International Business Machines Corp. (IBM) has unveiled a new and improved services portfolio to provide advanced and innovative technological services and solutions for its clients.
IBM’s advanced outsourcing services has been developed keeping in mind the client-specific needs and demands that are constantly shifting toward a more IT-driven business initiatives.
IBM has made significant advancements in its services portfolio in the form of pre-configured servers, storage service desks and networking assets. With these pre-engineered services, IBM expects a 60% reduction in implementation time, thereby facilitating a speedy return on investment and saving up to 50% of management cost.
IBM’s services include virtualization of servers used by clients beyond the usual 20% of light workloads that are normally virtualized such as print, file and Web Servers. IBM attempts to simplify the storage by providing a single set of comprehensive tools supporting more than 150 devices of different kinds from various vendors.
A round-the-clock global support service has been set up by IBM in a bid to modernize its service helpdesk. The global support service will be available in more than 50 languages. Along with these services, IBM intends to create a cohesive communication network for global businesses aiding data analysis by using an analytics-based client portal to stimulate superior business judgments.
IBM has the experience and expertise in managing IT environments of innumerable clients globally and will continue to innovate and revolutionize the client servicing space. IBM’s opportunity pipeline with respect new technologies, especially those related to cloud computing continues to grow as clients increasingly go for IT-enabled expansion.
Cloud computing has a number of advantages and the cost advantage of sharing resources has resulted in its growing adoption by businesses across a number of industries. However, proper management and usage of the technology is a prerequisite.
The cloud computing market is expected to grow at a CAGR of 40.0% from 2010 to 2015, crossing $7.0 billion in revenues by 2015. Cloud computing leads to improved services and elevated security requirements for companies that use it and IBM’s product portfolio is well positioned to benefit.
IBM remains a heavyweight in the cloud computing market and its strong cash balance enables IBM to acquire companies with high intellectual property (IP), which will drive further growth in upcoming quarters. We have a long-term Neutral recommendation on IBM and are optimistic about its strong fundamentals and robust growth prospects going forward.
However, the competitive landscape includes technology giants, such as Oracle Corp. (ORCL), Hewlett Packard Co. (HPQ), Microsoft Corp (MSFT) and EMC Corp (EMC), all of which have joined IBM in the cloud computing market.
We currently have a Zacks #3 Rank for IBM, which translates into a short-term Hold rating.
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