IBM said on Wednesday that it will spend $20bn on acquisitions over the next five years as it reaches for $20 EPS by 2015. Big Blue may need some new products, as the FT’s Lex column writes that the company may struggle to hit its ambitious new targets by relying on internal growth alone.
The question, however, is how much further profitability can be improved for a company unlikely to grow sales rapidly. IBM can tout the benefits of automating processes that currently require human interaction, and an improving economic environment should also help to improve consulting margins for the next two years. But operating margins of 15 per cent in outsourcing and consulting are already better than its US and European competitors. Read more
IBM’s promise five years ago to release 500 of its patents to the open source world was a milestone in Big Blue’s support for community-developed software.
So the news that it now plans to assert its legal rights in the case of at least two of those patents could mark an unfortunate watershed. And, to borrow an accusation often directed at arch-rival Microsoft, it is certain to sow FUD in open source circles.
The apparent inconsistency has been unearthed by European open source advocate Florian Mueller, who recently led the quixotic and ultimately unsuccessful effort to persuade Brussels to prevent Oracle from assuming control of MySQL when it bought Sun. Read more
Android phones loomed large at the CTIA show in San Diego this week, while the FCC chairman made the trip to the West Coast to warn the wireless industry’s convention of a looming spectrum crisis.
AT&T and others blamed heavy-duty data users and smartphones like the iPhone for a 5,000 per cent increase in data traffic over three years.
It has also been a big week for antitrust cases, as Europe finally ended its battle with Microsoft and the US began one with IBM.
We discussed all of this and more in our weekly FT techtalk – a live, multimedia chat with the FT’s tech correspondents. Read the transcript below and join us again next week – at 0800 Pacific time (1500GMT, 1600BST) here on Friday. Read more
As the Department of Justice gets further along with its investigation into how IBM maintains its dominance of the mainframe market, Lacy Edwards is certainly someone it will want to talk to.
Mr Edwards is the boss of Neon Enterprise Software, a small Texas company that is trying to make a living around the edges of the mainframe business.
Big Blue, however, is having none of it. It has written to some of Neon’s customers warning them that if they buy the company’s software, they could be in breach of their licences from IBM – even though it confesses it has yet to get a close look at Neon’s technology.
Does that sound like a case of FUD, designed to scare customers away from a rival’s product? That’s certainly the way Mr Edwards sees it. Read more
Due to the enormous cost and technology involved, less than a dozen people have had their DNA fully decoded, or “sequenced”, to date.
But IBM has come up with a method that could make this affordable for everyone – DNA sequencing could be more than a million times cheaper using chips with holes just three billionths of a metre wide, it says. Read more
It is perhaps with good reason that Larry Ellison does not speak in public that often. Whenever he does, the famously bombastic Oracle chief executive seems certain to trash his rivals, make bold predictions about Oracle’s future, and wander off topic.
Last night at a meeting of the Churchill Club, Mr Ellison said that Sun Microsystems was losing $100m a month as European regulators scrutinise Oracle’s proposed takeover of the struggling hardware maker.
On the economy, Mr Ellison said it would be at least another five years before the US begins to recover. He said it would not be a V shaped recovery with a sharp rebound, or a W shaped recovery with a double dip, or a U shaped recovery with a pause before an uptick, but an L shaped recovery — “down and not coming back up.” Read more