the wall and is forming alliances with domestic operators, hoping a local partner will make it easier to operate in the increasingly tough environment for foreign businesses.

IBM's sales in China have stabilized after a sharp drop that began in the third quarter of 2013 following Snowden's revelations. The Armonk, New York-based company reported a 1 percent slide in revenue in China during the fourth quarter of 2014, compared with the prior year.

Biggish Blue's new approach allows Chinese companies to build everything from semiconductor chips and servers based on IBM architecture, to the software that runs on those machines.

Last week IBM announced that Suzhou PowerCore Technology will begin producing a version of IBM's Power8 chip to run on Chinese-made servers. Its POWER line of processors is often used for intensive calculations in financial services, where Chinese banks have been required by new government regulations to use more domestic vendors.

It had already announced a series of partnerships with Chinese vendors and now packages its database software with products from Inspur, a server hardware maker and IBM rival, and has also struck agreements with Youyou, a Beijing-based software firm.

Last modified on 24 March 2015
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