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IBM's cloud computing puzzle: the era eliminates you, there is no farewell

via:博客园     time:2019/1/18 22:32:27     readed:314

图片来源@视觉中国

Text | Luo Chao

IBM once dominated the computing field, but in the 1990s, it was surrounded by Microsoft, Intel and other vendors in the PC industry chain, and suffered the most serious crisis;

Today in the cloud computing market, IBM has experienced the same crisis, this time do not know whether it can survive;

IBM's acquisition of Red Hat to Hybrid Cloud is the latest case of hardware vendors failing to do public cloud because hardware vendors don't understand cloud computing;

Centennial companies have faced many times in the face of today's rapid changes, Kodak, Nokia … …

Will the next one be IBM?

IBM

Stepping on every wave is something that any technology company has dreamed of.

But the reality is that the lifespan of most companies does not match the cycle of technological development. According to statistics from Fortune magazine, the average life expectancy of the global “500” is 40-50 years, and the average life expectancy of multinational companies is 11-12 years.

In 1911, the biplane flew in the air and the Ford Model T appeared on the street. A legendary technology company was also established this year, which is a 107-year-old IBM company that spans a century.

In the history of the technology industry's ups and downs for more than 100 years, IBM's destiny has risen and fallen, has glory and glory, and has a quiet valley. But in this wave of cloud computing technology that started in 2006, IBM is facing a difficult time.

a hundred years of glorious history

In the history of computing, IBM's mark is indelible.

In the 50s, 60s, 70s, and 80s of the last century, IBM dominated the computer industry and led the industry trend, which is almost synonymous with “computer”. In 1982, Fortune magazine began to publish the list of Fortune 500 companies, and IBM ranked first for four consecutive years.

IBM was so successful at the time that no one doubted its future. However, by the end of the 1980s, the Big Blue was in trouble.

At that time, IBM focused on mainframes and their software. These nearly monopolistic businesses were able to generate $4 billion in profits each year. The days of nourishment made IBM mistakenly believe that the computing industry is mature and there will be no drastic changes.

But later, the development of the computing industry was completely beyond IBM's expectations.

In the 1990s, IBM invested heavily in the development of personal computers, but unfortunately, it did not foresee the potential of such personal computers to grow. It was not expected that these computers could one day replace IBM's competitive mainframes and minicomputers. .

When IBM came back, it failed to control the two most valuable parts of the PC — — operating system and computing chip, the former is controlled by Microsoft, the latter is controlled by Intel.

Throughout the 1990s, in the rise of PC computing, IBM watched the rapid rise of Intel, Compaq, Apple, Sun, Hewlett-Packard, Microsoft, etc., and they could only swallow the bitter consequences of strategic decision-making mistakes.

In 1993, IBM suffered a huge loss, with losses of billions of dollars. The organization was bloated and faltering. It was facing the danger of being split. The media described it as “one foot has entered the grave”.

It was also during this year that LouisGerstner, the legendary CEO of IBM history, entered the company and began a nine-year reengineering of the company.

Under the leadership of Gerstner, IBM has undergone drastic reforms. In the end, elephants danced again and became the leader in IT services, hardware, enterprise software, and custom design and high-performance computer chips.

After being besieged by rookies in the PC era, IBM regained its glory.

The days of the cloud world are hard to find

But it’s not long before the good days, a wave of technology in cloud computing came over.

The wave of computing, which began in 2006 by Amazon, has gradually become a storm, causing a violent impact on IBM's traditional IT market.

It is said that with the lesson of missing the PC computing wave, IBM should react faster. But unfortunately, it was not until 2013 that IBM decided to increase its investment in the public cloud market.

IBM acquired SoftLayer Technologies in 2013 for about $2 billion and officially entered the public cloud market.

This is a major acquisition after IBM CEO Rome Rometty took office. At that time, the industry generally believed that IBM had a so-called role in the field of cloud computing.

While promoting the public cloud business, IBM's focus is on the company's cognitive computing platform Watson & mdash;— gaining insight through artificial intelligence and big data technologies.

As early as 2011, Watson won the quiz show Jeopardy! (risk edge), and since then IBM has been actively promoting Watson.

In the past decade, IBM has invested billions of dollars to develop the Watson platform, which it believes can help all professionals, for example, it can help doctors diagnose diseases faster, and banks can respond faster and better. Customer inquiry.

But it is counterproductive.

Although Watson, who was highly hoped by IBM, explored in the medical field, it did not go well. Until now, it has not formed a strong market competitiveness. Even some technology investors said that Watson is a joke.

Faced with a new wave of computing, IBM seems a bit unprepared, core products can not win customers, have to lay off employees to save themselves. But even more cruel is that IBM seems to be entering a leap year, and the company's revenue has set a terrible record of 22 consecutive quarters of decline.

The house leaks are even rainy. After Watson’s collapse, IBM’s betting cloud business has also been out of business since 2016.

According to market research firm IDC's tracking data, in the first half of 2016, IBM's cloud computing business can grow faster than the industry's average growth, but from the second half of 2016 to the first half of 2018, IBM's growth rate is significantly behind the industry. The overall growth rate, the market share has gradually declined. In the first half of 2018, IBM was officially overtaken by Alibaba, losing its third place in the world.

It is worth mentioning that over the past two years, IBM has been the only company among the top five cloud computing vendors that has not been able to outperform the growth of the market.

Reappeared yesterday. Now IBM is being besieged by Amazon AWS, Microsoft, Alibaba, Google and other vendors in the public cloud market, just like the PC era.

IBM needs to zoom in and find out.

Hardware cloud facing challenges

At the end of October 2018, IBM took the shot.

IBM announced that it will acquire Red Hat, an open source software vendor, for $34 billion, hoping to make a difference in the hybrid cloud market. IBM is very savvy, and people are seeing the anxiety of the Big Blue in the cloud computing market.

This time, Luo Ruilan took the home of IBM and his career. Once the acquisition, IBM's performance has not improved, she must leave.

After the acquisition of Red Hat, IBM's so-called hybrid cloud market strategy means that the company will cooperate with cloud computing vendors such as AWS, Microsoft and Alibaba in the future.

Technology industry analyst Ben Thompson said:

“The most important thing about the acquisition of Red Hat is that IBM acknowledges that public cloud efforts have actually failed. ”

IBM is not the first hardware company to smash in the public cloud market. Prior to IBM, many established hardware equipment vendors, such as Cisco, Hewlett-Packard, and Fujitsu, were eager to try in the public cloud market, but in the end they all quit because of the lack of competitiveness in technology, services, and operations.

IBM is a banner for hardware vendors. Where is the future of hardware vendors? How to transform? The entire hardware vendor industry is watching IBM's every move. Now I'm afraid it gives the endings that all hardware vendors don't want to see —— the decline of a generation of hardware vendors.

The biggest reason for hardware manufacturers to do public cloud collective fall is that they do not understand the nature of cloud computing. The essence of cloud computing is not "calculation", but service. Hardware vendors are better at making hardware and selling devices, and they are missing too much on the "service".

Today, the hegemons of the public cloud market are companies with Internet experience like Amazon AWS, Microsoft, Alibaba and Google. They are occupying more and more market share, and the market concentration is constantly increasing, continually squeezing the market share of the lower ranking manufacturers.

Wall Street investment bank Goldman Sachs believes that the cloud market has begun to integrate, this trend will only be more significant in the next few years, the public cloud market will be integrated into an oligarchy. According to Goldman Sachs, the market share of several oligopolistic manufacturers will reach 84% by 2019, and the opportunities for latecomers will become smaller and smaller.

As the cloud computing market matures, there is not much time left for IBM to adjust. At this point in time, IBM needs to get used to the new generation, let go of the body to learn and compete with these vendors.

A hundred years of business can not escape fate? What is fate?

IBM has long been regarded as a symbol of US technological strength and a bastion of national competitiveness, and even the Economist pointed out that “IBM's failure is always seen as a failure of the United States”. In the past century, IBM has experienced many waves of technology, but this time the technology wave, whether it can survive safely is still unknown.

In this era, the changes are fast and fierce at any time. If we still adapt to this era according to the survival experience of the previous era, it will definitely not work.

The times have changed, and many companies have changed their names to become common tricks in order to show that they have to adapt to the times. In history, people first added an "Electronic" to the name, and then "Network", and today is "Cloud" or "Artificial Intelligence". Anyway, the concept is fashionable, they are added in the name. what. In fact, in the back, they are still doing things in accordance with past habits, and they have vacated the tide.

Over the past decade or so, we have witnessed the fall of many companies with a history of 100 years. Kodak, a well-known camera company that was founded 137 years ago, fell because it did not dare to use digital photography to revolutionize its own life. Nokia, a 153-year-old Finnish company, has done business in papermaking, rubber, and communications because it missed the wave of smartphones and disappeared. In the public eye.

Although these companies have gone through hundreds of years and their business has been continuously innovated, they are finally unable to escape the fate of failure. Now that they have come back, there are different reasons for the fall of these companies, but the common thing is that they have not kept up with the rhythm of the times.

The author of The Innovator's Dilemma has pointed out that the list of well-known companies that have failed in the face of disruptive technological changes and market structure changes is very long. In some cases, new technologies will hit the industry in a very short period of time; in other cases, the transition period will last for decades. But the sure thing is that once you can't adapt to such a change, it will be inevitable.

IBM

This is the Fairchild Ba Ren Gang, “half of the 70 semiconductor companies in Silicon Valley, and is a direct or indirect descendant of Fairchild. ”

Just like human beings, corporate death is inevitable, and this is an objective law. But death is the best invention in life because it accumulates energy and shines again in another form —— coal is not a plant that has accumulated solar energy in ancient times. Just like Fairchild and the legend of “eight rebellious”, a fairy child is fallen and thousands of fairy tales stand up. It must be said that IBM has actually cultivated a large number of talents, and they are now struggling with companies that are in the midst of a wave.

The torrent of the times has been rolling forward. When the era eliminates you, you won’t even say a farewell. What you need to do is to follow the trend and try to catch every wave you encounter.

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