Thread regarding IBM layoffs

Cringely is almost always wroing

While a full restructuring would be great to see, I firmly believe the board and all SVPs are too darn lazy to put anything in motion. Other companies are inspired and investing in staff, products, and services. IBM bucks the trend, even among the peer dying tech giants like Oracle.

2kdz. If services is 50% of the 350k worth of heads, that means 175k heads in service (GTS/GBS). That number seems to make sense since services is pushing 11.2 billion in 4th q, or just over 50%. So my question = where will the heads come from if not services. I believe services will have to ante up 60k worth of heads if we assume a 1/3 cut. That means IBM will totally exit some GTS and GBS businesses. The same can be Said for Cognitive. Perhaps 20-25k worth of heads. The remaining 30-35k worth of heads have to come from corporate/systems/labs/IGF/sales/marketing

IBM cuts GBS down to the marrow. GTS is already running on threads so nothing left to cut.
Salaries in GBS avg 20% higher so those cuts will mean more to the bottom line.
IBM IT consulting services seems to be getting their butts kicked so no love loss there.

He is close with his predictions, just a little off the mark.

1. Systems will get joint ventured off to an IBM/HPE/Cisco venture. IBM doesn’t want to be in the manufacturing business anymore. Everyone will throw something in. IBM will contribute Design,manufacturing, and patents/lab work (past and future) IBM will own 1/3 - 1/2 of the joint venture, and guarantee a market for their products (much like global foundries). There is too much to be made of the legacy here, but IBM has to get their IP out and a joint venture does that and allows the two other players to, make money too. Cisco may just play with the storage, while HPE will take the manufacturing and marketing. NOTE someone will supply the Intel, but that is up for bids
2. GTS gets sold. (everything except cloud). Even though we say GTS, think perform so a small piece of GBS will go, along with a piece of cognitive too. The remaining GTS cloud part gets rolled into GBS. Why? Because Tata, HCL, Wipro, and Infosys do perform a whole lot cheaper, and they want the market share. One of them will bid a pretty penny for the perform part
3. GBS will become the consulting piece for the 1100 IBM enterprise customers with Cloud becoming the perform piece. This is IBM’s enterprise legacy getting farmed Due to relationship. IBM has a 50 year relationship with these customers and will not give it up easily.
4. Cognitive will remain the transformative SW piece. Mostly LINUX, but middleware, OS, and database wise too. If you want to convert, re-write, modernize, build new, etc etc this will be where you will shop if you are in the fortune 1100
5. Once IBM right sizes (approx 2 years down the road), one of the FANG companies will buy IBM in a stock swap deal

That prediction honestly doesn't make any sense.
He's predicting that 1) IBM sells GTS to HPE or Oracle, 2) IBM spins off Cloud/Cognitive (e.g., what used to be Software Group) as a separate company with AK as the leader, and 3) what's left (Red Hat, Systems, GBS) is the new IBM under Whitehurst but they'll fire all the GBS people within a year.
I could see #1 happening. #2 is unlikely. #3 is absurd.

Do people still listen to Cringely? I made the mistake of paying $3 for one of his books once. I've never read something so repetative in my life. He's a one trick pony.

This is the same guy (Cringely) that predicted Jim Whitehurst would become the CEO within 6 months. Pretty close! President in 7.