IBM announced yesterday that it is buying Whistle Communications, an Internet services company.
IBM is acquiring the Foster City, California-based company to sharpen its focus on providing small companies with complete Internet and e-mail services.
IBM plans to aim its offering -- consisting of Whistle's InterJet thin server product as well as a number of IBM tools, services and financing options -- at companies with fewer than 100 employees.
"We were looking for somebody who could help us with the early stages of Internet staging for small businesses," said Peter Rowley, IBM's general manager of small business. The services the company wants to provide include Internet access, e-mail, Web browsing and research, and implementing Web sites and e-commerce.
"We have those offerings at the high end, but we didn't have good offerings down at the bottom," Rowley said. "What we are now doing is having a very clear, very simple combination of hardware, software and services that is unequaled in the marketplace."
The key to that combination for IBM is Whistle's InterJet, which offers e-mail, Web access, publishing, firewall security and routing capabilities, and can be extended to allow remote access, virtual private networks and Web site locking, all in a single device.
"Our goal has been to create solutions that level the playing field for small businesses," said Gordon Ritter, Whistle's co-founder and vice president of business development.
"We have a critical position in networking, and the opportunity is to build on that with additional services that only IBM is able to bring," Ritter said. "We've talked with all of IBM's competitors, and none of them has the full suite and commitment to end-to-end services that IBM has. They're the perfect partner for us. Together we can extend e-business deep into the small-business base."
The companies did not release financial terms of the acquisition, but said Whistle will retain its own identity within the IBM organisation.
"We'll keep the Whistle name, and products will remain Whistle-branded solutions," Ritter said. "All employees are going to continue on with the company, and we'll be adding to the payroll going forward."
"[Whistle has] 75 employees who have been dedicated to the small-business market for last two-and-a-half years," IBM's Rowley added. "We're looking at this as a competency centre for small business inside IBM. We'll be transferring some existing functions to them as we continue our relationship."
"We're not changing a lot," he said. "We've bought the best small-business-oriented company in the industry."