Business, Investments

IBM to invest heavy in big data and cloud technologies

IBMIBM is planning to bet high on its cloud and big data technologies, the company said in its recently released 2013 annual report for the investors.

“To meet growing demand for greater speed, and legal requirements for compliance and data residency, IBM is aggressively expanding its global cloud footprint,” said Ginni Rometty in a letter to investors. She moreover added that modern demands of Big Data and cloud technology requires enterprise strength computing that no other company can match with IBM’s technology capabilities and commitment to developing those technologies.

According to IBM, the demand for big data and analytic technologies is rapidly increasing. The market for data and analytics is estimated at USD 187 billion in 2015. To capture this the company is required to build “world’s broadest and deepest capabilities in Big Data and analytics — both technology and expertise.”

The company has invested more than USD 20 billion including USD 17 billion in acquiring some 30 tech based companies. Talking of cloud technology investments, Rometty claimed that “IBM today is the leader in enterprise cloud” thanks to “its investment of USD 7 billion on 15 acquisitions, most notably SoftLayer in 2013.” It bought SoftLayer Technologies Inc, a US based cloud computing infrastructure company to integrate its existing hardware and data analytics with its service.

Rometty also said that the company fell short of expectations last year – which can significantly be improved by investing in its cloud and analytics technologies. According to her it is very important for the company to address its struggling hardware businesses. She also signals that the company will consider shifting the IBM hardware business for new realities and opportunities by accelerating its System product portfolio in particular.

It is clear that IBM is not betting high on its hardware business anymore and is looking to gradually divert itself from its hardware manufacturing business and focus exclusively on software. But given that the company is into hardware manufacturing from quite some time now – we think shifting entirely from hardware to software would take time – at least a few years.

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