Skip to main content

Market Overview

IBM Is Getting Ready To Fight For A Place In The Cloud Universe

IBM Is Getting Ready To Fight For A Place In The Cloud Universe

It all started when International Business Machines Corporation (NYSE: IBM) joined forces with the open-source software giant Red Hat. The deal was closed in July 2019, after IBM acquired Red Hat for $34 billion. This deal, one of IBM's biggest acquisitions ever, aimed to help the company increase its market share in the cloud infrastructure business, which has been stated as one of the company's four key growth segments, besides social, mobile and analytics.

And the target is quite high – to reduce the gap between IBM and cloud industry leaders like, Inc. (NASDAQ: AMZN) and Microsoft Corporation (NASDAQ: MSFT). IBM needed this after three consecutive quarters of declining revenues on a year-over-year basis. 

Changes In IBM After The Red Hat deal

Red Hat became the "unit" of IBM's hybrid cloud division, leading to some changes in the C-Suite. Ginni Rometty, IBM's CEO who led the company since 2012 stepped down, but she will stay in IBM in the role of executive chairman of the Board until the end of 2020 when she plans to retire after spending almost 40 years in the company. For her successor, the company chose Arvind Krishna, who has been with the company since 1990. Krishna's previous position as IBM's senior vice president for cloud and cognitive software is more proof of the company's strategy in the cloud segment. He was the one responsible for IBM's acquisition of Red Hat for $34 billion.

On top of that, Red Hat's CEO Jim Whitehurst, who joined IBM's senior management team to report to CEO Ginni Rometty, before she stepped down, was named IBM's president in late-January. His previous position in Red Hat was filled by Paul Cormier who has been with the company since 2001, and helped it grow to a multi-billion-dollar corporation.

Collaboration With The Banking Sector

After Arvind moved up to IBM's CEO position, he left the position of head of IBM's cloud business open. The company decided to hire Howard Boville for that position, who was chief technology officer at Bank of America Corporation (NYSE: BAC). Boville was leading the team that built and ran the second-largest U.S. bank cloud solution. IBM has previously collaborated with Bank of America on the creation of a financial services-specific cloud solution.

The Cloud Battle Is Just Heating Up

Of course, the competition is not standing still. One of the two cloud market leaders, Microsoft, knows it must constantly work on new solutions and ideas to keep its current position and maybe increase market share. To do so, Microsoft announced its decision to acquire a company Affirmed Networks and its cloud-native, virtualized mobile network solutions. This will enable Microsoft to upgrade its work with the telecommunications industry and build a more secured and trusted cloud platform, which will be a new tailor-made solution for the operators and will help them to better manage their network workloads in the cloud segment.

Between IBM's advancements in its cloud business, Microsoft's continued investment, and the looming threat of Amazon, it's clear that the cloud wars are just heating up. 

This article is not a press release and is contributed by Ivana Popovic who is a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . Ivana Popovic does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: Contributors – IAM Newswire accepts pitches. If you're interested in becoming an IAM journalist contact: Questions about this release can be sent to

The post IBM Is Getting Ready to Fight for a Place in the Cloud Universe appeared first on IAM Newswire.

Photo by Carson Masterson on Unsplash


Related Articles (AMZN + BAC)

View Comments and Join the Discussion!

Posted-In: Amazon Arvind Krishna cloud Ginni Rometty Howard BovilleMarkets Tech General