July 14th, 2004
IBM: a leader, but at what cost to you?
I’m at the AO2004 conference, listening to IBM software chief Steve Mills give an overview of IBM’s on demand strategy, which he calls a “state of business.” At the core of IBM’s strategy is providing software infrastructure/middleware. To that end, Mills said that IBM has acquired 35 software companies over the last several years, including the Alphablox acquistion announced today. Turning all those acquisitions and other IBM code into a set of coherent infrastructure components and services is going to be IBM’s biggest challenge. Mills cited the high cost of integration, especially in time and people. IBM thinks that it can lower integration costs for customers with its vast array of middleware and consulting services, but at this point the cost savings are not even close to where they need to be. Until IBM can better integrate and simplify the deployment of its massive middleware product family—which will impact the fortunes of IBM’s consulting services–the company will remain a high cost leader.
As a side note, as Mills is speaking, a live chat is displayed on a large screen with comments from people watching a Webcast of the event. Here are a few typical comments:
“He’s just a salesman. But wait, call one of our operators now and we’ll give you 20% more middleware for free.”
“Enough of the IBM commercial.”
“Seriously, what is this dribble….what a waste of 45 minutes.”
If those on line chatters were at the AO2004 event in person, would they offer their comments to Steve Mills’ face? I think not. It’s easy to say what you think without risking confrontation. Mills mostly gave a commercial, but he wasn’t asked any hard questions that would take him out of his marketing patter…
