“We can‘t be essential unless our partners are skilled in our products and confident in going to their clients with our products and selling them with us and for IBM,” IBM channel chief Kate Woolley said.
IBM has started giving registered members of its PartnerWorld program access to the training, badges and enablement IBM sales employees get along with a new learning hub for accessing materials.
The expansion is part of the Armonk, N.Y.-based tech giant’s investment in its partner program, IBM channel chief Kate Woolley told CRN in an interview.
“We can‘t be essential unless our partners are skilled in our products and confident in going to their clients with our products and selling them with us and for IBM,” said Woolley (pictured), general manager of the IBM ecosystem.
[RELATED: Channel Chief Kate Woolley: ‘No Better Time To Be An IBM Partner’]
Partners now have access to sales and technical badges showing industry expertise, according to a blog post Tuesday. Badges are shareable on LinkedIn and other professional social platforms. IBM sales representatives and partners will receive new content at the same time as it becomes available.
“This is the next step in that journey in terms of making sure that all of our registered partners have access to all of the same training, all of the same enablement materials as IBMers,” Woolley told CRN. “That’s the big message that we want people to hear. And then also in line with continuing to make it easier to do business with IBM, this has all been done through a much improved digital experience in terms of how our partners are able to access and consume.”
Among the materials available to IBM partners are scripts for sales demonstrations, templates for sales presentations and positioning offerings compared to competitors, white papers, analyst reports and solution briefs. Skilling and enablement materials are available through a new learning hub IBM has launched.
“The partners are telling us they want more expertise on their teams in terms of the IBM products that they‘re able to sell and how equipped they are to sell them,” Woolley said. “And as we look at what we’re hearing from clients as well, clients want that. … Our clients are saying, ‘We want more technical expertise. We want more experiential selling. We want IBM’ – and that means the IBM ecosystem as well – ‘to have all of that expertise and to have access to all the right enablement material to be able to engage with us as clients.’”
The company has doubled the number of brand-specialized partner sellers in the ecosystem and increased the number of technical partner sellers by more than 35 percent, according to IBM.
The company’s accurate program changes have led to improved deal registration and introduced to partners more than 7,000 potential deals valued at more than $500 million globally, according to IBM. Those numbers are based on IBM sales data from January 2022 to August.
Along with the expanded access to training and enablement resources, Woolley told CRN that another example of aligning the IBM sales force and partners was a single sales kickoff event for employees and partners. A year ago, two separate events were held.
“I want our partners to continue to feel and see this as a big investment in them and representative of how focused we are on the ecosystem and how invested we are,” she said.
Microsoft and Kyndryl have unveiled a new aspect of their global strategic partnership with plans to help enterprise customers make better use of data held on mainframe systems.…
According to Kyndryl, the services outfit has worked with Microsoft in order to enable data pipelines between mainframe systems (including Kyndryl's zCloud platform) and Microsoft's Azure cloud, intended to make it easier for customers to move data stored on their mainframes to a cloud environment for analysis.
Kyndryl is the former IT infrastructure services division of IBM, which Big Blue spun out last year, and so it would be ironic if it were now helping IBM customers to ditch the mainframe – though the reality is more complicated than that, of course.
The zCloud platform is Kyndryl's managed multi-tenant mainframe cloud service.
Microsoft and Kyndryl announced the formation of their trade relationship within days of the Kyndryl spinoff being finalized last year. However, the company now has agreements with all three of the big cloud providers.
The purpose of this new arrangement is for Kyndryl to help enterprise clients squeeze more value from their mainframe data by connecting it with the Microsoft Power Platform, various cloud-based tools that Redmond offers which combine low-code application development and workflow automation with existing services such as Power BI.
In a short video, Kyndryl's VP and CTO for zCloud Richard Baird discloses how the company has linked its zCloud platform and Microsoft Azure. It involves deploying an Azure Stack HCI environment alongside a mainframe in one of Kyndryl’s zCloud Centers, or a customer’s own datacenter, then using that as the integration point between the mainframe and the Microsoft Power Platform.
Integrating cloud-based functionality with the mainframe not only preserves the value of existing enterprise IT investments, but enhances them to enable faster digital transformation, Kyndryl claimed, which hints that it doesn't quite see the mainframe going away just yet.
Instead, Kyndryl talked up the creation of a hybrid environment that makes mainframe data available via Azure and opens it up to the benefits of cloud-based applications, machine learning and AI. What this means is that - in theory - mainframe customers can choose the right platform for the right workload, it said.
"Microsoft's AI-enabled Power Platform capabilities, Kyndryl's rich mainframe ecosystem, and managed services experience are a strong combination that will help customers unlock their mainframe data," said Microsoft's VP for Global System Integrator and Advisory Partners, Kelly Rogan.
Kyndryl and Microsoft said they also plan to combine mainframe data with other internal and external cloud-based data sources, in order to let customers create new applications that make use of modern analytics and visualization tools.
As part of the joint mainframe modernization initiative, Kyndryl said it will offer consulting and integration services to help customers more easily and efficiently plan, design, and connect mainframe data to Azure Cloud and Edge Computing environments. ®
I think IBM has had a good run, [and] not all companies last forever. There is a life cycle to a company. They are born [to] grow and then decline. They [IBM] have been in decline for 10 or 12 years...When you’re 75, you’d love to be 35 again, but you’re not going to...So that’s the way I think of aging companies. Trying to turn them around might be the most dangerous thing you can do. - Aswath Damodaran, July 22, 2017
I included the quote above in one of my prior IBM (NYSE:IBM) analyses back in early 2020 when I took an in-depth look at the firm’s newer (at the time) hybrid cloud and artificial intelligence (“AI”) strategy. It’s strong, if understandable logic. But, in the particular case of IBM, is it accurate?
With IBM’s earnings date set for next Wednesday, October 19 to report Q3 FY ‘22 results, investors might wonder if Dr. Damodaran is right. If we were only to consider the share price, his words might seem prescient since the stock was trading around ~$140/share at the time the article from which the quote was referenced was published; as compared to today’s close of $117.57. In fact, the stock has barely nudged above $140/share over the last 18 months.
Data as of market close October 12, 2022.
Yet, 2022 has proved to be a reasonably good year for IBM…so far.
As other Seeking Alpha authors have noted, the stock has held up fairly well, dropping “only” ~(14%) YTD as compared to ~(25%) YTD for the S&P 500.
Q2 FY ‘22 revenue of $15.5B reflected 16% growth versus the prior period in constant currency.
The revenue performance in Q2 FY ‘22 demonstrated strength across all geographies and the company’s key operating segments, namely software, infrastructure, and consulting.
The software, infrastructure, and consulting segments racked up sales of $6.2B, $4.2B, and $4.8B respectively during the quarter, reflecting growth of 12%, 25%, and 18% respectively versus the prior period in constant currency.
TTM hybrid cloud revenue stood at $21.7B at the end of the quarter, up 19% in constant currency.
YTD cash from operating activities was $4.6B at the end of Q2 FY ‘22, driving YTD free cash flow of $3.3B.
Management’s confidence exiting Q2 FY ‘22 allowed CEO Arvind Krishna to reaffirm full-year guidance noting that "[with] our first half results, we continue to expect full-year revenue growth at the high end of our mid-single digit model.” Free cash flow for the full-year is expected at $10B.
With the foregoing in mind, we might predict a strong Q3 FY ‘22 performance as well. But, recently lowered price targets by several analysts might hint that dark clouds may have already formed over IBM’s 2H FY ‘22.
To put IBM bulls at ease, recently lowered price targets by two analysts reflect a minor “trimming”, with both maintaining their buy ratings.
However, UBS Group, who had previously slashed their price target from $136/share to $124/share in early January, did so again dropping their price target to $112/share while maintaining a sell rating.
UBS analyst David Vogt had suggested early in the year that the firm was trading at “...an ‘elevated valuation’ [leaving] the shares ‘vulnerable’ over the next 12 months”.
The contrast between UBS and Morgan Stanley/Credit Suisse above could not be starker. Even without practicing their research notes, we might assume the Morgan Stanley and Credit Suisse analyst teams are pleased with the performance of the core business, even if they are dropping their price targets a bit. And, on that point, I think there are reasons to be bullish.
1. IBM Consulting demonstrating strength.
During the recent Goldman Sachs Communacopia and Technology Conference, John Granger, Senior Vice President of IBM Consulting, noted that “[IBM is] a big consulting player…[with] 150,000 professionals across the world. Revenue is approaching $20 billion. And within the IBM family, [consulting is] about a third of IBM’s revenue, but nearly two-thirds of IBM’s people.” As customers, particularly large enterprises, evolve existing legacy systems and/or digitize non-digital processes, they will draw upon such services as provided by IBM Consulting, including business transformation and technology consulting. These engagements are typically high-margin and high-value, often driving revenue in other parts of the business. Hence, as Mr. Granger also pointed out, the segment is extremely important with respect to IBM’s ongoing success.
There are not many companies that can do what IBM is capable of doing via its IBM Consulting segment. To reiterate the statistic that Mr. Granger mentioned, the organization reflects two-thirds of IBM’s entire employee headcount. The ability to put a large number of “feet-on the-ground” for a given project is somewhat unique to IBM, as it is for key consulting competitors like Accenture (ACN) and Cognizant (CTSH).
2. IBM has found its footing again in the APM and Observability space.
IBM’s acquisition of Instana in 2020 gave the company a boost in the large, multi-billion dollar application performance management (“APM”) market. Consider IBM’s position in Gartner’s APM Magic Quadrant from March 2019 versus their Magic Quadrant for June 2022 below.
As a leader, it is noteworthy to see IBM ranked higher, overall, than Cisco’s AppDynamics and Splunk, among others. Quoting myself from a prior article on Datadog (DDOG), “...the architecture of modern applications is radically different from even just 10 years ago – they are far more complex with many ‘moving parts’ that may reside in one or more clouds, and/or in on-premise environments.” This complexity – which is increasing in many ways – drives the need for APM solutions, and I theorized in the same article on DDOG that investors might see a certain resiliency within that market despite the economic slowdown. Time will tell if I am right about that. But, the point is that it is a large market, growing double-digits year-on-year by some estimates, and IBM is well-positioned to grow with it.
3. Management’s move deeper into security and automation technologies is a smart move.
During the Q2 FY ‘22 Earnings Call, Mr. Krishna noted that “[given] the importance of cybersecurity, in this past quarter, we also acquired Randori, a leading attack surface management, and offensive cybersecurity provider. This builds on the accurate acquisition of ReaQta and the launch of QRadar XDR.” As the computing environments become more complex (see the prior point), security becomes that much more difficult. I think management shows good judgment pushing further into the security space as it is somewhat hard to imagine enterprises spending significantly less on security regardless of economic conditions. Automation is also front-of-mind for many organizations today as they attempt to streamline routine workflows and free-up employees to focus on more strategic work. Accordingly, Mr. Krishna explained that “[this] is one of the many reasons we are investing heavily in both AI and automation.” AI plays a key role in IT operations today, with Gartner inventing the term “AIOps” to refer to the combination of “artificial intelligence” and “IT operations”. On that basis, IBM would seem well positioned to capture a significant share of the fast-growing AIOps market via its tooling.
While we see the automation and security sub-segments only posting single-digit growth in Q2 FY ‘22 as per Figure 7, I would expect the growth rates of both businesses to increase moving forward due to the nature of those particular markets.
So, with reasons to think the core business still has some life left in it, is UBS too bearish with their call?
IBM’s revenue and EPS estimates are seen in the table below, along with the glaring marker of 13 downward revisions in the last 90 days.
With analysts clearly expecting a weaker performance, investors might keep a few other points in mind.
1. Q3 tends to be a weaker quarter for IBM.
As readers likely know, Q4 tends to be the strongest quarter for many technology companies. Such is the case with IBM as well; and thus history does not play in the company's favor heading into Q3 FY ‘22 results. Investors might also remember that the company missed its Q3 FY ‘21 estimates.
2. The Red Hat business is decelerating.
Red Hat sales growth in Q2 FY ‘22 declined to 12% versus the prior period which saw a growth rate of 20%. Although, both growth rates were identical at 17% adjusting for currency. Still, with a Red Hat growth rate of 21% in Q1 FY ‘22, this is not a trend that investors want to see considering that IBM bet the farm to a certain extent on Red Hat. Of course, it’s premature to declare that the business is in trouble. But, investors will certainly want to pay attention to the business’ results when Q3 FY ‘22 earnings are announced.
3. The hybrid cloud and AI strategy may be weaker than some investors think.
On the surface, IBM’s stated hybrid cloud and AI solutions strategy would seem to be gaining traction in the context of Q1 FY ‘22 and Q2 FY ‘22 results, with revenue growing 11% and 16% respectively versus the prior periods in constant currency. Mr. Krishna mentioned during the company’s Q2 FY ‘22 Earnings Call that the firm had more than 4,000 hybrid-cloud clients at the end of Q2 FY ‘22, including more than 250 added in the quarter itself. Of course, this is a bullish signal and it reinforces uptake of IBM’s architectural model centered on Red Hat Enterprise Linux, containers, and orchestration. However, we might also argue that 4,000 hybrid-cloud customers might seem a little low, especially as IBM has been talking about hybrid-cloud as far back as its Annual Report FY ‘11. I think this shows that while IBM correctly foresaw an evolution of the cloud into a “multi-cloud” as it pertains to how enterprises would deploy and run applications, there are any number of supporting technology stacks to support multi-cloud application environments, some of which might feature IBM technologies and some which feature none at all. There is a somewhat analogous story with respect to AI. The AI market is composed of innumerable players, many with specializations in particular sub-fields under the AI umbrella. Accordingly, it is an incredibly competitive space, sometimes characterized by a lack of compelling differentiation between competing solutions. While IBM is still regarded as a leader in AI by some, remember that their grand vision for IBM Watson never really came to fruition. This is all to say that IBM’s stated strategy may not be all that strong, especially in consideration of the prior point discussing the deceleration of the Red Hat business.
Having worked at IBM during my enterprise software career, I would lean toward the typical weakness seen in Q3 possibly driving a miss on both lines. Couple that with the possibility of emerging weakness in the firm’s strategy along with economic headwinds, and the outlook becomes somewhat gloomy. Maybe UBS was right.
As UBS lamented, IBM’s share price did not offer investors any kind of grand bargain early in the year; nor is it wildly cheap even after its YTD decline.
Data as of market close October 11, 2022.
Data from Polygon.io except P/S, P/B, and P/E data from Yahoo Finance; as well as ORCL and HPE gross margin data also from Yahoo Finance.
At the same time, it’s not wildly expensive either. As mentioned in the previous section, I do think Q3 FY ‘22 might be a bit rough, if only because it often is. But, with the idea that the “future” of the core business may be powered to a greater extent by IBM Consulting, and that IBM’s deeper push into APM, security, and automation may offset weakness elsewhere, I think it makes sense to hold the stock even with the threat of a weaker-than-expected Q3. Again, Q4 tends to be IBM's strongest quarter so if the stock dips following Q3 earnings, there’s a good chance it can recover following Q4.
I deliberately referred to IBM as a “service integrator”, rather than a “technology company”, in the title of this section because I tend to think of the firm more and more as a service integrator with technology, as opposed to a technology company with services. Services have been a core part of IBM’s business for decades; and I am betting services will drive a majority of revenues in the not too distant future. And, I actually think that’s a good thing because I personally think that’s where IBM excels. With Kyndryl (KD) spun out, I wouldn’t be surprised if IBM continues to slim itself down even more, perhaps with IBM Infrastructure the next to go.
Responding to the question I posed about Dr. Damodaran’s quote in the introduction: he’s probably right. But, that doesn’t necessarily mean investors can’t profit off an investment in the company. I think IBM’s core business will continue to throw off cash for a long time to come; and the stock likely will suit income investors just fine during that time.
Upcoming Q3 FY ‘22 results might leave investors wanting, but I think they owe themselves a longer-term perspective on the company’s forward prospects.
“No matter how our partners are focused or how they‘re going to market, we want our IBM technology to be going to market with them,” IBM channel chief Kate Woolley said.
Opening to partners training and enablement resources usually reserved for IBM’s own employees is an example of how the company is investing in partners and becoming easier to work with, channel chief Kate Woolley told CRN in an interview.
And while the IBM Consulting division continues its own investments with its ongoing purchase of services businesses, those investments pose no conflict to partners, said Woolley, general manager of the IBM ecosystem.
“As we think about IBM with IBM Consulting and IBM technology, we want our partners – no matter how our partners are focused or how they‘re going to market, we want our IBM technology to be going to market with them,” Woolley said.
On Tuesday, the Armonk, N.Y.-based technology giant started giving registered members of its PartnerWorld program access to the training, badges and enablement IBM sales employees get, along with a new learning hub for accessing materials.
Partners now have access to sales and technical badges showing industry expertise, according to a blog post Tuesday. Badges are shareable on LinkedIn and other professional social platforms. IBM sales representatives and partners will receive new content at the same time as it is made available.
“This is the next step in that journey in terms of making sure that all of our registered partners have access to all of the same training, all of the same enablement materials as IBMers,” Woolley told CRN. “That’s the big message that we want people to hear. And then also in line with continuing to make it easier to do business with IBM, this has all been done through a much improved digital experience in terms of how our partners are able to access and consume.”
Although IBM spun off its managed infrastructure practice into a separate, publicly traded company called Kyndryl, the remaining IBM Consulting wing remains a big part of IBM’s business. IBM reported consulting revenue of $4.8 billion in its latest quarterly earnings, up from $4.4 billion from the same period a year prior.
“I don‘t see conflict versus IBM consulting,” Woolley said. “I honestly don’t see that conflict. I think we want to be going to market with all of our partners regardless of what motion they‘re taking it through.”
Here’s what else Woolley had to say.
Customer Identity & Access Management (CIAM) , Security OperationsConsumerization of IT Has Brought CIAM Methods, Technologies to Workforce IAM Space
Perennial leaders ForgeRock, Ping Identity and IBM, along with a surging Okta, set themselves apart from the pack of CIAM vendors in the latest report by KuppingerCole analysts.
See Also: Building a Secure IoT Deployment Using 5G Wireless WAN
Ping Identity leapfrogged ForgeRock to capture the gold in product leadership, and IBM once again took the bronze. ForgeRock, Ping Identity and IBM maintained the gold, silver and bronze, respectively, in innovation leadership. And in the market leadership category, Microsoft again took gold, Auth0 catapulted from seventh to second place in market leadership due to becoming part of Okta, and SAP fell from second to third since the last report in late 2020, KuppingerCole found.
"The trend toward digitalization of consumer experiences was well underway in the late 2010s, and the COVID pandemic forced more businesses and other organizations to expedite digital transformation," John Tolbert wrote in the 120-page report. "With every iteration of this report, we observe significant acquisitions of CIAM specialists by others in the market, and entry into the market of new vendors."
Microsoft, Okta and IBM were the three market share leaders in the broader $13.6 billion identity and access management category last year, while Ping Identity and ForgeRock captured ninth and 10th place, according to IDC. Thoma Bravo has acquired SailPoint and plans to buy Ping and ForgeRock. Should the three companies be combined, it would take the bronze in market share, narrowly edging out IBM.
"Innovation in CIAM drives the wider IAM market," Tolbert wrote. "The 'consumerization of IT' is exemplified by the push to use CIAM methods and technologies for registration, authentication, and authorization in workforce IAM. Features that were considered innovative in the previous edition of this report are going mainstream."
Outside of the top four, here's how KuppingerCole sees the CIAM market:
The latest rankings represent a drop for SAP and WSO2, which fell from third to fifth and eighth to 10th, respectively. Microsoft and OneWelcome leapt from ninth to seventh and 10th to ninth, respectively. LoginRadius held steady in sixth place, while Transmit Security - which raised $543 million last year - is new to the list.
"The CIAM market is growing and there is room for much further expansion, with many vendors offering mature solutions providing standard and deluxe features to support millions of users across every industrial sector," Tolbert wrote. "Some vendors have about every feature one could want in a CIAM product, while others are more specialized, and thus have different kinds of technical capabilities."
|IBM||Lighthouse Security Group||Not Disclosed||August 2014|
|Ping Identity||UnboundID||Not Disclosed||August 2016|
ForgeRock in April refreshed the user interface around its authentication app to Improve the customer experience, add functionality for facial biometrics, and leverage capabilities from Apple and Android, according to CEO Fran Rosch. He says ForgeRock has sought smarter ways to identify legitimate users and supply them access by leveraging AI to collect signals of typical user and device behavior.
Once ForgeRock has collected patterns around a typical positive user experience, the company develops a risk score to supply customers more confidence about whether a legitimate user is attempting to log in. To prevent account takeover fraud, ForgeRock has factored in both known threats and threats projected via AI into its risk score and has incorporated more information about device behavior into its app (see: Thoma Bravo Identity Push Continues With $2.3B ForgeRock Buy).
"CIAM has got a strong security component, but also a strong usability component," Rosch tells Information Security Media Group. "And we've always worked to embed that capability of self-service and ease of use into the platform."
KuppingerCole criticized ForgeRock for implementation challenges around the on-premises version and a lack of native marketing analytics, marketplace integrations and certification around FIDO. Rosch says ForgeRock has focused on simplifying the deployment of its on-premises offering by crafting DevOps capabilities for implementation, simplifying upgrades and creating new configurable AI for the platform.
"Every company's got room to improve," Rosch says. "Generally, we would agree with those areas identified by KuppingerCole. We're continuing to work and to improve."
Over the past five years, Ping Identity has migrated all of its core capabilities to the cloud, meaning customers don't have to deal with infrastructure, management or upgrades and can focus on the user experience, says Dustin Maxey, vice president of product and solutions marketing. Having everything available as a multi-tenant, SaaS-based offering means Ping can support customers' various deployment options, he says.
Maxey says Ping has defined and developed workflows for CIAM scenarios such as account registration and fraud detection that incorporate both native and third-party capabilities and are easy for customers to use. Over the past year, Ping has made real progress on decentralized identity and combining multiple fraud signals in one place so that risk and fraud can be assessed at the point of authentication, he says (see: Ping Identity to Go Private in $2.8B Thoma Bravo Acquisition).
"A lot of competitors will have orchestration platforms, but Ping really differentiates in that we fully embrace this open mentality," Maxey tells ISMG. "If you want to use competitive services - if you want to use ForgeRock authentication or Okta authentication - we can plug that authentication service into our orchestration platform that we created."
KuppingerCole criticized Ping for its inability to collect device attributes, customization requiring for consent handling, and lack of simple connectors for BI, CRM, marketing analytics and automation. Maxey says Ping has focused on building the most important connectors first and wants to create deep integrations within its existing connectors before pivoting to construct new connectors.
"We are on a tear to build connectors that are deep, that are numerous and that are the ones that represent the services that our customers work with," Maxey says. "And we are moving very, very fast at that."
IBM has actively participated in committees and bodies that manage protocol support to help clients better manage API and authentication requests in applications, says Wesley Gyure, director of product management for IBM Security. Offering support for both old and new protocols gives clients a seamless experience across apps in legacy infrastructure as well as modern web-based applications in the cloud.
Gyure says the company has integrated its CIAM offering with threat intelligence to get more visibility into everything from compromised passwords to potential malicious account takeover and the opening of fraudulent accounts. Identity threat detection and response starts with determining whether to block or challenge a registration request based on if the IP address is known and if the device could be malicious (see: IBM Buys Startup Databand.ai to Address Data Quality Issues).
"We have very large Fortune 500 clients that are using our systems, both legacy and off-prem," Gyure tells ISMG. "Auto manufacturers, retail, state and local government - they all have millions of users that are authenticating to our system, and they're doing so in a frictionless way and they're doing so with high throughput."
KuppingerCole chided IBM for complicated licensing, limited configurations for family management, and no built-in identity proofing or out-of-the-box consumer device management portals. The complexity stems from thousands of customers already using CIAM in large deployments, and Gyure says a pricing calculator for the newest tools should supply clients visibility and transparency into how IBM licenses.
"We're not going to be the experts in every area," Gyure says. "Customers already have investments in solutions that they're using, and those investments have to integrate into whatever CIAM solution they may choose. This is not a rip-and-replace conversation. We want to make this easy and consumable, and to do that means to leverage capabilities and investments that they may already have."
Okta has made strides to enable app builders to better manage user authentication at scale by enabling developers to add another layer of access controls that's more fine-grained and consistent across apps, says Matt Duench, senior director of product marketing. The company's flow editor allows for no-code integration with firms such as Duo directly into the platform by leveraging a drag-and-drop interface.
Duench says the company has debuted a deployment option in Microsoft Azure so that customers in Europe and elsewhere can deploy in the environment that makes the most sense for them. Okta has strengthened its account takeover prevention capability through investments in Credential Guard and has reduced bot attacks by 79% by incorporating machine-learning upgrades in its bot detection engine (see: Okta-Auth0 Sales Integration Falters, Fueling Staff Turnover).
"We were born in the cloud, and so we're really well suited for companies that are focused on digital transformation and cloud migration versus more of an on-prem system," Duench tells ISMG. "And that's because a lot of the flexibility that now you get from a cloud-based system you can get within our platform as well."
KuppingerCole criticized Okta for a lack of built-in behavioral biometrics, FIDO certification, and ability to collect device intel via mobile SDK. Okta says there are regulatory, privacy and technology constraints around capturing device intel via mobile SDK in consumer applications and that the company chose to allow customers to integrate Okta's CIAM tool with the behavioral biometrics technology of their choice.
"You need a cloud-based platform that is extensible, that is unified and that is neutral so that you can really allow the application builder to build those use cases in the way and using the methodologies that they're traditionally used to," Duench says.
A four-year bachelor’s degree has long been the first rung to climbing America’s corporate ladder.
But the move to prioritize skills over a college education is sweeping through some of America’s largest companies, including Google, EY, Microsoft, and Apple. Strong proponents say the shift helps circumvent a needless barrier to workplace diversity.
“I really do believe an inclusive diverse workforce is better for your company, it’s good for the business,” Ginni Rometty, former IBM CEO, told Fortune Media CEO Alan Murray during a panel last month for Connect, Fortune’s executive education community. “That’s not just altruistic.”
Under Rometty’s leadership in 2016, tech giant IBM coined the term “new collar jobs” in reference to roles that require a specific set of skills rather than a four-year degree. It’s a personal commitment for Rometty, one that hits close to home for the 40-year IBM veteran.
When Rometty was 16, her father left the family, leaving her mother, who’d never worked outside the home, suddenly in the position to provide.
“She had four children and nothing past high school, and she had to get a job to…get us out of this downward spiral,” Rometty recalled to Murray. “What I saw in that was that my mother had aptitude; she wasn’t dumb, she just didn’t have access, and that forever stayed in my mind.”
When Rometty became CEO in 2012 following the Great Recession, the U.S. unemployment rate hovered around 8%. Despite the influx of applicants, she struggled to find employees who were trained in the particular cybersecurity area she was looking for.
“I realized I couldn’t hire them, so I had to start building them,” she said.
In 2011, IBM launched a corporate social responsibility effort called the Pathways in Technology Early College High School (P-TECH) in Brooklyn. It’s since expanded to 11 states in the U.S. and 28 countries.
Through P-TECH, Rometty visited “a very poor high school in a bad neighborhood” that received the company’s support, as well as a community college where IBM was offering help with a technology-based curriculum and internships.
“Voilà! These kids could do the work. I didn’t have [applicants with] college degrees, so I learned that propensity to learn is way more important than just having a degree,” Rometty said.
Realizing the students were fully capable of the tasks that IBM needed moved Rometty to return to the drawing board when it came to IBM’s own application process and whom it was reaching. She said that at the time, 95% of job openings at IBM required a four-year degree. As of January 2021, less than half do, and the company is continuously reevaluating its roles.
For the jobs that now no longer require degrees and instead rely on skills and willingness to learn, IBM had always hired Ph.D. holders from the very best Ivy League schools, Rometty told Murray. But data shows that the degree-less hires for the same jobs performed just as well. “They were more loyal, higher retention, and many went on to get college degrees,” she said.
Rometty has since become cochair of OneTen, a civic organization committed to hiring, promoting, and advancing 1 million Black individuals without four-year degrees within the next 10 years.
If college degrees no longer become compulsory for white-collar jobs, many other qualifications—skills that couldn’t be easily taught in a boot camp, apprenticeship program, or in the first month on the job—could die off, too, University of Virginia Darden School of Business professor Sean Martin told Fortune last year.
“The companies themselves miss out on people that research suggests…might be less entitled, more culturally savvy, more desirous of being there,” Martin said. Rather than pedigree, he added, hiring managers should look for motivation.
That’s certainly the case at IBM. Once the company widened its scope, Rometty said, the propensity to learn quickly became more of an important hiring factor than just a degree.
This story was originally featured on Fortune.com
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Founded in 1911 as a Computing-Tabulating-Recording Company, International Business Machines (IBM) needs to keep its finger on the pulse of the development of information technology not to be ousted by younger tech giants like Google, Microsoft, Apple, and Amazon. With the advent of the internet, IBM needed to widen the spectrum of its products and services to retain its strong position in the tech field. Although the company lost its dominance, having only a 5% market share in 2021, as opposed to 68% shared by Microsoft, Amazon, and Google, it has many spectacular achievements to its credit. IBM holds more patents than any other technology company and takes pride in employees who have earned five Nobel Prizes, four Turing Awards, five National Medals of Technology, and five National Medals of Science. And it had been the top tech company for longer than any of the titans dominating the market now.
Also called “Big Blue,” IBM indeed has an impressive pedigree. After starting to produce hardware at the beginning of the last century, it thrived in this business for decades and became the leading supplier of mainframe computers worldwide. IBM’s gross income had inexorably grown in the last part of the twentieth century, expanding from $14.450 billion earned in 1975 to $71.940 billion made in 1995. The company’s revenue skyrocketed to the record level of $106.9 billion in 2011, after which it has steadily been declining amidst its transition into new technologies and lines of business. To move with the times and survive the competition from other tech titans, IBM gradually shifted its focus from hardware to software and services. It began to devote more energy and money to cloud-based services and cognitive computing. IBM focuses now on offering primarily network services, application services, cloud services, digital workplace services, business processes and operations, technology consulting services, and AI services. IBM Watson, a cognitive system capable of answering questions posed in natural language, has become the company’s high-visibility offering in the technology field. IBM has a strong faith in Watson, promoting the system as a benevolent digital assistant that would help hospitals, offices, factories, and farms. The company’s white paper referred to Watson as “the future of knowing.”
To see how well IBM has prepared for, what it calls, the new age of understanding, study the statistical data presented below.
Sources: IBM, Wikipedia
Once an unparalleled tech giant, IBM has been struggling for the last decade. It had to adjust to the changing world by selling its low-margin businesses and investing in high-margin ones. To implement its strategies, Big Blue sold IBM WebSphere Commerce to HCL Technologies in 2018 and a part of the Watson Health business at the beginning of this year. Although IBM’s earnings are still high, they do not reach the levels hit between 2006 and 2012. The company’s annual revenue skyrocketed to $106.9 billion in 2011, whereas it was only $57 billion last year. In the second quarter of 2022, IBM’s earnings dropped below expectations. IBM’s falling fortune is reflected in the table below:
IBM’s Annual Revenue since 2000 (in $US Billion)
|Year||Annual Revenue (in $US Billion)|
|2022 (Q1; Q2)||$14.2 billion; $15.5 billion|
Source: Statista; IBM
Big Blue has repeatedly changed the segment reporting to reflect its move away from being hardware, software, and service company towards becoming a cognitive solutions and cloud platform company. It changed its segment reporting in 2016, 2019, and 2021. The last change was dictated by IBM’s need to align its segment reporting with its platform-centric approach to hybrid cloud and AI. There are presently six segments in IBM’s business: Technology Services and Cloud Platforms, Infrastructure, Software, Consulting, Financing, and Other. In 2021, IBM’s software segment generated $24.14 billion of its global revenue of $57.35 billion. In 2022 so far, the Software division earned $5.77 billion and $6.2 billion, in the first and second quarters, respectively. The Consulting sector brought the company $4.83 billion in Q1 and $4.8 billion in Q2 of the current year. The revenue earned by the Infrastructure segment amounted to $3.22 billion in the first quarter and $4.0 billion in the second quarter. Revenues generated by IBM’s segments in the last two years are shown in the table below:
IBM’s Annual Revenue by Segment for 2020-2021 (in $US billion)
|Technology Services and Cloud||$25.00||$28.00|
In the second quarter of 2022, IBM’s Cloud Infrastructure had only a 4% share of the worldwide market, lagging behind Amazon, Azure, and Google Cloud. The spending on global cloud infrastructure services soared to $55 billion and thus brought the industry’s total for the twelve months to more than $203.5 billion. Outshining IBM, Amazon and Microsoft together accounted for more than half of cloud infrastructure revenues in the three months that ended on June 30.
These figures show how much Big Blue fell from grace because, in the past, it used to enjoy the leading position. In 2017, IBM reported cloud revenue growth of 33% year-over-year in its first quarter earnings. In that quarter, its cloud revenue jumped to $3.5 billion. IBM’s total cloud revenue over the past 12 months that year hit $41.6 billion and catapulted IBM to the top of the list in the field of enterprise cloud. In the first quarter of 2017, today’s winners were obliged only to trail behind with lower earnings: Microsoft with $14 billion, Amazon with $12.20 billion, and Google with $10 billion. The latest market share of the main providers of cloud infrastructure can be seen in the table below:
Worldwide Market Share of Cloud Infrastructure Providers in Q2 2022
Sources: Statista, IBM
Net income is defined as a company’s net profit or loss after it has accounted for all its revenues, income items, and expenses. IBM’s net income for the quarter ending on June 30, 2022, was $1.292 billion, which constituted a 5.06% jump year-over-year. The company’s net profit for the 12 months ending on June 30, 2022, was $5.588 billion, demonstrating an increase of 4.76% year-over-year. Last year, IBM’s annual net income reached $5.743 billion, a 2.74% surge from 2020. The first year of the pandemic brought IBM a net income of $5.59 billion, which was a whopping 40.73% drop from 2019. In 2019, IBM’s annual net profit was $9.431 billion, an 8.05% advance from 2018. The uneven trajectory of IBM’s annual net income is drawn in the table below:
IBM’s Annual Net Income since 2009 (in $US Billion)
|Year||Net Income in $US Billion|
IBM is the fifth largest employer in the United States. In 2021, the company employed 282,000 people worldwide. This year, the number of people working for Big Blue dipped to 245,000. As the company has lately been struggling, experiencing drops in its revenues, it is trying to restructure its business and be on par with such tech giants as Amazon, Microsoft, Google, and Apple. Hence the decline in the number of its employees this year. The table below shows how the number of IBM’s employees has changed over the years:
IBM’s Number of Employees Worldwide from 2000 to 2022 (in 1,000s)
|Year||Number of Employees (in 1,000s)|
As the world is facing a probable recession, analysts believe that the enterprise tech sector will still continue going strong. People who are tech-savvy will turn to IBM in these unpleasant times to help them survive in a tighter economic environment and use the company’s software, consulting, and infrastructure to work productively during an economic decline. Big Blue can definitely provide the products and services people will need in the near future. IBM’s Q2 2022 results signify that technology spending in such spheres as AI, cloud, automation and networking is steady. The company beat anticipated results in the second quarter and boasted its first double-digit quarterly revenue growth in more than a decade. Automatic calculations conducted at Coinpriceforecast.com inspire faith in the company’s future and the cost of its stock. At the beginning of the year, IBM’s stock price was $116.92. At the time of writing, IBM is trading at $118.81, thus demonstrating a 2% jump from January 2022. Coinpriceforecast.com foresees that by Christmas, IBM will surge to $138. In the first half of 2023, the price of the stock might advance to $145 and end the next year at $155, adding 30% to today’s price. Whether or not these predictions prove to be correct, IBM will surely continue pushing technology and innovation forward, as it has spectacularly done since the beginning of the twentieth century.
Investors this year increasingly turned away from dividend stocks in favor of the rising yields being offered on bonds. Given that investors can now earn a 4.3% return on a 2-year Treasury note, many prefer that guaranteed return to the risks of putting money into the stock market.
International Business Machines (IBM 1.23%) offers a dividend yield that exceeds that bond return. But with a bear market in progress, are investors better served to take a chance on the cloud stock or to take the 4.3% return at virtually zero risk?
IBM didn't participate in the bull market of the 2010s. The stock dropped as its tech businesses suffered a considerable growth slowdown. In an effort to change that, IBM pivoted into the cloud computing sector aggressively, in part via its $34 billion purchase of Red Hat in 2019. Grand View Research forecasts a compound annual growth rate of 16% through 2030 for the cloud industry. Growth like that could certainly help both IBM and its stock.
Also, IBM spun off its managed infrastructure business into a new public company, Kyndryl. This business was less of a fit with the parent company amid its pivot to the cloud. Separating it off should make it easier for IBM to grow its revenue.
Time will tell if these moves can help the stock price recover. Nonetheless, IBM currently pays its shareholders $1.65 per share every quarter, or $6.60 per share annually. At the current stock price, that adds up to a yield of 5.6% per year. Moreover, depending on your financial situation, the IRS may tax your dividends at a lower capital gains rate, which can offer an added advantage.
Additionally, IBM hiked its payout annually for 27 consecutive years, making it a Dividend Aristocrat. That status carries some importance as many income investors will be more inclined to buy and hold IBM stock because of this status. Also, since abandoning Dividend Aristocrat status tends to hurt a stock, management will probably prioritize maintaining it by continuing to raise those payouts.
Investors also can also reinvest their dividend payments into more IBM stock. However, such newly purchased shares will pay you the dividend yield at that time. The return will rise if the stock falls since investors can buy the exact cash return at a lower price. Conversely, cash yields will drop if the stock rises, but those investors still benefit since the stock has increased in value.
U.S. Treasury notes offer more stability than stocks such as IBM. Investors who purchase the 2-year Treasury note receive semiannual interest payments. At the current interest rate of 4.3%, investors will receive a 2.15% cash return on their invested amount in each of the subsequent three six-month periods. In the fourth period, when the note matures, investors receive the final 2.15% payment along with the return of their principal.
Investors should also be aware that bond values can fluctuate. If interest rates drop, the value of the bond will fall; the opposite will happen if rates rise. This affects investors if they decide to sell the bond early. Upon maturity, the note will return to its par (or nominal) value.
Additionally, bond interest payments are subject to federal income tax but exempt from state and local taxes. In some cases, this is higher than taxes on dividends. Still, bond issuers are obligated to make such payments. In contrast, IBM faces no legal obligation to continue its dividend.
Also, like with a stock, investors can reinvest their interest payments into more notes or other forms of Treasury bonds. However, those purchases will be subject to the prevailing interest rates at that time.
Investors who lack much risk tolerance should choose the Treasury note. Given its guaranteed return, they will not have to worry about volatility.
Nonetheless, for investors comfortable with buying stocks, IBM is a surprisingly strong buy. The cloud industry is in growth mode, which should propel IBM stock to a long-awaited turnaround. Moreover, IBM has repeatedly shown it wants to hold on to its Dividend Aristocrat status. This should supply its income investors returns that are not only larger than the bonds offer, but also likely to increase in size.
New Jersey, United States, Oct. 11, 2022 /DigitalJournal/ System infrastructure software is a type of business software or program designed to increase the computing performance of any organization. It provides various business solutions such as workforce support, business transactions, and internal services and processes. This growth can be attributed to the increasing use of digital tools, systems, hardware, and software, increasing cybersecurity threats, improved data governance to prevent data loss, and the growing demand for hybrid computing. System infrastructure software helps organizations automate their business operations by integrating advanced digital tools, supporting their industry growth.
The System Infrastructure Software Market research report provides all the information related to the industry. It gives the markets outlook by giving authentic data to its client which helps to make essential decisions. It gives an overview of the market, including its definition, applications and developments, and manufacturing technology. This System Infrastructure Software market research report tracks all the accurate developments and innovations in the market. It gives the data regarding the obstacles while establishing the business and guides to overcome the upcoming challenges and obstacles.
Get the PDF trial Copy (Including FULL TOC, Graphs, and Tables) of this report @:
This System Infrastructure Software research report throws light on the major market players thriving in the market; it tracks their business strategies, financial status, and upcoming products.
Some of the Top companies Influencing this Market include:EMC Corporation, IBM Corporation, Symantec Corporation, Apple Inc., Microsoft Corporation, BMC Software Inc., Broadcom, Dell Inc., Hewlett Packard Co,
Firstly, this System Infrastructure Software research report introduces the market by providing an overview that includes definitions, applications, product launches, developments, challenges, and regions. The market is forecasted to reveal strong development by driven consumption in various markets. An analysis of the current market designs and other basic characteristics is provided in the System Infrastructure Software report.
The region-wise coverage of the market is mentioned in the report, mainly focusing on the regions:
Segmentation Analysis of the market
The market is segmented based on the type, product, end users, raw materials, etc. the segmentation helps to deliver a precise explanation of the market
Market Segmentation: By Type
System & Network Management Software, Security Software, Storage Software, System Software,
Market Segmentation: By Application
Building Management System, Cloud Integration, Data Center Infrastructure Management, Integrated Communication, Network Integration, Others,
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An assessment of the market attractiveness about the competition that new players and products are likely to present to older ones has been provided in the publication. The research report also mentions the innovations, new developments, marketing strategies, branding techniques, and products of the key participants in the global System Infrastructure Software market. To present a clear vision of the market the competitive landscape has been thoroughly analyzed utilizing the value chain analysis. The opportunities and threats present in the future for the key market players have also been emphasized in the publication.
This report aims to provide:
Table of Contents
Global System Infrastructure Software Market Research Report 2022 – 2029
Chapter 1 System Infrastructure Software Market Overview
Chapter 2 Global Economic Impact on Industry
Chapter 3 Global Market Competition by Manufacturers
Chapter 4 Global Production, Revenue (Value) by Region
Chapter 5 Global Supply (Production), Consumption, Export, Import by Regions
Chapter 6 Global Production, Revenue (Value), Price Trend by Type
Chapter 7 Global Market Analysis by Application
Chapter 8 Manufacturing Cost Analysis
Chapter 9 Industrial Chain, Sourcing Strategy and Downstream Buyers
Chapter 10 Marketing Strategy Analysis, Distributors/Traders
Chapter 11 Market Effect Factors Analysis
Chapter 12 Global System Infrastructure Software Market Forecast
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ARMONK, N.Y., Oct. 5, 2022 — IBM has announced it will add Red Hat storage product roadmaps and Red Hat associate teams to the IBM Storage business unit, bringing consistent application and data storage across on-premises infrastructure and cloud.
With the move, IBM will integrate the storage technologies from Red Hat OpenShift Data Foundation (ODF) as the foundation for IBM Spectrum Fusion. This combines IBM and Red Hat’s container storage technologies for data services and helps accelerate IBM’s capabilities in the burgeoning Kubernetes platform market.
In addition, IBM intends to offer new Ceph solutions delivering a unified and software defined storage platform that bridges the architectural divide between the data center and cloud providers. This further advances IBM’s leadership in the software defined storage and Kubernetes platform markets.
According to Gartner, by 2025, 60% of infrastructure and operations (I&O) leaders will implement at least one of the hybrid cloud storage architectures, which is a significant increase from 20% in 2022.1 IBM’s software defined storage strategy is to take a “born in the cloud, for the cloud” approach—unlocking bi-directional application and data mobility based on a shared, secure, and cloud-scale software defined storage foundation.
“Red Hat and IBM have been working closely for many years, and today’s announcement enhances our partnership and streamlines our portfolios,” said Denis Kennelly, general manager of IBM Storage, IBM Systems. “By bringing together the teams and integrating our products under one roof, we are accelerating the IBM’s hybrid cloud storage strategy while maintaining commitments to Red Hat customers and the open-source community.”
“Red Hat and IBM have a shared belief in the mission of hybrid cloud-native storage and its potential to help customers transform their applications and data,” said Joe Fernandes, vice president of hybrid platforms, Red Hat. “With IBM Storage taking stewardship of Red Hat Ceph Storage and OpenShift Data Foundation, IBM will help accelerate open-source storage innovation and expand the market opportunity beyond what each of us could deliver on our own. We believe this is a clear win for customers who can gain a more comprehensive platform with new hybrid cloud-native storage capabilities.”
As customers formulate their hybrid cloud strategies, critical to success is the emphasis and importance of infrastructure consistency, application agility, IT management and flexible consumption consistency as deciding factors to bridge across on-premises and cloud deployments.
With these changes to the IBM portfolio, clients will have access to a consistent set of storage services while preserving data resilience, security, and governance across bare metal, virtualized and containerized environments. Some of the many benefits of the software defined portfolio available from IBM will include:
“IBM and Red Hat speaking with one voice on storage is delivering the synergies derived from IBM’s Red Hat acquisition,” said Ashish Nadkarni, group vice president and general manager, Infrastructure Systems at IDC. “The combining of the two storage teams is a win for IT organizations as it brings together the best that both offer: An industry-leading storage systems portfolio meets an industry-leading software-defined data services offering. This initiative enables IBM and Red Hat to streamline their family of offerings, passing the benefits to their customers. It also helps accelerate innovation in storage to solve the data challenges for hybrid cloud, all while maintaining their commitment to open source.”
Preserving Commitment to Red Hat Clients and the Community
Under the agreement between IBM and Red Hat, IBM will assume Premier Sponsorship of the Ceph Foundation, whose members collaborate to drive innovation, development, marketing, and community events for the Ceph open-source project. IBM Ceph and Red Hat OpenShift Data Foundation will remain 100% open source and will continue to follow an upstream-first model, reinforcing IBM’s commitment to these vital communities. Participation by the Ceph leadership team and other aspects of the open-source project is a key IBM priority to maintain and nurture ongoing Red Hat innovation.
Red Hat and IBM intend to complete the transition by January 1, 2023, which will involve the transfer of storage roadmaps and Red Hat associates to the IBM Storage business unit. Following this date, Red Hat OpenShift Platform Plus will continue to include OpenShift Data Foundation, sold by Red Hat and its partners. Additionally, Red Hat OpenStack customers will still be able to buy Red Hat Ceph Storage from Red Hat and its partners. Red Hat OpenShift and Red Hat OpenStack customers with existing subscriptions will be able to maintain and grow their storage footprints as needed, with no change in their Red Hat relationship.
Forthcoming IBM Ceph and IBM Spectrum Fusion storage solutions based on Ceph are expected to ship beginning in the first half of 2023.
Read more about today’s news in this blog from Denis Kennelly, general manager of IBM Storage, IBM Systems: “IBM + Red Hat: Doubling Down on Hybrid Cloud Storage“.
Statements regarding IBM’s future direction and intent are subject to change or withdrawal without notice and represent goals and objectives only. Red Hat, Ceph, Gluster and OpenShift are trademarks or registered trademarks of Red Hat, Inc. or its subsidiaries in the U.S. and other countries.
IBM is a leading global hybrid cloud and AI, and business services provider, helping clients in more than 175 countries capitalize on insights from their data, streamline business processes, reduce costs and gain the competitive edge in their industries. Nearly 3,800 government and corporate entities in critical infrastructure areas such as financial services, telecommunications and healthcare rely on IBM’s hybrid cloud platform and Red Hat OpenShift to affect their digital transformations quickly, efficiently, and securely. IBM’s breakthrough innovations in AI, quantum computing, industry-specific cloud solutions and business services deliver open and flexible options to our clients. All of this is backed by IBM’s legendary commitment to trust, transparency, responsibility, inclusivity, and service.