IBM Software: Cutbacks Will Not Affect Channel Operations
An IBM spokesperson Friday reiterated that the cutbacks were focused on eliminating redundancies and increasing efficiency in the software group. The positions were primarily in marketing and administration, said the spokesperson.
The sites affected are Austin,Texas, home of WebSphere and Tivoli development; Raleigh, N.C., which also does WebSphere marketing and development; software group headquarters in Somers, N.Y.; and Cupertino, Calif., which includes IBM's Rational Software development and marketing.
The cuts amount to 1 percent of IBM's total software population of 38,000, the spokesperson said. Affected employees were notified Wednesday, and will have a month to find other positions within the company, the spokesperson said.
Steve Israel, executive vice president at AMC Corp., a New York-based solution provider, said he doesn't expect to see any falloff in IBM's channel support as a result of the cutbacks. "We are doing very well with IBM software," he said. "We are getting great support from the company. The IBM direct software sales force is partnering closely with our sales force."
Israel said he has over $1 million in sales in the pipeline of IBM's Tivoli Storage Manager and security software. Furthermore, AMC has closed over $300,000 in IBM software sales in the last quarter, he said.
Revenue from IBM's Software group was down 2 percent in constant currency in the most recent quarter. Middleware brands, including WebSphere and DB2, were down 1 percent in constant currency.
The subject of revenue for IBM Software remains somewhat mysterious. The company in the past has trumpted huge revenue growth for its DB2 database line, for example, but never provides the actual numbers. That makes for a sore subject for database competitor Oracle.
In an interview with CRN this week, Larry Bowden, vice president of Portal and Lotus Products for IBM Software Group, said IBM is precluded from breaking out its software numbers by its lawyers who cite SEC regulations. "Believe me, I'd love to tell you the revenue on portals, but our attorneys say no."