I have a TV producer friend I worked with years ago who at some point landed as one of the many producers of American Idol when that singing show was a monster hit dominating U.S. television. She later told me an interesting story about Carrie Underwood, the country-western singer who won American Idol Season 4. That story can stand as a lesson applicable to far more than just TV talent shows. It’s especially useful for the purposes of this column for explaining IBM’s Watson technology and associated products. You see the producers of American Idol Season 4 knew before the season was half over that Underwood would win. And, by the same token, I’m about to argue that IBM already knows that its Watson artificial intelligence technology has lost. In each case they chose not to tell us.
In the case of American Idol, the likelihood that Carrie Underwood would be the eventual winner was clear from the very start of audience voting. In case you’ve forgotten, the premise of Idol was that professional judges would audition, accept, then eliminate singers for the first half of the season at which point judging was handed over to the TV audience voting by phone, text, or online to choose the eventual winner. What made Underwood different from the three previous Idol winners, according to my friend the producer, was that from the very start this time the votes weren’t close at all. The country-western singer not only came out on top of every weekly vote, she often garnered an outright majority of the total vote against many other singers. Someone was always in second place but second place was never close enough to matter.
Fearing that what was clearly a blow-out victory would lose the interest of the TV audience, the Idol producers decided to keep the actual vote totals a secret. Yes, Underwood was the winner week after week, but the show never said how close was the vote. They implied, in fact, that votes were close when they never were. They created a sense of competition where there really wasn’t one. This was what they felt they had to do for the sake of their TV show which was, after all, a business. If people no longer felt they had to support their favorite (Underwood) or realized that continuing to support their favorite (anyone but Underwood) was pointless, well the show wouldn’t have had as many viewers and wouldn’t have been as profitable.
What the heck does any of this have to do with IBM, you ask? Since you are already sick of me writing about IBM I’ll argue that it has to do with any technology company that has made a huge commitment to some new product line only to have that line come up short in the voting that customers do with their buying dollars.
It’s very difficult to tell from IBM’s reported financials whether Watson is a success or not. As I have already reported, the way IBM segments its revenue makes it difficult to see whether the company’s so-called strategic initiatives are making money. This is especially the case for Watson, whose results are not only mixed up with revenue decidedly not from what IBM calls Cognitive Computing: IBM also splits Watson revenue across two different segments. So while IBM continues to talk a good game for Watson it isn’t at all clear whether Watson is delivering much in the way of sales.
Or at least it was not clear until now.
Recently I came into possession of some internal IBM data concerning Watson product registrations. Almost anyone can try Watson for free but to do so requires first registering with IBM. There is pretty much no entry barrier for these registrations. If a single development group inside a corporation decides to give Watson a try, that counts for the whole company: they are IN.
Here are the Watson registration numbers as of approximately one week ago:
Let’s parse these very real internal IBM numbers and decide what they mean. Clients are IBM corporate and institutional customers — everything from banks to universities to government agencies. So far precisely 500 of these have registered as Watson users. That number, in itself, is questionable. Precisely five hundred, really? But let’s accept it. The client target for 2016 was 8145 of which 500 represents six percent so Watson is presently missing its target client registrations by ninety-four percent.
IBM business partners are companies that resell IBM products or services. Watson business partners are specific to Watson. This chart says there are 329 Watson business partners though IBM’s 2016 target is 4047. Admittedly 2016 is far from over but at this point IBM appears to be 92 percent behind its target.
For a program that is at least three years old, this level of sales performance is dismal. If only eight percent of the companies that are supposed to be selling Watson have even minimal experience with the technology it’s difficult to say it is even broadly available. Certainly cloud-like sales increases of 30+ percent per year aren’t happening for Watson.
At what point will IBM admit this? Not until they are forced to.
If I were to hazard a guess why these numbers are so bad (understand this is only a guess) it’s because the most prominently missing Watson customer is IBM itself. Big Blue has made the most fundamental mistake in high tech: they don’t eat their own dog food.
It was explained to me awhile ago that IBM’s biggest customer for IBM Mainframes is(was) IBM. IBM (Leasing Group) would buy the mainframe and lease them out to customers. For years. This kept the volume up and helped grease IBM’s profits.
Would love to know who the ‘Business Partners’ are…. My guess would be a IBM division is one of them and probably doing most of the volume.
There are many firms who resell IBM products. Many of the i-Series (formerly known as AS/400) and storage systems are sold through resellers, or “partners.”. A few years ago to save money IBM cut its sales force and pushed the work to them.
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It is not unusual in industry for one to sell their products through distributors or resellers. They have access to many customers in a region and can represent many businesses. However when there is no interest in a product, there is no interest. It doesn’t matter who is trying to sell it. The lesson here is to note how much interest in IBM has been lost by the market. We’re watching a crash in very slow motion.
…but but but! Watson is Big Data *and* Machine Learning (…and much better than the competition, actually)! And they are the new paradigm that will arise from using data as raw material and input to build any product that you can imagine, and many that you cannot, with! How can it not be successful? That would imply that Big Data is not -at all- what you told us 10 posts ago!
First understand that Watson is primarily at best a technology, not a product. It’s an approach to analyzing large data sets that began as a super computer application then was ported to IBM’s cloud. Customers who have spent serious money on Watson generally haven’t yet deployed it for any production purpose. I have spoken with one CIO whose company has invested $75 million so far in Watson with nothing to show for it. Most of that money, by the way, went for IBM consulting services. So when you read a story that says a company is going to throw Watson at making cars drive themselves I’m not here to say that won’t yield useful data, but what I AM here to say is it won’t yield self-driving cars. Building Watson into the process hasn’t yet worked well for any customers I have met. Bringing this back around to Big Data, you’ll recall that my Big Data definition was “finding actionable meaning in large data sets.” We’re awash in data and finding meaning is the whole justification for retaining data in the first place. Big Data is becoming increasingly meaningful at the exact same time that Watson is becoming DECREASINGLY meaningful as proprietary methods inevitably give way to open source. By the time they figure what Watson is best for there will be a free solution that’s just as good.
The Watson limit is that it needs experts train it for months before becoming worthwhile, and at the same moment can only dig in knowledge it has been fed, and needs as much post training as training to weed out the bad answers from the knowledge base (my favorite point in the very first public demo was when travel watson answered ‘what’s the capital of paris’ with ‘beijing capital airport’)
Anyone but the largest, most weird customer, can do the math and see how an hand crafted fuzzy system would beat it on cost and performances every time.
If they decide to bail out and sell Watson, I can think of several large tech companies who would likely be quite interested in acquiring it.
I can’t think of any such companies. IBM has spent billions on Watson and would want to sell it for billions. Starting from scratch and replacing Watson would be, at this point, more of a $100 million effort. Or less.
You nailed it: They don’t eat their own dog food. In 30+ years (retired in 2015), I tried to convince customers to buy services that we weren’t using internally…(gulp). We did NOT eat our own dog food in many cases. Slide-ware/chart-ware/vapor-ware can only get you so far.
Concur. I punched out after 35+ years and absolutely, we never ate our own dog food. The closest we came was in the days we were all carting around Thinkpads, but even there, the last 5 years I was toting a MacBook Pro …
IBM hasn’t made PCs for over a decade now. I’m not sure there’s that much dog food left to eat these days, but I always thought my dream IBM job would be to go around to IBMers at customer engagements and pitch the IBM tools to them. It amazed me that fellow IBMers didn’t even know about the VOIP capabilities in SameTime or how easy it was to collaborate with some of the Lotus tools (which, at the time, were superior to SharePoint). The goal would be to let our customers see us using them and, you know, want to BUY them.
Yes, I knew about the VOIP; your comment reminded me that in the relatively early days of the existence of the services division, I repeatedly found myself having to go out and present to its team meetings to explain to them what IBM products could do. For years, I found myself undoing, or at least trying to undo, the damage these guys would do to IBM’s interests.
I hated Lotus! I cringed when we’re told to sell Connexions. Horrible. Our intranet was a joke. The messaging app everything. Sure it’s better than Sharepoint but not as good as all the little bits & bobs of software out there. Bloated and unusable.
W
Are you having a laugh? Lotus notes was a hodgepodge of crap IBM software masquerading as an email client. I was embarressed sending emails from it to customers because I saw what it looked like on their clients. It looked like it had been written in notepad and you’d forgotten to hit return a few times. Even Gmail is a better client than Lotus.
I could’ve kissed Outlook when I got it after leaving. Everything worked it linked to other services without needing to replicate to other servers. What’s that replicating crap about anyway?
ST is rubbish as well Lync is way better.
Oh and Claim. I was filling it in one day when the customer dropped down to my desk, they looked over my shoulder and asked what it was? I told them, and they asked has it been updated since the 90’s. TBH they were right, it looks awful like everything IBM does now. Even their slick new stuff looks like it’s mid-noughties.
Stick a fork in IBM they’re done!
Are you saying that Watson users are like real women on Ashley Madison?
Obviously it is a commercial failure. If it was a success, they would be shouting from the roof tops. Instead they are hiding the results.
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What could be more obvious?
No dog food eaten here. Smarter Process is focus for clients, but IBM doesn’t actually have a BPM install that they can use for internal process management. I guess it’s important for everyone else to have smarter process, but not for IBM. Forget that they would YUUGELY benefit from implementing the smarter process technology and refining their own processes, literal bottom-line numbers, but it would help make the lives of everyone involved much better in the interim.
IBM uses BPM internally. Quite a bit in the internal processes for Cloud Managed Services and the Security Services division. I agree a lot more efficiency could be achieved if there were more widespread use within IBM.
Compared to what is commonly done in many mature companies. IBM’s internal tools (and BPM) are more like primitive animal skins and stone implements. Most IBM’ers have never worked anywhere else. They’ve never experienced good business systems first hand. Take a look at IBM’s website. Try to find information on a specific product you bought 3 years ago. It is not easy. It may surprise you, but IBM’s internal websites are even worse.
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IBM does use Watson in its HR planning. IBM uses Watson to pick people for resource actions. It is actually a very cleaver arrangement. While the result of the process is highly discriminatory, the fact they are using machine algorithms gives them legal wiggle room. People didn’t discriminate against people. An unbiased, logical machine picked them.
>> IBM uses Watson to pick people for resource actions. It is actually a very cleaver arrangement.
“Call for Dr Freud. Dr Freud to the white courtesy phone.” Part of me wants to believe you spelled Clever that way intentionally.
Cleaver. Cleaver. he he hehehe he.
sounds like most internal use for the tools within IBM is making the Five Year Plan (tm Leninists) palatable to the corner offices.
I doubt that Watson is being used to select individuals, at least not right now. As far as I can tell from my admittedly narrow vantage point, staff reductions are currently driven by proximity to the work site and by whether upper management perceives a continued need for your business function going forward. You don’t need Watson to identify folks who are working from home or working in the US or Europe when most of the work has already been moved to India or Mexico. The use of Watson in itself would not be an adequate legal defense in any case. Watson can kick out the data, but somebody has to go over the data and sign off on it. If Watson is being used, it’s probably being used to run statistical analysis on the lists of employees that have already been chosen to go, same as HR has done in the past, to ensure that the company’s butt is 100% covered.
Sorry but I can not help to pronounce. Taxevation?
SAAB Sweden’ now lost crown for carmaking never went profitable to make the numbers reveal that fact. So they made fancy, nice looking cars out of stupidity..
These numbers are simply false. I’m assuming someone sent you these and told you they were number of clients using Watson but they are not. I have the full internal email and can confirm these are number for registrations for a conference, not “Watson product registration”. The email is pushing to get more clients to the conference. Your imagine conveniently leaves out the word “conference”.
Then send me what’s missing and I’ll write about that: bob@cringely.com.
You said “Recently I came into possession of some internal IBM data concerning Watson product registrations.” What he and IBMer (below) are saying is that the table applies to registrations for the 2016 conference at the end of October in Las Vegas.
Yes, that data was the convention totals to date from a while back and well before even the first deadline to register. That email was sent to just about every IBMer even remotely associated to the convention’s products and services. The email was basically to say, “registration’s open!”
This is Bob’s oldest trick: he gets a piece of “data” from someone’s butt somewhere, misinterprets it, throws it out there, and is sure that even if it’s claimed to be wrong, someone will prove him wrong by sending him the real stuff. He’s even bragged about using this tactic in two of his books.
Watson is failing. ibm revenue will continue to decline. On to the next hype. Hope you are not a US employee. Hehe.
Oops…
Good gawd Bob, you hit the nail on the head: Carrie Underwood should be running IBM.
The funniest thing I remember when I worked at IBM was they provided Oracle services in one of their GS practices.
I asked Kevin Maney (author of The Maverick and His Machine: Thomas Watson, Sr. and the Making of IBM) about the state of IBM a couple of years ago and he said they still have Watson. That’s true, they do.
It is also being reported that Google Fiber installations have fallen far below their goal. Is Google Fiber toast? Will they be able to save their ISP business with last mile wireless?
The Google Fiber installation in Austin has fallen flat on its ass. Everybody is pissed, and Google wont say a thing. They tore up streets, clogged runoff drainage, then disappeared. Shee-uh!
Word in The Oregonian is that Google Fiber has been shelved here in Portland Metro Area. SIGH!
Bob, I’m a fan and everything you’ve been saying here and on Seeking Alpha is true, but those are definitely registration numbers for the World of Watson conference. I have the same email (internal). It does speak to “nobody is interested” but it’s definitely for the conference.
12,000 seems to be an ambitious goal for one conference, unless its Apple WWDC or similar. ??
It is not a conference registration. It is getting customers to step up and by signing up show their interest in Watson. Customers are not interested. Watson could be a solution in search of a problem.
When did you realize that your Kickstarter project (Mineserver) was a failure? You are now almost 20 months late on a 3 month project that “only needed some money for cases to start shipping”.
Not a failure for every one…
In my experience the point about IBM not using their own products internally is more the exception than the rule, especially in the business process software arena. Perhaps is a situation like “the cobblers children have no shoes”, but often its because the company had to have a system in place before their software was up to the task and then the inertia and fear of change is too great to shift.
There has actually been a shift away from using IBM products to using the best products available. This is why you see people with macs using github and slack inside IBM.
Data never understands nor will ever parse human emotion. Its too stocastic.
What’s too random, data or human emotion? What’s the proper level of randomness?
I can say one thing, many of my government clients want to go to the Watson conference, but can’t get approval because it’s in VEGAS and the GSA made that place radioactive.
The sad thing (Irony ??) is that IBM research division, Watson et al, is where many experts in “Big Data” business came from.
Here’s why they can’t sell anything – screwups like this (and a lot of them lately) https://www.itnews.com.au/news/costs-to-fix-canadas-ibm-payroll-debacle-soar-past-savings-436656
Before I retired from IBM last year, I used to tell my managers that if customers knew what was going on inside IBM, they’d run the other way. Case in point: when Palmisano rose to prominence 15 years ago, there was much ado about autonomic computing and ‘utility’ computing, ie, systems managing themselves. There were Systems Journal articles etc. Much ado about nothing – 15 years later service management was still using an extremely labor intensive checklist called Server Activation/Deactivation (SAD – they sure can pick ’em) to ensure everyone involved had done their jobs. A couple of years before I retired, I went to an IBM internal dinner, and the keynote speaker was a VP from Watson(lab) involved in cognitive computing. As luck would have it, I wound up sitting next to him. He told me that they are given a hurdle rate(at least 50% ROI) before projects are green lighted. I responded that IBM labs invented the cell phone, quantum computing, and the lasers used today for eye surgeries – blue sky research that (at the time) would never have cleared such a hurdle. He looked at me dolefully. BTW, Watson emerged out of research into natural language parsing/processing(NLP) 10 years ago, and to the delight of the marketers who run the company, won Jeopardy, now already five years ago, and was sold as all things to all men. The guy who ran that project left the company shortly thereafter. And Bob, we are not tired of your writing about a company that was once the paragon of American business, and can be seen as the harbinger of much else wrong with American Business – because it drinks its own kool aid but doesn’t eat its own dog food.
What would Carrie Underwood’s success teach us about Kickstarter failures? I hate to thread-jack, but really, you can post here but you can’t follow through on your promise of a weekly update?
I knew the answer to the title would be ‘nothing’, and sure enough Carrie Underwood is totally unrelated.
It has happened in other seasons where a clear favorite gets voted down. Adam Lambert came in next to last one week as fans seemed to be getting lazy. I wonder if they rigged the totals just to remind people to vote. He would have been last if the judges hadn’t saved the last place person a few weeks prior, and the other contestant who was sent home would have definitely excelled that week.
Jennifer Hudson was voted out early as there were 3 black women who were the clear top 3, with Jennifer the best, but they split the votes and were the bottom 3 one week.
Google buying Apigee today is more bad news for IBM. Apigee had already been taking lots of API business (and technical people) away from IBM, as they have the better API cloud product, but now they have that plus corporate viability. There goes even more IBM revenue, and of course will mean associated RAs/layoffs/firings.
As someone who has worked with IBM over the last decade or so, I find your assessments of IBM generally accurate and poignant and, frankly, a relief to hear. It is disheartening to see the amount of nonsense IBM is allowed to get away with, for what was once a serious company (it is also disappointing to see the press regurgitate this nonsense daily).
I also think the premise that Watson is a losing bet: marketing their desperation at having totally lost the cloud computing segment (so they had to invent cloud “cognitive” computing so that they could be a leader in something – make belief).
However, I think the journalism (not the analysis) in the case of this article is disappointing.
Are you sure the numbers you are showing are Watson registrations? What does that even mean given that Watson is not one thing even in IBM’s eyes?
I am thinking those are more likely to be number of registrations to World of Watson and nothing to do with Watson itself.
Did you make any attempt to verify the leaked information with IBM?
I hope you dig deeper and publish a retraction if it turns out you were wrong (and if you are not can you please explain the stats a bit more? And if they are WOW registration numbers, it is still a big story, albeit a different one).
You are an important beacon both for accurate assessment of IBM and in creating hope that if IBM’s investors understand what is happening they may still be able to save the company (which, let’s face it, is still deeply embedded in our daily lives). In this case though, your key facts are more than likely not what you think they are…
http://kickscammed.com/project/mineserver-where-art-thou/
Complaints are already being filed with the FTC
https://www.cringely.com/2015/09/29/the-cringely-boys-kickstart-mineserver-a-99-minecraft-server/
https://www.kickstarter.com/projects/583591444/mineservertm-a-99-home-minecraft-server/description
I suspect the exact same thing is happening with the current polling data. Trump is indeed as ridiculous of an idea as we expect. he is over 5 points down and down in most/all swing states. The election is effectively over. But there’d be no ad buys and the media biz would lose at least 10% of their entire income maybe much more. so, they just won’t tell us except for a few outliers like Nate Silver and the betting sites which put things basically over.
Nate Silver puts the chances over 30%. Lots of people are thinking no chance, when lots of 20% chance events happen regularly.
I have a very sick feeling Bob is right. IBM has been advertising a lot lately. The ads are only about Watson. As I watch them I keep wondering how a business would use Watson on a daily basis. How would it work? How would they set it up? How much would it cost? How much value would it bring to IBM’s customer?
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Watson is a part of one of IBM’s five new CAMSS business. What about the rest of them? Why are there no adds on cloud, mobile, social, or security? What is IBM selling with them? Then I realized something. Watson is IBM’s only uniquely IBM product or service. There are many firms who can sell you cloud, mobile, social, and security. There are firms who can help you with big data and analytics. Watson is the only thing only IBM has. Is this important?
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Is there substance behind IBM’s advertising and marketing? IBM is an $80B company with 955,000,000 shares of stock. Is there more than Watson? I am beginning to get scared.
I think it is just to give a halo effect to the rest of IBM’s services. If they can make Watson, then they can do anything.
Someday IBM staff will compete with Watson on a reality show to see who gets to keep their job; oh wait I think Donald Trump already did that – You’re fired
I hope and expect Ginny and her Management minions will get fired for Watson and other missteps. Watson is nothing but hot air at this point, not anywhere close to delivering anything useful to anyone ! But wait – here comes blockchain to save the day ! The senior management and marketing incompetents in Armonk keep trying and failing with new bumbling ideas….. And meanwhile, as Ross Perot would say, there’s a giant sucking sound……and it’s IBMer jobs on the line going down the drain. Can you spell colocation ???
>Big Blue has made the most fundamental mistake in high tech: they don’t eat their own dog food
You’re half right, Robert; they not only don’t eat their own dog food, they don’t tell everyone that it is steak.
My experience with Watson has been less than stellar. I’ve only tried one service, but the results were very mixed. Watson was not the best when it came to the particular cognitive service or the worst, it was just average. In fact, some much smaller players did a much better job.
Who is this IBM that you constantly write about?
Saving your better writing for your own blog I see. The one you posted on SA was far inferior to this one. I agree with everything you posted, Also on SA some industrious guy figured out Watson is only bringing in about 250 million. So it is not only unpopular it should be ignored by an 80 billion giant like IBM. They should refocus on stuff making money and gains, like Cloud. Regardless not the time to invest but the time to sit back get out the popcorn and watch the accident happen.
Watson is nothing but smoke and mirrors. Ideologically, the concept has profound implications. But pragmatically, as Mr. Cringley states, the horsepower to run an artificial intelligence engine of this magnitude is unsustainable. I worked on Watson for years, I know. It would make no business sense mathematically to continue investing heavily in a top heavy developmental pursuit.
Re: “But pragmatically, as Mr. Cringley states, the horsepower to run an artificial intelligence engine of this magnitude is unsustainable..” Upon re-reading Bob’s article, all he says is that Watson registrations are low, but even that statement was refuted by other posters, claiming the chart is only for registrations to a conference (in Las Vegas) about Watson. But even if it’s true that IBM’s AI attempt with Watson is a failure, it says nothing about whether another company might succeed.
Since I am more interested and knowledgeable about Ms. Underwood than IBM, I’ll comment about that. Simon Cowell famously said very early in the competition that he predicted Carrie would win and she’d outsell every other previous American Idol winner. After this came true, I marveled at his foresight. But I guess he wasn’t going too far out on a limb on that one!
http://decider.com/2016/03/22/today-in-tv-history-carrie-underwood-won-american-idol-with-weeks-to-spare-after-belting-alone/
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What a joke. The emporer has no clothes. The cloud is similar. Can’t wait for this company to die. It horrible to see it drag out like this and employees lives & talent being ruined. In marketing not a day goes by when IBM is slinging stories about Design Thinking and how brilliant they are. More fake stories trying to prop them up while they con clients. The whole thing is a Ponzi scheme.
Can someone explain in plain English what the competitive advantage is that IBM’s Watson has over other AI solutions such as the highly acclaimed Google Deep Thought acquisition ? If I was a business person, what benefit does IBM bring to the table that other AI/Machine Learning projects don’t already offer ? Are there patented proprietary algorithms ?
Gee…..reading this one wonders what IBM does right?
This is the dumbest article I’ve ever read. You’re just simply an IBM hater because you no longer work there and have bad blood.
In addition, the numbers you’ve presented absolutely false, and represent the numbers for a conference registration.
Get your facts straight, please.