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IBM as a company barely makes sense at all at this point. They are a very large and a former tech company that mostly coasts along on doing expensive consulting
by jillesvangurp 4y ago
IBM as a company barely makes sense at all at this point. They are a very large and a former tech company that mostly coasts along on doing expensive consulting projects around me-too clones of things that other people have invented just so they can still pretend to be a tech company. So you can do things with AI, cloud, and databases with them. But they aren't really leaders in any of that for a long time. And having been exposed to some of that stuff, they aren't very good at it even but they can still get some things done. They still have lots of ancient tech from last century that they support of course. But mostly a new company starting their business today would have very little reason to engage with IBM on anything. There's very little that they do that you can't get cheaper and better elsewhere.
So, IBM using this opportunity to cut down their own org tree a bit more and "replace it with AI" (or simply drop some people) is not unexpected. Because consulting related to doing exactly that is probably what they'll be selling a lot for the next few years. Basically, as world + dog is trying to figure out how to fit AI into their businesses, consulting related to that is going to be booming. And IBM is a consulting company. A lot of their previous efforts are actually powering the backoffice of course. So now that AI is going to replace all of that, that basically means there is going to be a lot of consulting happening as to how that would work. So that's a good business opportunity.
- aflag 4y agoThat's a very cynical view. It might be true, but I hardly think they were just waiting for the perfect opportunity. If it made business sense before, they would've already been halting their hiring.
- wesapien 4y agoA lot of corporations are replacing humans jobs instead of enhancing them with new tech like what the tech gurus say during their TED talks about the benefits of X tech. Another reason to flip cars.
- qualudeheart 4y agoSmart Money flips houses. The Smartest Money flips GPUs.
- jillesvangurp 4y agoThey've been going through cycles of doing that for many years. Their head count has dropped by about a third in the last decade. It peaked at 460K people in 2012 and they are now closer to 340K. So -120K people in ten years. https://www.macrotrends.net/stocks/charts/IBM/ibm/number-of-employees https://www.macrotrends.net/stocks/charts/IBM/ibm/number-of-... What they just announced is a relatively minor round.
- bonzini 4y agoThat source doesn't seem too accurate, 2020 is shown as a decrease but it's when RH was acquired, and 2021 or 2022 should have had a -90K from the Kyndryl spin off. Also I am not sure if the 2014 decrease is also related to the formation of GlobalFoundries but I couldn't right away find news about a -80K layoff that year.
- realusername 4y agoThe irony of that is they are probably going to use AI services of competitors to do that despite pioneering the marketing on it for years, thus closing the loop.
- anonylizard 4y agoThere's nothing ironic about it. They invested only in the marketing of AI, but not in the serious R&D of it, pretty sure internally they never believed in their own AIs. Plus they got the publicity benefit from Watson, which is important for a consulting company.
- HlessClaudesman 4y agoIBM had / has an army of sales types running around trying to insert Watson into health care, always reminded me of the Dick Jones character from Robocop trying to pedal the fundamentally flawed ED-209: "I had a guaranteed military sale with ED209! Renovation program! Spare parts for 25 years! Who cares if it worked or not!" Such an ethically questionable decision, trying to push unproven / non-functional tech into life or death decision making.
- dagw 4y agotrying to insert Watson into health care They were trying to insert Watson into everything. I used to work at a company that worked with building management systems and we had Watson sales people all over our senior managers trying to get 'collaboration' projects going.
- ThenAsNow 4y agoNot usually in this habit, but really needed to commend you bringing in not only Robocop, not just stopping with Dick Jones, but including his quote as well. This really made my day. Signed, A fan of Robocop as dystopic corporatocracy preview
- deleted 4y ago[deleted]
- pulse7 4y agoUnlike many other tech companies they provide unprecedented backwards compatibility which makes a very solid foundation for their customers... There don't do "automatic-updates" which break software like Microsoft is doing with Windows...
- Frost1x 4y agoKeep in mind that a lot of B2B transaction use in tech is about passing responsibility and liability. Executive or director somewhere has to solve this internal problem. IBM claims they solve it and provide some degree of guarantee. You're now able to pass that problem, responsibility, and liability off by pointing to the contract and saying legal pursuit is an option. Obviously this strategy isn't great from a business perspective. If the problem is actually critical to the business function, simply having a hired scapegoat to complain and point at doesn't help you get past that problem. If you're this massive inertial machine and the problem is to some degree artificial and a waste of internal resources but someone thinks it isn't, having someone like IBM on the hook gives credibility to the argument that they did their due diligence to solve the problem. Business at scale has a lot of childish fingerpointing. "No one ever got fired for hiring/buying IBM" as the saying goes.
- roncesvalles 4y agoIBM got to this point for a very basic reason - they don't pay well.
- manicennui 4y agoYou have no idea what you are talking about. IBM does more cutting edge research than the entire HN bubble combined. Hard research like materials science and semiconductors. Consulting is less than a third of their revenue and regardless of how you feel about consulting, it seems kind of idiotic to claim that this "barely makes sense at all at this point". Are the only companies that make sense the ones that work on fad bullshit that makes the front page of HN?
- Upvoter33 4y agoI think the true thing is that IBM has ceased to be a leader in Computer Science. They used to be! But they gave that up long ago, and have resorted to various publicity stunts (e.g., remember Jeopardy?). But sure, they may be a leader in materials and semiconductors (though honestly I have no idea, that's not my space).
- sgt101 4y ago[flagged]
- dlevine 4y ago[flagged]
- _ea1k 4y agoPeople mock them for that Jeopardy thing, but that would have been the perfect first move to offering something like Watson as a service. They could have built it over time to offer real assistance to knowledge workers with a real revenue stream. But that would have required vision and foresight.
- rst 4y agoIBM is a bunch of businesses, some of which still likely make sense -- their mainframe hardware line (S/360 successors, currently branded as z/System), and associated products, are still actively developed, and very likely profitable, considered on their own. But that may not be enough to carry the rest of the business.
- deleted 4y ago[deleted]
- AlbertCory 4y agoIt was always the case that IBM stuff was way overpriced compared to alternatives but a senior manager who bought it could rest easy, knowing that if he called and complained, they'd be right on it. Even 10 years in the future, they'd be right on it. That's worth something to some people, who really don't give a shit about technology and just want the problem solved.
- t43562 4y agoSoftware for people who don't care about software! Personally I think if you don't care about something it will be bad. This is great for small companies and startups - if the bigger ones did things properly how could anyone compete?
- AlbertCory 4y agoExactly! They're creating a Quality Umbrella. "if you don't care about something it will be bad" -- maybe to you. To them, it's not causing any problems that they care about.
- t43562 4y agoNot to me but to the company/institution and all its users. Of course the person who arranged it doesn't care because they are in a situation where they are immune to those particular consequences. e.g. they never use the system and nor do any of their senior managers so they can dismiss all complaints and report on how much money they saved. If one innocently wants to do what's right for the institution, the shareholders or the taxpayers, one has to care. Its usually a tactical mistake to care of course - people who don't have a lot more freedom of action.
- flavius29663 4y agoexactly. As I heard, google can be pretty bad at support, for example. Better tech does not mean better experience overall
- swexbe 4y agoNow when they call I guess they'll be directed towards the AI chat bot helpline :)
- hinkley 4y agoIBM’s MO now, especially for the Global Services arm, is Dazzle Them With Bullshit. They come up with solutions so baroque that it’s exhausting even to hear them talk about it. So you just hire more IGS people to take care of the problems they created. It’s a racket, based on them literally not making sense.
- 1970-01-01 4y agoIBM is a company in the same way Hawaii is a state. There's a lot of great of stuff going on, most of it is done "at the other island" and a lot of the stuff will be consumed by a live volcano without anyone really noticing.
- selimthegrim 4y agoSo going by the flag it’s also the East India company is what you’re saying.
- sys_64738 4y agoIBM lost its way in the 90s and was overrun by startups which became massive. Nobody wants to work for IBM as it's kiss of death to your CV.
- beachy 4y ago> IBM as a company barely makes sense at all at this point. I started my career at IBM in the 1980s. My dad worked there before me. It's impossible to convey how much hubris existed in the company then, at the peak of the "No-one ever got fired for buying IBM" days. IBM was a god. The company had never laid off a single employee. The talk was that the R&D divisions had multiple generations of innovative tech up their sleeves and if any competitor ever got close, well they'd just pop something out like from a vending machine to kick their ass. I believed it. It became obvious when the company started losing the PC market that things weren't actually that rosey at all, and there were serious issues. Later it became obvious that the company was turning into a consulting company instead of a technology company and the glory days were well over. Nothing's changed since then. Things have only gone from bad from worse for IBM. My point - nothing really but disagreement with this observation. IBM still makes sense, as a dying beast but with customers that can still be milked. As long as those customers can be mikled, IBM will continue to make sense.
- anukin 4y agoDamn it feels so much like Apple now
- asdfman123 4y agoAnd Google
- jb1991 4y agoApple Silicon is one of the most revolutionary new technologies in awhile. Apple has a long way to go before it is at IBM’s status.
- Analemma_ 4y ago> The talk was that the R&D divisions had multiple generations of innovative tech up their sleeves and if any competitor ever got close, well they'd just pop something out like from a vending machine to kick their ass. It's amazing that this story just keeps popping up over and over. People also said this about Intel (nope, 10nm was a total wash and during that time AMD and ARM started eating their lunch) and Google (no, there is no secret Google lab with the "good AI", it's just Bard and it sucks compared to GPT-4).
- gregvab 4y agoWorked at IBM back in 2010. It was the second most valuable company in the world at that time. I left and now the rank has slipped to 86. Sorry.