After the Sun Sets, What Now for IBM?

After IBM, What Now for Sun? is the title of a good article at Business Week assessing the consequences of no merger between IBM and and Sun. But the better question is our title. Over the past 20 years and despite leading the US on patents, IBM has slowly but surely become the image of its last two CEO masters, Sam Palmisano and Lou Gerstner – consultant suits. Sure Software has grown but primarily by acquisition. And the company pays name plate obeisance to the old mainframe business – but it is steadily exiting IT hardware markets one after another (think network processing gear, desktop computers, key data storage sectors, etc). Clearly consulting dominates the business.

Question – given all its patents and software investments, when did IBM last shake up either a hardware or a software market? IBM is not a major player in 3 of the fastest growing IT markets:
1)RAIA- Rich Anywhere Interactive Applications
2)Cloud Computing and Virtualization
3)Netbooks and Information Devices Everywhere
Sure IBM can trot out presence in segments of everyone of these markets – but how about first-starter thumping innovation and leader ship ? Acquiring Sun would have allowed IBM to get strong hardware and/or software positions in everyone of the 3 major gaps in its portfolio. At the same time IBM would have gained a bulwark against HP , Dell and Cisco in the server market and against EMC and company in the data storage markets. So riddle me this – after the Sun sets,  what now for IBM ?

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