IBM’s Low-end Server Business Acquired For $2.3 Billion

IBM’s Low-end Server Business Acquired For $2.3 Billion

IBM_logo

Lenovo has finally acquired IBM’s low-end server business, after a deal spanning over a year has finally come to a close. The final acquisition price came to $2.3 billion, making it the largest tech server acquisition by a Chinese company.

IBM has been trying to shift its x86 server business for a few years now, with more companies switching to cloud computing technology from traditional server-side infrastructure. IBM is looking to invest more money in high-margin servers, which still generate impressive revenue.

Lenovo has more reason to own low-end x86 servers, given their high reputation in China, it will be easier for the company to sell their servers to Chinese companies, who are looking to nationalize their servers with the recent U.S. surveillance outbreak. Lenovo may be able to boost revenues and margins on the x86 servers if they invest heavily in China. Most Western companies are now either moving to high-end servers, their own or cloud based infrastructure, adding more benefits to the user.

IBM has been a stepping stone for Lenovo’s success before, in 2005 the Chinese company acquired IBM’s ThinkPad PC business for $1.75 billion, bolstering their position in the PC market from unknown to first place.  This is not the first time Lenovo has tried to purchase the business, last year IBM offered it out to the company for $6 billion, but Lenovo declined. In one straight year, the price has dropped by more than half, analysts believe this is due to higher grossing cloud computing firms and more companies looking to newer and faster technologies.

Hewlett Packard is currently the major player in the x86 server business with IBM second, although their position may drop due to this large scale acquisition. Lenovo is currently not in the top five, but given the amount they are prepared to invest, we could see a repeat of the PC market battle.

Analysts predict the x86 servers bring in around $4 billion in revenue annually. As the PC market dwindles, Lenovo is looking to invest more in back-end technology and mobile, making sure they have their backs covered when the PC dies.

By Walter Bailey

Sorry, comments are closed for this post.

Comic
SWIFT Says Bank Hacks Set To Increase

SWIFT Says Bank Hacks Set To Increase

Bank Hacks Set To Increase SWIFT, whose messaging network is used by banks to send payment instructions worth trillions of dollars each day, said three clients were hacked over the summer and cyber attacks on banks are set to increase. The theft of $81 million in February from Bangladesh’s central bank using SWIFT messages rocked…

Security: Avoiding A Hatton Garden-Style Data Center Heist

Security: Avoiding A Hatton Garden-Style Data Center Heist

Data Center Protection In April 2015, one of the world’s biggest jewelry heists occurred at the Hatton Garden Safe Deposit Company in London. Posing as workmen, the criminals entered the building through a lift shaft and cut through a 50cm-thick concrete wall with an industrial power drill. Once inside, the criminals had free and unlimited…

The Lighter Side Of The Cloud – Data Merge

The Lighter Side Of The Cloud – Data Merge

By Christian Mirra Please feel free to share our comics via social media networks such as Twitter, Facebook, LinkedIn, Instagram, Pinterest. Clear attribution (Twitter example: via @cloudtweaks) to our original comic sources is greatly appreciated.

The Rise Of Threat Intelligence Sharing

The Rise Of Threat Intelligence Sharing

Threat Intelligence Sharing  Security has been discussed often on CloudTweaks and for good reason. It is one of the most sought after topics of information in the technology industry.  It is virtually impossible to wake up and not read a headline that involves the words “Breached, Hacked, Compromised or Extorted (Ransomware)“. Included (below) is an…

Moving Your Email To The Cloud? Beware Of Unintentional Data Spoliation!

Moving Your Email To The Cloud? Beware Of Unintentional Data Spoliation!

Cloud Email Migration In today’s litigious society, preserving your company’s data is a must if you (and your legal team) want to avoid hefty fines for data spoliation. But what about when you move to the cloud? Of course, you’ve probably thought of this already. You’ll have a migration strategy in place and you’ll carefully…

HOW THE CFAA RULING AFFECTS INDIVIDUALS AND PASSWORD-SHARING

HOW THE CFAA RULING AFFECTS INDIVIDUALS AND PASSWORD-SHARING

Individuals and Password-Sharing With the 1980s came the explosion of computing. In 1980, the Commodore ushered in the advent of home computing. Time magazine declared 1982 was “The Year of the Computer.” By 1983, there were an estimated 10 million personal computers in the United States alone. As soon as computers became popular, the federal government…

Staying on Top of Your Infrastructure-as-a-Service Security Responsibilities

Staying on Top of Your Infrastructure-as-a-Service Security Responsibilities

Infrastructure-as-a-Service Security It’s no secret many organizations rely on popular cloud providers like Amazon and Microsoft for access to computing infrastructure. The many perks of cloud services, such as the ability to quickly scale resources without the upfront cost of buying physical servers, have helped build a multibillion-dollar cloud industry that continues to grow each…

Digital Transformation: Not Just For Large Enterprises Anymore

Digital Transformation: Not Just For Large Enterprises Anymore

Digital Transformation Digital transformation is the acceleration of business activities, processes, and operational models to fully embrace the changes and opportunities of digital technologies. The concept is not new; we’ve been talking about it in one way or another for decades: paperless office, BYOD, user experience, consumerization of IT – all of these were stepping…

Connecting With Customers In The Cloud

Connecting With Customers In The Cloud

Customers in the Cloud Global enterprises in every industry are increasingly turning to cloud-based innovators like Salesforce, ServiceNow, WorkDay and Aria, to handle critical systems like billing, IT services, HCM and CRM. One need look no further than Salesforce’s and Amazon’s most recent earnings report, to see this indeed is not a passing fad, but…

The Cloud Is Not Enough! Why Businesses Need Hybrid Solutions

The Cloud Is Not Enough! Why Businesses Need Hybrid Solutions

Why Businesses Need Hybrid Solutions Running a cloud server is no longer the novel trend it once was. Now, the cloud is a necessary data tier that allows employees to access vital company data and maintain productivity from anywhere in the world. But it isn’t a perfect system — security and performance issues can quickly…

The Storytelling Machine: Big Content and Big Data

The Storytelling Machine: Big Content and Big Data

Bridging The Gap Between Big Content and Big Data Advances in cloud computing, along with the big data movement, have transformed the business IT landscape. Leveraging the cloud, companies are now afforded on demand capacity and mobile accessibility to their business-critical systems and information. At the same time, the amount of structured and unstructured data…

Shadow IT To Remain A Focus For Both Cloud Vendors And CIOs

Shadow IT To Remain A Focus For Both Cloud Vendors And CIOs

Shadow IT To Remain A Focus Shadow IT, a phenomenon defined as building internal IT systems without the official organizational approval has been a growing concern for CIOs over the last few years. In 2015, it climbed to the top of the list of the emerging IT threats, with as much as 83% CIOs reporting…

Cloud Computing – A Requirement For Greater Innovation

Cloud Computing – A Requirement For Greater Innovation

Cloud Computing Innovation Sao Paulo, Brazil has had trouble with both energy and water supplies as of late. Despite it is the rainy period. Unfortunately Sao Paulo is very dependent on its rain as a majority of its power is generated from large dams. No water, no energy. Difficult situation for a city of some…

Cloud Infographic – The Future (IoT)

Cloud Infographic – The Future (IoT)

The Future (IoT) By the year 2020, it is being predicted that 40 to 80 billion connected devices will be in use. The Internet of Things or IoT will transform your business and home in many truly unbelievable ways. The types of products and services that we can expect to see in the next decade…

Cloud Infographic – What Is The Internet of Things?

Cloud Infographic – What Is The Internet of Things?

What Is The Internet of Things? “We’re still in the first minutes of the first day of the Internet revolution.”  – Scott Cook The Internet of Things (IOT) and Smart Systems are based on the notions of Sensors, Connectivity, People and Processes. We are creating a new world to view and measure anything around us through…

Moving Your Enterprise Apps To The Cloud Is A Business Decision

Moving Your Enterprise Apps To The Cloud Is A Business Decision

Moving Your Enterprise Apps Whether it be enterprise apps or any other, if there is any heavy data that is going to be transacted in and through an app, then affiliating it with the Cloud becomes a must. And then an important question arises: How do you decide when to integrate your enterprise app with…