History of IBM

Some facts from IBM's history are included in separate articles:

• IBM Russia
• IBM financials
• Acquisitions and divestment of IBM assets
• Work and Human Resources at IBM

2022

Loss of leadership in the number of patents received for the first time in 29 years

In early January 2023, it became known that IBM for the first time in almost three decades lost its lead in the number of patents registered during the year in the United States. Read more here.

IBM will pay $1.6 billion to a competitor for inciting a client to switch to its software

A federal judge ordered IBM to pay BMC Software $1.6 billion for allegedly encouraging a common client to replace BMC software with IBM products. This became known on May 31, 2022.

The court's decision is the result of a lawsuit filed by BMC in 2017 accusing IBM of breach of contract, fraudulent solicitation, misappropriation of trade secrets and unfair common law competition.

This verdict is not fully supported by facts or law, and IBM intends to achieve complete cancellation on appeal, "IBM said. - In this agreement, IBM acted in good faith in every respect. The decision to remove BMC Software technology from its mainframes was made exclusively by AT&T, which was recognized by the court and confirmed by the testimony of AT&T representatives admitted in court.

The company's CEO, SP500, who asked to remain anonymous, said the verdict points to the complexities facing suppliers, acting as both an "IT outsourcer" to the customer and as a software or hardware provider reselling software or IT hardware licenses.

In a lawsuit, Houston-based BMC said a common client, AT&T, removed 14 BMC software products from its mainframes and replaced them with IBM mainframe software products as part of the so-called "Swallow's Tail Project," according to Miller's 106-page findings. facts and legal conclusions in the case.

Five additional BMC products have been replaced by third-party products and one BMC product has been discontinued, according to the documents.

According to court documents, BMC and AT&T entered into a master purchase agreement back in 2007, and IBM for many years served as an IT outsourcer for the AT&T mainframe environment. BMC and IBM also entered into a master licensing agreement in 2008 and subsequently added "outsourcing investment" agreements to MLAs.

IBM and AT&T signed a contract for the Swallowtail project in June 2015, and BMC's lawsuit was related to the initiative. (AT&T was not involved in the lawsuit.)

IBM argued that AT&T had independently made the decision to abandon the BMC software and replace it with IBM products and other vendor software.

But in his three-page final judgment, Miller said he found BMC's lawsuit against IBM for fraudulent inducement "newsworthy" and said, that BMC is entitled to $ 717 739 615 in indemnity for contractual damages and an equal amount in punitive damages, as well as 168 226 367,29 dollars in interest - only $ 1 603 705 597,29. USA

Miller, however, dismissed a number of other BMC claims, including breaches of MLAs and outsourcing apps, unfair competition by misappropriation and claims of lost profit.

Miller, in his ruling, stated that BMC "provided sufficient evidence in accordance with applicable legal standards of both existence (or" fact ") and damages in the form of lost license fees and related ancillary services totaling about $717. millions for IBM violating Section 5.4 of the OA and $717 million for IBM fraud. "

Regarding the $717 million in punitive damages, Judge Miller wrote that the court "considered all evidence relating to the nature of the offense, the nature of the conduct involved, the extent of IBM's guilt, the situation and the feelings of stakeholders, how much such conduct offends public sense of justice and decency, and IBM's solvency^[1].

2021

Plan to help 30 million people around the world get the skills they need for the professions of the future

On November 9, 2021, IBM announced a global plan: by 2030, help 30 million people of all ages around the world get the new skills they need for the professions of the future. To achieve this goal, IBM has released a roadmap under which the company is going to conclude more than 170 new academic and industry partnerships, including in Russia. This plan will use IBM's existing career platforms and training programs to increase access to education and in-demand technical specialties.

"Talent can be found everywhere, but learning opportunities can't," said Arvind Krishna, chairman and CEO of IBM. - That's why we must take sweeping and bold steps to increase access to digital skills and employment opportunities so that more people - regardless of their background - can take advantage of the digital economy. IBM is committed to providing 30 million people with new skills by 2030. This will help democratize opportunities, fill the widening skills gap, and give new generations of workers the tools they need to build a better future for themselves and society. "

IBM's plan to train 30 million people relies on a wide range of programs, as well as cooperation with universities and key government agencies, including employment centers. The partnerships also extend to nongovernmental organizations, especially those targeting disadvantaged youth, women and war veterans. In general, IBM's efforts are designed to motivate the private sector around the world to create and expand opportunities for traditionally unprotected segments of the population.

"Digital transformation has reached the point where it affects all workflows, functions and roles in enterprises and organizations, and the need for training becomes mandatory for society to adopt. The development of digital skills, albeit in different scales and forms, is now required throughout the education system, in most business functions and in the professional IT community in order not to jeopardize the investments made. The IBM program has the size and reach that will support this transition, "noted Martin Sundblad, research manager and co-head of European skills practice at IDC.

Enterprise Mail Issues with Cloud Migration

In early July 2021, IBM employees faced the problem of accessing corporate mail and scheduling events on the calendar. The failure is caused by IBM's 18-month-long migration of internal workflows to the cloud.

The tech giant's move of the email system to the cloud has resulted in thousands of employees unable to send letters, receive alerts about upcoming meetings and schedule work on the calendar, The Regiser reported.

For some unknown reason, IBM specialists cannot restore important services for employees within a few days.

I am sorry that I reported this to the press, but I am afraid that I am just one of the many thousands of blue giant employees who are currently extremely unhappy, "said one of the IBM employees. - If we can't even manage our own cloud migration program, then why should customers trust us?

An IBM employee in an interview with The Register said that the source of the problem with the protracted migration to the cloud and the technical problems that appeared against this background is the company's chief financial officer James Kavanaugh.

Kavanaugh, according to the source, has introduced cost-cutting policies and refuses to hire people who could speed up the migration of internal workflows to the cloud.

After the press learned about the problems in the company, IBM noted:

Some IBM employees are experiencing delays in sending email. We are working to restore service as quickly as possible, and we are using a variety of alternative means of communication to provide minimal disruption to our customers and our business while we work to restore all email capabilities.[2]

2020

IBM will pay $24 million to US authorities to impose IT services on schools when performing E-Rate

At the end of December 2020, IBM agreed to pay the US authorities more than $24 million to resolve investigations by the US Federal Communications Commission (FCC) over subsidies provided to it for connecting schools and libraries to broadband access networks under the E-Rate program. Read more here.

IBM separates managed infrastructure services business into new IBM NewCo structure

On October 8, 2020, IBM announced its separation into a new independent business company for providing services in the field of managed infrastructure (assistance in cloud migration, hosting, network management, etc.). The new structure was called IBM NewCo. Read more here.

Stopping the development of facial recognition technology

On June 9, 2020, it became known that the American corporation IBM will no longer develop or sell software and facial recognition services. The company will also abandon research in this area, writes The Verge, citing a letter from IBM CEO Arvind Krishna to the US Congress.

IBM fears that the use of facial recognition technologies could lead to a violation of basic human rights and racial discrimination.

IBM opposes the use of facial recognition technologies, including those offered by other suppliers, for mass surveillance and racial profiling, as well as leading to violations of fundamental human rights and freedoms or any goals that do not meet our value and principles of trust and transparency, the letter said.

Krishna also noted that artificial intelligence (AI) is a powerful tool that can help law enforcement agencies ensure the safety of citizens, but suppliers and users of AI systems have a common responsibility for the quality of testing algorithms for bias, especially when used by law enforcement agencies.

IBM called for a national dialogue on how facial recognition technologies should be used in the work of law enforcement agencies and whether they should be used at all. In addition, in his letter, the CEO of the Blue Giant proposed a number of measures that are supposed to contribute to the "achievement of racial equality" in the United States.

The corporation does not explain its choice of the moment to announce the cessation of the development of facial recognition technologies. IBM announced its decision against the backdrop of mass protests in the United States, which were provoked by the death of George Floyd. An African American died while being detained by police in Minneapolis, Minnesota, who were later accused of excessive cruelty.

According to to data the American television channel, CNBC IBM's facial recognition business did not bring significant income to the company. Agency sources familiar with Reuters the matter said that the decision to abandon the development of the product was made long before the story of Floyd - a few months ago^[3]

IBM and US authorities begin to use supercomputers to fight coronavirus

In March 2020, IBM announced the creation of the COVID-19 High Performance Computing Consortium, which plans to use the power of supercomputers to combat a new type of coronavirus. The consortium was formed in collaboration with the US Department of Science and Technology Policy (White House office of science and technology policy), the US Department of Energy and a number of research and educational institutions. Read more here.

Developing the ethics of artificial intelligence

In early March 2020, Microsoft and IBM signed an ethical code for the use of AI, published by the Pope. At a special three-day conference, Rome called for the observance of basic ethical principles when using AI. Read more here.

New IBM CEO - Arvind Krishna

On January 30, 2020, IBM announced the appointment of Arvind Krishna to the post of CEO together with Ginni Rometty, who led the IT corporation for 8 years. Read more here.

2019

Avaya Hybrid Cloud Implementation Partnership

On September 24, 2019, Avaya announced that it had signed a cooperation agreement with IBM, under which Avaya will begin implementing IBM hybrid cloud solutions. According to Chris McGugan, Avaya's senior vice president of solutions and technology, IBM and Avaya plan to create the most comprehensive contact center solution on the market. It aims to combine Avaya's software and infrastructure with IBM's hybrid cloud, consulting, and implementation services capabilities. Read more here.

IBM was punished for lying when developing a website under a state order

In mid-June 2019, IBM and its subsidiary Curam Software agreed to pay $14.8 million to settle charges brought by state health insurance company Maryland Health Benefit Exchange. Read more here.

IBM to invest $2 billion in artificial intelligence equipment

In February 2019, IBM announced an investment of $2 billion in the creation and improvement of equipment for tasks related to artificial intelligence.

To do this, the company will create an R&D center on the campus of the Polytechnic Institute ( SUNY Polytechnic Institute) in Albany (New York, USA). Employees of this laboratory will be engaged in research, development and testing of computer chips used for AI purposes.

IBM plans to allocate at least $30 million for joint projects with the Polytechnic Institute, and the university itself will spend up to $25 million on them. The company hopes that the AI device development center will be able to attract new AI companies and researchers from government organizations, as well as contribute to the economic development of the region and create additional workplaces. The center will collaborate with various technology companies, including Samsung and Tokyo Electron Limited.

Under the governor's leadership, our partnership with companies will continue to drive scientific breakthroughs and economic growth. We can work on anything from fighting disease and cancer to mitigating climate change, "said Kristina Johnson, Doctor of Science at SUNY.

The New York authorities supported the IBM project and agreed to provide $300 million for the purchase and installation of equipment that the company needs to work. In addition, the parties agreed to jointly invest $55 million in artificial intelligence-related research at the State University of New  York.

The announcement of IBM's development of hardware AI technologies in New York was made jointly by company executives and state governor Andrew Cuomo. The latter noted that this project will allow New York to take a leading position in the field of artificial intelligence research.^[4]

Release of a database of 1 million photographs of faces for training biometric systems

At the end of January 2019, IBM released a database containing 1 million photos of faces taken from the Flickr service to help developers train biometric systems. Read more here.

Start certification of data specialists

On January 29, 2019, IBM and The Open Group consortium launched certification of data processing and research professionals to formalize training in one of the most popular career areas. Read more here.

2018

Groupon to pay IBM about $57 million for patent infringement

On October 1, 2018, Groupon announced the settlement of a patent dispute with IBM, following which the Internet group discount service will pay the opponent $57 million. The companies also entered into an agreement on mutual licensing of patents. Read more here.

IBM raises product prices due to Trump import tariffs by up to 25%

At the end of July 2018, IBM informed its business partners that it was raising prices for a wide range of tape drives and related products by 25%, in particular due to imports introduced by US President Donald Trump and related to the import of materials from China.

IBM provided partners with a list of 137 products, the price of which is likely to increase: from power cords for $19 to an IBM TS1155 3592 FFE streamer based on Ethernet $65 thousand. The price of most goods increased by 25%, but in some cases this figure reached 26 or 27%. The price increase did not apply to goods ordered before July 24, 2018, and products subject to special duty rates.

One of IBM's suppliers noted that price increases in the worst case will only briefly reduce turnover, but not everyone is so sure about it. Although prices will rise for all suppliers, their impact on demand may differ depending on the scope of application, because in some cases the turnover is relatively small, in others it depends on the season, but at the same time it is rather tightly limited and cannot easily change due to price increases. However, their growth due to import duties is able to reduce demand in all directions.

In addition to IBM, the price increase was announced by Gigabyte, a Taiwanese manufacturer of a wide range of IT products from keyboards and mouse mats to servers and PCs. The company told its suppliers and developers that it could raise prices by 10% on certain equipment in August 2018, depending on the outcome of the U.S.-China talks.

Prices for motherboards, video cards, hard drives, mice, CPU coolers and power supplies will rise. However, prices for items such as computers, servers, laptops, keyboards, memory cards, headsets, PC cases and mouse mats will not change. Gigabyte also recalls that import duty laws will not come into force until the end of August 2018.^[5]

2017

Billions of dollars in lost revenue

At the end of December 2017, Bernstein analyst Tony Sacconaghi criticized IBM for a lackluster strategy: the company makes billions of dollars, but directs them to buy back shares and pay dividends to shareholders, instead of doing something decisive - for example, buying big players in the IT market.

According to the expert, in the period from 2012 to 2017, the total amount of funds received by the company amounted to about $92 billion, but IBM returned 80% of this amount (almost $74 billion) to investors in the form of dividends or redeemed shares. Blue Giant spent almost $50 billion on the acquisition of its securities alone, Sacconaghi notes.

This is far from the best strategy, given that IBM sales have been declining for 22 consecutive quarters, and pre-tax profits during the period under review decreased from $23 to $14.3 billion.

In retrospect, it is obvious that IBM management clearly underestimated the difficulties that the company faced... The question is, what could be done differently?, "Sacconaghi reflects in an analytical note, excerpts from which are published by the British edition of The Register.

According to the expert, IBM's affairs would have gone very differently if in 2012 it had spent $20 billion on the purchase of developer systems and CRM corporate systems software Salesforce , or acquired a company offering ServiceNow solutions for automating IT service management for $4-5 billion.

The question does not leave us whether IBM, instead of relying on its own strength (which it actually did by buying back its shares), should have taken a different path and acted more actively in terms of acquiring (and selling) assets in order to recreate and diversify its business, Sacconaghi writes.

The analyst believes that the $47.5 billion spent by IBM on stock buybacks could be used to take over SaaS companies that today threaten traditional IT players. As an alternative, Sacconaghi sees the sale of some minor divisions, such as IBM Consulting (formerly IBM Global Business Services).^[6]

Creating the world's first 5nm chip

On June 5, 2017, IBM announced the world's first chip based on a 5nm process. Such solutions claim to be the fastest and most economical.

The development of the 5nm chip was carried out jointly by IBM, Globalfoundries and Samsung. They created a chip the size of a human nail, on which 30 billion transistors fit, while in 7-nm solutions this number does not exceed 20 billion. According to the developers, the use of the new technology increases processor performance by 40%, and energy efficiency by 75% compared to comparable 10nm products. Even more compact and faster chips will find application in artificial intelligence systems, virtual reality and other applications that require high performance, writes Fortune, citing an IBM post.

This is a big chance in the development of transistors, "says IBM McGregor, founder and senior analyst at Tirias Research, commenting on the announcement of 5nm IBM chips. The goal is to continue to reduce transistors while improving performance.

According to the expert, by the beginning of June 2017, the semiconductor market is gradually switching from a 10nm to a 7nm process technology, and the 5nm technology will be the next. IBM plans to start producing such chips around 2020.

Huiming Bu, head of semiconductor devices at IBM Research, noted that the 5nm chips will be manufactured using extreme ultraviolet lithography (EUV) technology, which has never been used in commercial production before. Extreme ultraviolet light has a wavelength of only 13.5 nm versus 193 nm in traditional lithographic systems.

Mastering the 5nm process should allow the semiconductor market to follow Moore's law, according to which the number of transistors placed on an integrated circuit chip doubles every two years.^[7]

Creating the most accurate speech recognition system

In March 2017, IBM announced the creation of the world's most accurate speech recognition system. The American IT giant broke the record set by Microsoft.

According to IBM, the company managed to reduce the share of errors in computer speech recognition to 5.5%, which was the best result ever. Previously, IBM achieved 6.9%, and Microsoft - 5.9%.

For comparison, people do not understand about 5% of words in heard natural speech. Thus, IBM has brought its artificial intelligence closer to human capabilities. The company sets a goal to reduce the proportion of errors in speech recognition to 5.1%.

In March 2017, IBM reported that the company's software still could not capture all the nuances of speech, such as its tone or metaphors, however, reducing the error rate in recognizing the direct meaning of words was a great achievement. IBM intends to continue work to ensure that machine learning is not inferior to people in "the complexity of the interaction of human ears, voice and brain."

IBM's development is based on a recurrent neural network like LSTM (long short-term memory; so-called long-term-time architecture) and the WaveNet algorithm for synthesizing human speech, which allows you to achieve realistic voice imitation. Measurements of speech recognition accuracy were carried out in SWITCHBOARD and CallHome programs. The first of these has been used in the industry for about two decades.

Despite the impressive successes of recent years, achieving human results in tasks for artificial intelligence such as speech or object recognition remains a scientific challenge. Standard tests do not always show the differences and complexities of real data, "said Yoshua Bengio, head of the algorithm training laboratory at the University of Montreal.[8]

Strategic partnership with Salesforce

In March 2017, IBM and Salesforce announced an international strategic partnership and agreed to promote joint solutions created using AI technologies. Such services will allow companies to make more informed decisions faster than ever. As part of the partnership, Bluewolf has also opened a new direction that will provide customers with quick access to cognitive solutions and data in Salesforce multi-cloud environments.

2016

IBM Health Corps Program Winners Announcement

At the end of September IBM 2016, she announced the first winners of the medical program. Over the Health Corps next six months, the most talented employees from different countries will provide free consulting services in the field, the health care total market value of which is $2.5 million. More. here

Fighting Zika virus

On July 27, 2016, IBM announced plans to provide its technology and resources to help track the spread of the Zika virus. Read more here.

2015

IBM will reveal to China the source code of its software

On October 16, 2015, it became known that IBM would show the Chinese authorities the source codes of its software. Thus, the "blue giant" may become the first major American IT company to agree to comply with Beijing's requirements regarding increased control over foreign technology, writes The Wall Street Journal (WSJ).

According to two knowledgeable sources of the publication, IBM will allow employees of the Ministry of Industry information technology and Information Technology (MIIT) to study the source codes of some of its software products. True, government officials will be able to access this data only in a special closed room, from where they will be prohibited from taking out any information.

The media do not know what software IBM will share, and how long MIIT employees will be able to study them in that very secret room. The interlocutors of the publication say that this practice for the PRC is new. Neither IBM nor MIIT provided official comments.

According to Reuters, foreign IT products claiming to be used in Chinese state financial institutions are being severely tested for security, which greatly complicates the activities of American companies in the Celestial Empire.^[9]

Earlier in 2015, American businesses called on the Chinese government for "urgent negotiations" over a review of cybersecurity requirements that require foreign companies selling computer equipment to Chinese banks to disclose the source codes of their products and implement Chinese encryption algorithms in them.

WSJ interlocutors familiar with IBM's strategy argue that IBM was ready to deepen partnerships with the PRC government, unlike other American companies.

During a speech in Beijing on October 15, 2015, IBM Senior Vice President Steve Mills announced the company's readiness to provide China with access to the source codes of its software in order to confirm its security for the country. The next day, the WSJ published.^[10]

Ban on the use of IBM servers in Navy missile defense systems

On May 19, 2015, it became known that the US Navy may abandon the use of IBM servers in computer systems that control anti-missile systems. The armed forces fear the consequences of gaining access to the corporation's technologies from the Chinese computer manufacturer Lenovo.

In 2014, Lenovo acquired from IBM a division producing servers of the standard x86 architecture, including BladeCenter systems used in the operation of the Edgis ship combat information and control system.

US Navy to abandon IBM servers over Lenovo deal

"Ijis" is able to simultaneously monitor targets and hit them on land, in water, under water and in the air. The decision to defeat targets threatening the ship can be made automatically thanks to advanced IT systems.

According to The Wall Street Journal (WSJ), citing a Navy spokesman, the US Department of Homeland Security (DHS) saw security problems in the deal between IBM and Lenovo, and therefore limited purchases of BladeCenter servers by federal authorities.

According to the portal of the US Naval Institute (USNI), IBM servers used in the operation of the Aegis system will be replaced. At the same time, the source did not specify the name of the new supplier. The press service of the Navy did not give an unambiguous answer to the question of replacing IBM servers.

Lenovo spokesman Ray Gorman told the WSJ that the company does not comment on customer contracts, but it continues to sell servers and other products to the US government.

Lockheed Martin, which develops the Ijis anti-missile systems, refrained from informative comments and only noted that it was examining this issue with the Navy, and following the discussions, a "suitable action plan" would be chosen.

It is worth noting that due to the complication of political relations between Washington and Beijing, Chinese companies have become difficult to work in the United States, as well as American ones in China. This situation may affect the market opportunities of some manufacturers, believes Gartner analyst Errol Rasit^[11]

Forbes: Three reasons Apple should buy IBM

On May 5, 2015, Forbes magazine published an article titled "Three Reasons Why Apple Should Buy IBM." TAdviser offers a free translation of this publication in this material.

Tim Cook knows IBM

Apple CEO Tim Cook worked for IBM from 1982 to 1994. At the time of his departure from the company, he was its director, overseeing production and distribution issues in the North American representative office.

Since Cook took over at Apple, the company's relationship with IBM has improved. American IT giants have begun joint development of enterprise-class mobile software and are distributing iPads to older residents. Japan However, this partnership has not yet stimulated iPad sales: in January-March 2015, 12.6 million of these devices were sold, which is 23% less than a year earlier.

Apple CEO Tim Cook and IBM CEO Virginia Rometty

At the end of April 2015, Tim Cook expressed his optimistic attitude towards cooperation with IBM, noting that companies "want to change the work of people. There are too many businesses that are still stuck in another epoch. "

Apple can afford a big purchase

As of May 5, 2015, IBM's market capitalization is more than $171 billion against Apple's $741 billion. If we assume that the manufacturer of the iPhone and iPad will be ready to pay 20% more than its value for IBM (about $205 billion), then this deal will cost Apple only 28% of its shares.

IBM Needs Management

Buying IBM will only make economic sense for Apple if the deal can generate enough additional cash flows to offset acquisition costs. According to observers, the merger of IBM and Apple will reduce the cost of renting premises and save on combining duplicate departments responsible, in particular, for financial activities, personnel and purchases.

In addition, Apple may abolish some divisions that do not fit into the work of the combined corporation - for example, the mainframe business.

IBM has a well-developed sales channel and a strong consulting division that is focused on corporate and government clients that Apple lacks. Finally, the Blue Giant has an extensive portfolio of patents and technologies, among which Apple can find intellectual property to create the products that business needs.

Perhaps it really is the right time to take over IBM, which is going through a financial downturn. In January-March 2015, the company's revenue fell by 12% (to $19.59 billion), and this quarterly decline turned out to be the 12th in a row. Buying IBM would be effective if Apple could make the company's business a fast-growing one by selling high-demand corporate products. This will require real management skills, writes Forbes.^[12]

Watson Health unit creation: Honey data from Apple devices flocks to IBM

On April 13, 2015, it became known that IBM had created a new division called IBM Watson Health. It will manage a cloud service that will receive medical data from various sources, including fitness trackers, smartphones and smartwatches. Subsequently, this user health information can be shared with doctors and insurance companies to prepare personal health care.

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Health data of iPhone and Apple Watch owners will be transmitted to IBM cloud with their permission

Mobile devices have become part of this ecosystem. Apple More. here

How IBM will invest $3 billion in the Internet of Things

On March 31, 2015, IBM announced a major investment in the Internet of Things (IoT) market. The American corporation wants to make money from its real-time data collection and analysis experience, Reuters reports.^[13]

In the period from 2015 to 2018, IBM is going to spend about $3 billion to create a new division of the "Internet of Things." It will offer companies cloud services that allow IBM customers to search for new and multiply existing sources of data collection (smartphones, household appliances, building automation sensors, etc.) to improve their own products.

Weather Co., weather company, was chosen as the first major partner of IBM as part of large-scale work on the IoT market. Its IT division, WSI, which collects information from more than 2 billion sensors worldwide, allowing it to generate over 26 billion weather reports daily, will move its services to the IBM cloud.

Weather Co., weather company, was chosen as the first major partner of IBM as part of large-scale work on the IoT market.

Due to this, companies will be able to use meteorological data together with analytical tools of the "blue giant." For example, insurance companies will benefit from this, which will be able to notify their motorists of the impending city in time so that they have time to hide their vehicles in safer places. Thus, it will be possible to prevent the onset of an insured event.

Retailers will also take advantage of the cooperation between Weather Co. and IBM. By linking meteorological data with sales indicators, retail stores will be able to adjust logistics and staff work to purchasing activity in certain weather.

The company has already started working with a number of major partners, including German tire maker Continental AG and jet engine maker Pratt & Whitney, helping them leverage large amounts of data for operational purposes, IBM said.

Cooperation with Weather Co. and announced investments in the Internet of Things are part of IBM's strategy, in which the company distances itself from the production of equipment and consulting business towards cloud, mobile and analytical technologies, as well as solutions in the field of social services and information security. IBM expects to earn $40 billion on these products in 2018, which corresponds to 45% of the manufacturer's total sales predicted by analysts.

Creating a Cloud Division

In early January 2015, it became known that IBM began to form a division responsible for the development of the cloud business. The company has not officially confirmed this information, but previously spoke about the desire to create a special subsidiary structure that will oversee the cloud direction.

According to knowledgeable sources of the Bloomberg news agency, the new cloud division is called IBM Cloud. It was headed by Robert LeBlanc, who before his appointment was senior vice president of the company for the direction of binding software solutions. In the new role, LeBlanc will personally report to the CEO of IBM Ginny Rometty (Ginni Rometty).^[14]

IBM management has high hopes for the cloud business amid the company's financial downturn. In 2015, the manufacturer expects to earn $7 billion on cloud products against $4.4 billion in 2013. The size of this market on a global scale IBM predicts at $200 billion by 2020.

In

In January 2015, IBM began creating the cloud division of IBM Cloud

The creation of the cloud division was announced by IBM Vice President and CFO Martin Schroeter in October 2014 at a conference on the publication of quarterly results. Then the top manager said that with the help of the new structure, the company will make its cloud investments more targeted, improve integration and speed up the development of new solutions. Schroeter did not announce any detailed information about IBM Cloud at that time.

According to Gabriel Consulting Group analyst Dan Olds, IBM will be able to stand out in the fight in the highly competitive cloud market thanks to its high quality of service and support. The company will also be helped by its active geographical expansion, within which the "blue giant" is increasing the number of cloud data centers, the expert noted.

2014: Increased number of data centers worldwide

December 17, 2014 IBM announced a 25 percent expansion in the number (data centers up to 49) serving cloud infrastructure. IBM opened one data center each in Frankfurt, Mexico City and. Tokyo In addition, the manufacturer announced the launch of nine cloud sites in Australia,,, France Japan Singapore, Holland USA and together with the global data center operator Equinix.

2013: Creating a Cloud Services Division

In May 2013, IBM announced that it plans to earn $7 billion in the cloud services market in the next 18 months. As one of the main measures to consolidate in this market, IBM head Ginny Rometti created a separate Cloud Services division and put his longtime friend, Erich Clementi, vice president of IBM Global Technology Services, in charge of the new structure.

2012: Allegations of unfair criticism of SAP products

American chemical giant Avantor Performance Materials has filed a lawsuit against IBM accusing the IT company of dishonest business regarding SAP products. This was announced on November 10, 2012 by ComputerWorld.

The essence of the lawsuit is that, according to Avantor, IBM misled the company about the quality of SAP products in order to get a contract to implement its ERP system.

Avantor Performance Materials in 2010 decided to update the existing ERP system, which was based on SAP, according to a lawsuit filed in the District Court of New York, USA.

The plaintiff claims that IBM played on the fact that Avantor could not tolerate any failures in the operation of systems or applications, and assured the plaintiff that its Express Life Sciences Solution system would meet all the requirements, although the solution was developed on the same SAP platform that Avantor originally used.

After the implementation of the IBM decision, the plaintiff found a number of inconsistencies in the declared functionality. Avantor was also dissatisfied with the quality of consulting services, when consultants committed "numerous and rash designs, configurations and software errors."

Another reason for the lawsuit was that, according to Avantor, IBM did not warn the customer about possible risks and hastened to start the project without analyzing the current situation at the enterprise.

After the implementation was completed, IBM did not pay attention to the results of the test operation, as a result of which the system worked "out of hand badly" and could not process orders correctly and lost some of the documents compiled for some officials, in accordance with the requirements of the law.

Avantor estimates its losses at several tens of millions of dollars, as well as a significant blow to the company's reputation. The plaintiff claims that IBM, despite the poor execution of the contract, has already earned more than $13 million.

"IBM is now demanding an additional several million dollars to rebuild the embedded system," the lawsuit says.

IBM, in turn, denies all accusations in its direction and is ready to defend itself and its reputation in court. At the same time, some employees of the company argue that the previously implemented ERP system in Avantor is the worst implementation that has ever been seen.

Avantor expects within the framework of the court to more specifically determine the damage caused by the implementation of the IBM ERP system.

SAP is not aware of Avantor's statement of claim against IBM and did not comment on the current situation.

2011

Accusations of bribing officials in Asia

The Securities and Exchange Commission (SEC) has filed charges against IBM, suspected of organizing a long campaign to bribe officials in South Korea and China in exchange for concluding multimillion-dollar contracts for the supply of computer equipment.

According to the investigation, more than 100 employees of local IBM branches were involved in bribery, including two top managers who bribed officials for more than 10 years - from 1998 to 2009. In some cases, employees took officials on vacation, and also gave them gifts - laptops and digital cameras.

In the period from 1998 to 2003. The total amount of bribes to representatives of the state apparatus (16 people received bribes) in South Korea amounted to $207 thousand. By paying this money, the Blue Giant was able to supply personal computers, Mainframes, Storage Systems and other equipment. The money was transferred at personal meetings, which, as a rule, took place near the official's house or his work.

IBM aroused excessive suspicion for the reason that the company's work with the state apparatus continued even after a number of contracts were unsuccessful.

IBM did not admit, but also did not deny, its guilt, saying that it forces its employees to comply with the highest corporate standards, as well as the intention to take urgent measures to resolve the situation. In addition, the corporation agreed to pay compensation in the amount of $10 million.

The SEC charges were brought as part of the federal anti-bribery campaign against foreign officials, which began about a year ago, carried out in accordance with the Foreign Corrupt Practices Act (FCPA). Published in 1977, it prohibits all US citizens, companies and organizations from offering bribes to any officials, political candidates and political parties of foreign countries.

Meanwhile, for IBM, these accusations are inappropriate - the company has outlined expansion in the developing countries in question. Over the past fiscal year, the total revenue of the vendor in such countries increased by 16% and amounted to more than a fifth of the total annual income of almost $100 billion. By the end of 2015, the company plans to increase the share of revenue from emerging markets to 30%.

IBM got off with a relatively small fine, which under the FCPA can reach $100 million, and in the presence of fraudulent schemes - several hundred million dollars. Hewlett-Packard agreed in November to pay the fine. The amount of the fine amounted to $16.3 million.

Company Centennial Movies

In 2011, the company celebrated the centenary of its creation. Films were released on this occasion.

The first film, titled "100 x 100," features a hundred people, each describing a certain IBM achievement that occurred the year he was born. This film was directed by Joe Pytka, one of the most influential and successful commercial directors.

The second film, "They Were There," directed by Academy Award-winning documentary filmmaker Errol Morris and accompanied by music by famed composer Philip Glass, follows the leaders and inventors who accomplished some of IBM's most significant achievements, including inventing UPC code, participating in the first man's landing project on the lunar surface, and releasing the first mainframe.

The third film, called Wild Ducks, is currently being directed by Academy Award-winning actor Davis Guggenheim, director of the documentaries An Inconvenient Truth and Waiting for Superman. This film seeks to reflect the spirit of invention and risk that defines the nature of IBM Corporation.

IBM Watson supercomputer wins TV show against people

In 2011 supercomputer IBM , Watson, consisting of 90 IBM Power 750 servers, showcases the corporation's achievements in the field of system artificial intelligence architecture, winning a landslide victory in the American prototype of the TV show "Own Game" over its two multiple champions.

Billionaire Warren Buffett buys 5.4% stake in IBM

In November 2011, it became known that American investor and billionaire Warren Buffett bought a 5.4% stake in IBM, which is estimated at £7.5 billion.

IBM moves midsize business into the cloud

Understanding what is happening determines IBM's active participation in this market, its assistance to partners in the PaaS market (platform-as-a-service) and potential customers. "In this market space, the cloud is developing faster than in larger enterprises," he said, speaking at the IBM summit on medium-sized businesses. "Using the cloud, such clients are trying to master as many new opportunities as possible and as quickly as possible."

Last week, IBM began selling IBM SmartCloud services under their trade names by integrators and other partners. This solution fits into IBM's larger plan to provide services to medium-sized businesses exclusively through partners who, according to Monchaux, better understand the needs of their customers than IBM itself.

The cloud market for medium-sized businesses is very different from the market for large enterprises, Monchaux said. IBM defines an average business as an organization of up to 1,000 employees. The average annual IT budget of such companies is about $130 thousand, and IT personnel can number about 15 people.

In the IT-Business, these companies, according to IBM estimates, together generate $214 billion per year. Such organizations produce lower operating costs, and, as a rule, their development overtakes similar processes of larger companies. They perceive cloud services as a cheaper alternative, and sometimes the only option to expand their services, said Monchaux. Also, among medium-sized companies, there is a tendency not to hire IT specialists who can "independently integrate" systems.

Mike Grandinetti, managing director of venture capital firm Southboro Capital, who also spoke at the summit, supported an IBM spokesman, noting that in previous years, innovative startups could invest in servers. Today this is done extremely rarely. Instead, companies build their systems using cloud services and open source software. "The speed of development of such enterprises is staggering. Companies that in the past could have spent three years getting a million users achieve these results within three months, "he said.

Two years ago IBM , she changed her relationship strategy in the medium-sized business space: the company no longer sells its services directly, but assumes to work only with partners. According to Monchaux, partners know the situation in their specific markets much better. Small enterprises today, as a rule, consider business solutions in specific industry niches and require a subject-oriented, specialized approach to solve their problems. "Our customers shop with trusted business partners and buy their experience. It's very rare to hear a wish: "I only want my apps to run on servers IBM x86," he said.

Gary Barnett (Gary Barnett), the company's CIO and CTO who Bathwick Group participated in the summit, noted the uniqueness of the move IBM towards providing cloud computing small businesses in comparison with the cloud strategy of other major system providers such as. Hewlett-Packard Most system vendors are not ready to divide clouds into small portions, such as one or two virtual servers. IBM prices are still higher than the consumer-oriented service, and Amazon prices will need to be reduced, but they are moving in the right direction, the analyst said.

2010: European Commission investigations into mainframe market monopoly

In July 2010, the European Commission announced the launch of two new investigations into IBM and its dominant position in the mainframe market. The first investigation was initiated by T3 Technologies and Turbo Hercules, which develop software for emulation. They argue that IBM is imposing operating system ZOS its own hardware on the proprietary mainframe. This makes it impossible to use emulation technologies to run mainframe applications on cheaper equipment released by third-party vendors.

The initiator of the second investigation was the European Commission itself. Regulators suspect that IBM, which, in addition to releasing servers and software, is engaged in the provision of mainframe repair and maintenance services, is hindering the activities of other companies working in this direction. According to some reports, the corporation deliberately delays or even blocks the supply of spare parts, which no one produces except for it.

The start of investigations does not mean that the EC has evidence of violation of anti-monopoly laws, adds the Associated Press, but only the desire of the regulatory body to find out the specifics of the corporation's work in the European market.

Regulators insist that the mainframe market is an independent segment of the global economy, and at IBM - which is only part of a more extensive server market. The company claims that the leaders in today's server market are companies such as HP and Dell, whose servers are based on Intel processors. According to the corporation, in 2009, mainframes accounted for only 0.02% of the supply of all types of servers, and in terms of revenue this segment took less than 10%.

IBM suspects that it is behind these investigations, Microsoft interested in promoting servers running under control (operating system Windows just two months ago, Microsoft invested in T3 and Turbo Hercules). "Companies that could not achieve the desired success in this segment are now trying to take advantage of the help of antimonopoly authorities," IBM said. The corporation, however, is fully open to cooperation with the EC, intent on protecting its intellectual property from companies filing complaints "from scratch."

2008

Start of the "Intelligent Planet" program

In 2008, the Smarter Planet initiative was launched, the idea of ​ ​ which is to use the capabilities of global information systems to improve real-world processes. The first project was a system for intelligent monitoring of pollution in one of the bays off the coast of Ireland, designed to protect the population of marine fish.

IBM data center in Switzerland heats up pool water

data-center IBM New in the Swiss city of Hitikon (near Zurich), built in 2008, heats up the water in the local pool with heat removed from. servers The radiated heat would be enough to heat 80 houses.

2003: Searches of offices in South Korea in the case of bribes for the supply of computers to the government

In late 2003, South Korean prosecutors raided three offices of IBM's South Korean unit. Then the employees of the corporation were suspected of paying bribes to local officials for granting exclusive rights to supply computers to the government.

2002: Sam Palmisano - Head of Company, PWC Service Business Purchase

2002: In March, Sam Palmisano became CEO of the corporation, and in July IBM announced a further expansion of the service business by buying the global technology and business consulting division of PricewaterhouseCoopers for $3.5 billion. Later, this business joined the IBM Consulting division (formerly IBM Global Business Services) and became the most profitable in the IBM structure, generating more than half of the company's revenue.

2001

Charges for supplying tabulators to record prisoners in fascist camps

In 2001, the book "IBM and the Holocaust" was published; the corporation is being sued on the basis of the American law of 1789 on offenses against foreign citizens, incriminating the supply of tabs to record prisoners in fascist concentration camps. This lawsuit was later withdrawn. IBM was justified by the fact that its German branch, along with hundreds of other foreign companies, fell under the control of the Nazi authorities before World War II.

IBM buys Informix Software for $1 billion

On April 27, 2001, IBM announced its intention to purchase for $1 billion. Informix Software, a database business company within Informix Corporation. The move is supposed to help IBM strengthen its distributed database business and help it compete more successfully with its market leader, Oracle.

1990s: Crisis

• 1990: IBM launches a family of System/390 consisting of mid-range computers and supercomputers. In the corporation itself, System/390 is considered the largest product development in the last 25 years. Among the new technologies are high-speed optical channels, ultra-dense circuits, etc.

• 1991: Microsoft and PC clone manufacturers make huge profits, client-server architecture begins to develop, and IBM shocks longtime industry participants with a $2.82 billion annual loss announcement, the first in a three-year series. At this time, the corporation was managed by John Akers, and management is considering breaking up IBM into several smaller companies.

• 1993: Louis Gerstner, former CEO of RJR Nabisco, moves to IBM and serves as CEO and Chairman of the Board. At the inaugural press conference, Gerstner declares that he intends to keep IBM as a single corporation and speaks of his determination to turn it into a broad IT organization capable of playing the role of both supplier and system integrator for customers.

• In 1995, IBM introduced the ThinkPad 701cm laptop, powered by a 133 MHz Intel Pentium processor. Its elegant black design, which is not typical of IBM products, receives a lot of praise.

• 1996: IBM releases DBMS DB2 Universal Database, which allows you to store not only alphanumeric data, but also images, audio and video. In the same year, IBM actively adopts. Internet

• 1997: IBM "invented" eBusiness, announcing that the Internet was becoming a tool for business and heralding the advent of the e-commerce era.

Deep Blue, an IBM RS/6000 SP supercomputer capable of calculating 200 million chess moves per second, defeats world champion Garry Kasparov.

1980s: Personal PC is a lost battle

• 1981: IBM PC appears, the smallest and most inexpensive ($1,565) personal computer at that time. 64 kilobytes of RAM and one or two floppy drives were enough to execute the DOS operating system proposed by a small Microsoft company and a number of applications.

It is noteworthy that at first the company's management did not attach any importance to this machine: a group of only 4 people was engaged in development (under the leadership of Philip Donald Estridge). And - which had the most noticeable consequences - contrary to its strict principles of intellectual property protection, IBM did not patent DOS (with a BASIC language interpreter), nor another revolutionary invention of developers: BIOS. As a result, more prescient third-party developers, using the published specifications, made clones of the IBM PC, and a significant share of this rapidly growing market was lost to IBM.

IBM makes a deal with Microsoft to develop an operating system for PCs and allows competitors to purchase this system for installation on "IBM-compatible" clones. As a result, a fast-growing industry is born and its new giants appear - Dell, Compaq, etc.

• 1982: An antitrust lawsuit brought by the U.S. government against IBM back in 1969 is withdrawn. Perhaps this is what encourages IBM to further separate hardware from software, as a result of which customers have even more opportunities to mix products from different companies.

• 1984: By the mid-80s, IBM computers had learned to understand "by ear" 5,000 words with 95% accuracy. Today, speech recognition technologies have found application in a variety of applications - in the office, at home and on the go.

• 1986: IBM scientists receive the Nobel Prize in Physics for creating a scanning tunnel microscope; demonstrating its capabilities, researchers were able to manipulate individual atoms by adding the letters I-B-M from them.

This year, IBM lost first place in sales in its most generated personal computer market.

• 1987: IBM Personal System/2 (PS/2) operating system and OS/2, developed jointly Microsoft and IBM, are released. OS/2 supports multitasking. In just six months, a million PS/2 units were sold. IBM PC head James Cannavino wants to keep OS/2 compatible with AT, but Microsoft CEO Bill Gates wants to switch to new computers based on Intel the 80386 processor. In 1990, Windows 3.0 there are primitive multitasking tools, but since this shell can use the memory management system built into 386 processors, it becomes a sales hit. OS/2 is far behind.

1960s-1970s

• 1961: Selectric press released. Its later models will have memory, and they will become the founders of modern word processors.

• 1962: IBM and American Airlines rolled out SABRE, the world's first computer-based airline ticket reservation system, which launched extensive work on online banking technologies.

• 1964: The IBM System/360 computer appears, using solid-state logic microelectronic circuits. For the first time, the concept of a family of computers based on standard technologies is used. In fact, it was a $5 billion bet on future trends.

• 1966: Robert Dennard of IBM invents a dynamic RAM cell that remains the industry standard to this day.

• 1969: An onboard computer and other IBM technologies are used in the IBM human flight to the moon. An IBM lab has developed a magnetic strip for credit cards. Without it, it is still impossible to present identification cards, driver's licenses and plastic cards for ATMs.

• In 1969, MAGI created, by order of IBM, the world's first television commercial made on a computer.

• 1971: Thomas Watson Jr. leaves as head of IBM. He is replaced by Frank Carey. A floppy disk appears, later it will become a standard storage medium for personal computers.

• In 1972, an updated logo (letters from blue stripes) of the company was introduced, used to this day. Designer Paul Rand worked on the logo. The company's nickname is Big Blue, which can be translated from English as "big blue" or "blue giant." According to one version, the name came from mainframes supplied by the company in the 1950s - 1960s. They were the size of a room and had a blue color. According to another theory, the nickname simply refers to the company logo. Another version claims that this name comes from the company's former dress code, which required many of its employees to wear blue shirts and suits.

• 1973: Supermarkets began using UPC-based bar coding systems proposed by IBM. Today, with their help, literally everything is tracked - from goods in clothing stores to milking cows.

• 1975: IBM 5100 laptop is launched on the market, which weighs almost 23 kg and costs from 9 to 20 thousand dollars.

1940s-1950s: Small arms and the first computers

During the Second World War, the company produced small arms (M1 Carbine and Browning Automatic Rifle).

• 1944: IBM's first computer, the Automatic Sequence Controlled Calculator, or Mark I weighing about 4.5 tons, was created. This is the first machine capable of automatically performing a series of operations. The computer was based on electromechanical relays.

• 1946: IBM Electronic Multiplier 603 is released - the first commercially available machine on electronic circuits capable of performing arithmetic operations. Its length is more than 15 m, its height is about 2.5 m, and its weight is almost 5 tons.

• 1948: IBM launches the Selective Sequence Electronic Calculator, a large digital computer with electromechanical relays, which for the first time introduced the possibility of modifying the stored program.

• 1952: Thomas Watson Jr., becomes president of IBM. It was thanks to him that the IBM 701 was created - the first mass-produced electronic computer - on vacuum tubes. It is equipped with a tape drive; later, tape storage technology will become dominant. IBM's new president relied on electronic computers before they were even more cost-effective than electromechanical machines. Thanks to this, IBM has dominated the computer market for several decades, that is, during the mainframe era.

• In 1956, a settlement ended an antitrust lawsuit brought by the U.S. government against IBM in 1952, and IBM itself was beginning to pursue a more liberal policy on equipment licensing. In May, Tom Watson Jr., takes over as CEO of the corporation, and his father dies in June. Son is reorganizing IBM, laying down the concept of linear and functional divisions. This concept will later be adopted by the entire American business.

• 1957: IBM created FORTRAN (FORmula TRANslation), which became the main programming language for solving technical problems. Features of the language became one of the main sources of "The Problem of 2000." This language is still used today.

• In 1959, the first IBM transistor computers appeared, which reached such a level of reliability and speed that the US Air Force considered it possible to use them in the air defense early warning system.

The 1930th

• 1931 is marked by a whole bunch of achievements: IBM 400 accounting machines work with alphabetical data, 600-series counting machines multiply and divide, the first perforator-multiplier and the first copying perforator appear.

• 1935: IBM for the first time organized training courses for women so that they could work in technical positions, until then, according to tradition, exclusively for men.

• 1936: Thomas Watson Sr. insisted on continuing to produce counting machines during the Great Depression, in spite of a sharp drop in demand. His efforts paid off when IBM was invited as a supplier of counting and perforation machines for the "largest accounting operation of all time" conducted by the U.S. government after the Social Security Act of 1935.

During the Great Depression, only multimillion-dollar revenues helped IBM "stay afloat." Despite the crisis, company president Thomas Watson Sr. continues to fund research and pay workers salaries. Large orders from the US government in 1935-1936 helped IBM get out of the crisis.

• 1937: Thomas Watson Sr. is elected president of the International Chamber of Commerce and at the Berlin meeting speaks in support of "world peace through trade." This slogan was adopted by the ICC and IBM itself. Germany awards Watson the Order of the German Eagle. In 1940, he returns the order and thereby infuriates the Nazi government.

Nevertheless, IBM subsequently repeatedly became the object of criticism for doing business in Germany in the 30s. The German subsidiary of IBM, Dehomag, in the 1930s supplied equipment for processing racial census results in Germany. According to its results, Jews, gypsies and half-breeds were registered, subject to destruction.

1888-1924: Foundation and formation of IBM

• In 1889, Bundy Manufacturing Corporation, a manufacturer of chronometric equipment, was created.

• In 1890, a census was held in the United States. To process its results, the "electric tabulator" invented by Herman Hollerit was first used. Thanks to him, the census data was processed in just 3 months, instead of the expected 24.

• In 1896, encouraged by the success of Herman Hollerit, he created The Tabulating Machine, a manufacturer of electric tabs that use punched cards.

• On June 16, 1911, Bundy, Tabulating Machine, Computing Scale Company of America, and International Time Recording merged into the Computing-Tabulating-Recording Company (C-T-R), headed by Charles Flint. It has a staff of 1,300 employees.

• In 1914, 40-year-old Thomas Watson Sr. came to work at C-T-R, who had previously mastered aggressive sales tactics at the National Cash Register, because of which he was arrested on charges of monopoly. After working for C-T-R Corporation for 11 months, Watson became its president. He perfected sales and marketing by heading for large sets of tabulators for commercial businesses. In Watson's first four years at C-T-R, the corporation's turnover more than doubled to $9 million. In the next four decades, Watson, who served as CEO of IBM Corporation, became a real icon of American business. He first introduced the now usual benefits for workers: paid vacations and collective insurance, maintained discipline and loyalty among several generations of IBM employees.

• 1923: The first electric keyboard rock drill appears

• 1924: C-T-R is officially renamed International Business Machines, after one of its Canadian affiliates.

• 1928: An 80-column IBM punched card appears. It will become the standard for the next 50 years.

Notes