IBM cuts jobs

Around 50 Systems and Technology Group jobs at IBM have gone in Australia, with many others to be moved to Lenovo, says an IBM source who asked to remain anonymous.

Around 50 Systems and Technology Group jobs at IBM have gone in Australia, with many others to be moved to Lenovo, says an IBM source who asked to remain anonymous.

IBM officials, however, haven't responded to Computerworld NZ inquiries about whether jobs in New Zealand in its Systems and Technology Group will be affected, following the January announcement that Big Blue is selling its x86 server business to Lenovo.

The Australian reported this week that IBM was cutting around 500 jobs across the board, following last year’s cull of more than 1500 workers.

Worldwide, IBM expects to transfer around 7000 jobs to Lenovo as part of the US$2.3 billion deal.

IBM is spending US$1.2 billion to expand its cloud footprint, positioning itself to compete with the likes of Amazon.

“You have to wonder what the message is for the New Zealand market,” the source says. “Where does it put hardware in general and its traditional software products?

“Is IBM, in fact, getting out of the hardware business?”

The source says that, locally, IBM has sold nothing into the government’s infrastructure-as-a-service.

IBM has a managed service focus around CAMS (cloud, analytic, mobile and social), and it is pushing to sell SoftLayer, for which it paid around US$2 billion last year. SoftLayer was the world’s largest privately held cloud computing infrastructure provider.

New Zealand is too small for some of IBM’s directions, the source says. “If IBM New Zealand were a US city it would have turned into an 0800 number.”

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