IBM To Combine Storage, Server Businesses Into Single Organization

IBM is planning to recombine its storage and service divisions into a single organization nearly three years after splitting the two.

An IBM spokesperson confirmed that the two will be recombined starting Jan. 1. Heading the new combined organization will be William Zeitler, currently senior vice president of IBM's Server Group.

Linda Sanford, who currently heads IBM's Storage Systems Group, was tapped this week to head up IBM's on-demand computing organization, announced Oct. 31, where she will be senior vice president of enterprise on-demand transformation, the spokesperson said.

The on-demand computing business is expected to treat computing resources as if they were a utility, and increase the automation and 24x7 capability of IT infrastructures, said the spokesperson.

When Sanford took over IBM's newly formed Storage Systems Group in January 2000, it looked very much like a startup organization, the spokesperson said. Since then, however, the organization has grown and matured, and now offers a broad storage product portfolio.

As a result, said the spokesperson, IBM has recently surpassed EMC in storage revenue, according to IDC. Also, the spokesperson said, an A.G. Edwards report last week said that IBM's Enterprise Storage Server, code-named Shark, picked up market share from EMC.

Bringing the two organizations together is a good move, said Chris Pyle, president of Champion Solutions Group, a Boca Raton, Fla.-based solution provider and one of IBM's largest business partners.

"I think it gets everybody selling the complete line," said Pyle. "Before, there were some IBM server guys who didn't get compensated for selling storage. That was just changed recently. At Champion, I want my people selling everything."

Pyle said that IBM's initial spin-off of storage as a separate group a couple of years ago was the right move at the time. "They needed to spin off the Storage Systems Group back when EMC was strong," he said. "It has done a great job with the product, and [today] is second to none."

IBM is also strong across its entire server line, and bringing servers and storage together will help customers acquire complete solutions, said Pyle.

The combination will also help make more efficient use of R&D resources, Pyle said. "At the end of the day, isn't the Shark an enterprise storage server?" he said. "Isn't all storage based on servers?"