Next month an IBM computer called Watson will go head-to-head against the top two human Jeopardy champs for a prize worth $1 million. Whether Watson wins or not, what I wonder about this contest that was four years and untold millions of dollars in the making is how it squares with the image I’ve presented here over the last several years of a penny-pinching, greedy, avaricious, and not particularly smart IBM? The answer is simple: IBM has a split personality.
IBM values research and development. The research organizations like the one behind this Jeopardy stunt still share in a specific percentage of IBM’s gross sales. That’s how IBM keeps coming up with the amazing technologies we read about in Scientific American and Wired. Those divisions have not been looted and continue to operate.
So we can expect many noteworthy research innovations from IBM in coming years as well as more publicity blitzes like this Jeopardy thing that are substitutes for actual marketing because they involve no real products.
As for the rest of IBM, the product teams are small and still enjoy some level of autonomy and power. They have many constraints in their jobs — limited funding and the fact anyone in the company can veto their plans — but they still get stuff done.
It is the really big IBM teams like strategic outsourcing that are under constant change, constant threat (of resource action), under constant pressure, horribly over-managed, and badly managed. They are under attack from three sides — ridiculous budget constraints; very troubled contracts; and a sales organization that can and will sell anything at any price, no matter how much it damages the company.
So IBM will continue to roll out new hardware and try to get top money for it. IBM will continue to sell lots of software, but put very little money back into that business. IBM will continue to loot and damage its services business. The effects on the services business are now beginning to show up in the quarterly reports. It will take years, though, for the collateral damage to become apparent. By then the executives who did the damage will be long gone.
IBM’s competitive advantage over HP and Sun was IBM had a services business. Then HP bought EDS. Sun was swallowed by Oracle. While IBM understands it needs a services business it is mismanaging and damaging it. In doing so IBM is not only hurting one part of its company, it is souring its relationship with customers. An upset customer will be inclined to not only drop its services business with IBM, but also its hardware and software business too. In time IBM’s services business will become a detriment to the company.
And that’s IBM’s real jeopardy.
Things should really get interesting in Double Jeopardy!
Can WATSON answer the visual Daily Double?
Whether Watson Windsor knot?
Bob, valid points, at least in this country. In my national burg, IBM long term staff are fleeing in great numbers.
Now Hurd has been replaced, will the new CEO and cronies continue Hurds legacy and do the same to HP? Internally HP feels worse than IBM, but has pockets of renewal trying to do better. IMNSHO, Orakle Inc has become the best advertisement for IBM kit and AIX. IBM and HP might even make a buck out of fleeing Sun customers.
So that leaves Lockheed and CSC as big service companies, but they dont have hardware. Linux is getting better, but there is still resistance to replacing legacy Windows with a modern operating system.
I will be very interested to see if IBMs new mainframe with Intel “books” sells to big government and coporates replacing Superdome hardware.
I remember reading an article in 1996 about IBM’s Clever project involving weighted graphs of hyperlinks.
The Clever project seemed like a very interesting piece of research and the Google founders seem to have agreed. Why didn’t IBM turn this into a publicly accessible search engine?
The project actually started a number of years earlier, very close to the time Google was breaking into the market and Altavista was the preferred search engine.
It was IBM’s belief they could search and index the whole Internet, then SELL it as a premium service to companies and universities. It never occurred to IBM management that one could offer such a service for FREE and pay for it with advertising.
IBM’s mindset was in the past, firms would be willing to pay a premium for an IBM branded service. Google’s mindset was in the future, Internet based services should be free.
IBM saw the effort as a great way to sell lots of hardware. To offer a free service Google had to find a way to deliver it using very low cost, commodity hardware. In doing so Google developed a lot of really great technology — technology that inspired cloud computing and storage.
Maybe there is some truth to the saying “necessity is the mother of invention.” Thinking out of the box, thinking towards the future led Google down a very different path. In time IBM realized they had a nice technology that they could not “sell” and now it is a historical curiosity.
— Google’s mindset was in the future, Internet based services should be free.
TANSTAAFL. What Google is finding: adverts are an ephemeral thing. They stole adverts from newspapers, killing real journalism (another topic). Someone else (Facebook?) will steal adverts from Google; searching the www is not the be-all end-all of existence.
— In doing so Google developed a lot of really great technology
I remain unconvinced. Google just cuts out the middlemen by assembling pieces of kit themselves. They were hardly the first Big Company to do that. Their “database” tech is just a rehash of 50 year old file processing. As to cloud: not yet clear whether public cloud will be any better than IBM Service Bureau which goes back further than you think.
Amazon and Google both had to develop a new database to support their company.
When was the last time IBM introduced a new database? 1972?
Codd’s paper was 1969. IDS was 1961. IMS was 1965. Oracle was 1979. DB2 was 1983.
Now, all the hoopla about xml, MR, and such is a rehash of IMS, the original hierarchical datastore. It *postdates* the network datastore, IDS. The difference: the hierarchical permits one parent “record”, the network allows multiple; in both cases, the structure is hardcoded. IBM didn’t want to license IDS/IDMS so it built a retrograde datastore.
If by “new” one means a datastore which implements a more robust model of data (neither hierarchical nor network datastores were specified from a model of data; the “models” were post-hoc justifications), there has been none since Codd’s Relational Model. BS from Google or whomever doesn’t change that; what these folks do is off the cuff ad hocery compared to the rigour of Codd. No one has yet attempted to specify a more sophisticated model.
If by “new” one means getting closer to what Codd specified, then Oracle/DB2/SQLServer get a bit closer each release.
“IBM’s mindset was in the past, firms would be willing to pay a premium for an IBM branded service. Google’s mindset was in the future, Internet based services should be free.”
Thanks for the reply. I always wondered why IBM didn’t capitalise on their invention.
I think that in general, IBM is able to come up with some very interesting inventions which IBM only wants to sell to enterprise customers. If IBM could package their inventions such that the common man or woman can use it, then they may see a better return on their investments in inventions.
IBM advertisements currently ask the question “What do 3 million lines of code have to do with your luggage?” which should have read: “Why are 20,000 lines of code better than 3 million lines of code at getting your luggage where it’s supposed to be?”
New inventions, same company.
@Bob:
IBM’s competitive advantage over HP and Sun was IBM had a services business.
Well, no, not exactly. As I have predicted since Oracle bought Sun (and Bob decided not to include in his 2011 list), the advantage IBM has are all those z/Series (or whatever it’s called today) Fortune X00 clients. Lose the z/Series box, and services disappear.
Larry has lusted for those clients for a long time. There’s a reason Relational Software (not even its first name) had the first “commercial” RDBMS, stealing a march on Armonk. Armonk hated Codd, since he stuck a fork in IMS shortly after its birth. Larry wanted an alternative to the mainframe app world. He had only software, but did OK.
But the only way to get all those bug, juicy Fortune X00 z/Series clients away from IBM is to have a full stack. He has to find a way to convert 20, and 30, and 40 year old COBOL code to something modern. With the Sun hardware and Oracle he now has a shot at it. It won’t happen tomorrow; I’m wagering a prediction that there’ll be concrete progress this year.
As to overplaying his hand with the *nix client base. It wouldn’t be the first time he’s done that, too. I don’t see one strategy precluding the other tactic.
that’s “big, juicy”, although the Freudian slip is apropos.
Robert,
Fine words! Except that some of the code is now 50 years old and don’t forget that inside every zOS is an IBM 402 application emulated with Autocoder!
I think like you that Larry may finally come up with the winning sauce and a brand weakened enough IBM that he’ll finally give them a run for the money and customers will finally see the mainframe economics come down to reasonable levels.
To be fair, the blue pig executives are now beginning to realize that the economics of outsourcing are going to change dramatically as the economy and the value of the dollar changes and the US demographics make it once again profitable for kids to go into the IT business. So now they are working feverishly to rehabilitate their image through LinkedIn and Facebook IBM alumni social networks. They are even trying to get the poor folk they kicked in the face and threw out as garbage to admit they miss the maltreatment they got at the Blue Pig and thus help recruit others to join the company in exchange for some nonsensical memories. Even the Jeopardy stunt is targeted not towards the young folks, but to the older folk demographic to get them to appreciate the brand again.
Unfortunately, I disagree with Bob X on the hardware business. One of the most lucrative yet widely looted businesses within IBM is the maintenance service business. Unless they turn it around, even if you have the sexiest and great hardware if the maintenance sucks the market will eventually punish you.
+1 Robert Young.
Every shop I’ve been in, the zSeries box is the the holiest of holies, and in most shops, the college of cardinals are IBM employees. To suggest other than a mainframe is like suggesting fallibility of the Pope. You _just_don’t_go_there_.
I’m currently in the midst of implementing an IBM application on the mainframe, replicating one that was running on IBM/AIX and was ported from Windows by IBM… written in python… by IBM. The strange thing is we could have allowed the mainframe to use the AIX as a ‘service’ to provide the funcationality and to a man (and they were all men, except the IBM project manager who just shrugged) they said “Why would you want to do that… The Mainframe is the best platform for this functionality, therefore we must have the application ported onto this frame” (note, this is database that is queried once every tape mount to generate and store an encryption key… a couple hundred calls a day… it’s not compute or data intensive). It boggled my mind to hear that, but then I put myself in their (IBM’s) position. Anything NOT running on the mainframe is the _worst_ place for it to run…. for IBM.
— this is database that is queried once every tape mount
^^^
yeah, for some this is the 21st century. not so much for others. may be there’s an opportunity here.
Tape??
Cool reading. Thanks to author!
You’ve finally realized IBM’s real strategy for getting out of their current terminal mess –> To wait for the boffins come up with a piece of kit that will put them back in front and allow them to dine out for another 20 years, just as they have in the past. In the mean time they’ll just eat their young.
What has ANY of this got to do with PS3 and PSP being totally cracked?
From what you have said in previous articles, IBM hardware is lagging Moore’s Law. This is not a positive sign.
“It is the really big IBM teams like strategic outsourcing that are under constant change, constant threat (of resource action), under constant pressure, horribly over-managed, and badly managed. They are under attack from three sides — ridiculous budget constraints; very troubled contracts; and a sales organization that can and will sell anything at any price, no matter how much it damages the company.”
Hah, that’s great – you’ve captured exactly what it feels like to be in IBM’s Strategic Outsourcing arm at the moment. Very apt.
While not diminishing the leaps in machine learning or the software engineering effort by the IBM Research team, I don’t think they succeeded in creating a machine that could “play Jeopardy at a top level”.
There were no audio categories, images (of art, places, architecture,
people…) or video clues. These are as much a part of the game of
Jeopardy as phrasing the answer in the form of a question. If there
were no such clues by chance (I doubt it), then IBM and the Research
team have built a computer that can win one particular game of
Jeopardy. If they were excluded intentionally, which I suspect is the
case as these would be too difficult for Watson, then IBM has not
built a Jeopardy killer and it will be a long time before they can.
“Oh, of course they didn’t have those types of clues, they would be
nearly impossi…” Exactly.
Watson won a particular game of Jeopardy that was skewed in it’s favour.
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