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5 Big Things To Know About IBM’s Spin-Off: A ‘Landmark Day’

The main reason for the breakup is to field two independent entities squarely focused on two unique and massive market opportunities. That’s an approach IBM expects to put both companies on a faster growth trajectory.

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The   IBM-NewCo   Partnership 

IBM and NewCo will be entirely separate, with their own operating and financial models, but they’ll “continue to share a strong bond through strategic partnerships,” Krishna said.

“At first glance, it looks like we will be either each other’s largest customers or very close to that,” Krishna said.

But the separation will also result in “greater freedom to partner with other providers,” he told investors.

The guiding principle is to make the IBM-NewCo partnership one that’s beneficial to both companies rather than forcing customers into specific technology constructs and contracts.

At the same time, IBM will continue building out its ecosystem of business partners, including other leading systems integrators that will compete with NewCo.

The combination of ISVs and systems integrators “provide the fuel to the platform” that will be central to IBM’s business going forward.

 
 
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