This article was originally
published by Seeking
Alpha on May 19, 2014
IBM is ahead of Cisco (CSCO), Hewlett-Packard (HPQ), AT&T (T) and … read full
article on Seeking
Alpha
By Sarfaraz A. Khan. Research Asst. Gohar Yousuf
IBM continues to show
strong growth in cloud revenues after spending billions on developing its cloud
offerings.
However, the company
has a lot of work to do before this starts having any impact on its top line
growth.
IBM has touted two
major cloud deals, but these might not have any meaningful impact on the growth
of its cloud revenues.
International Business Machines (IBM) has been
readjusting its portfolio by moving away from less-attractive products and
investing on higher-margin operations. So far, the company has sold its storage
disk drive business, personal computer unit and the server business and a
services unit. Meanwhile, the business is eying considerable growth in cloud
computing-related revenues.
Heavy Investments
IBM has spent billions to ramp up its cloud offerings,
including heavy investments for its Watson Group. Since 2007, the company has
spent $7 billion on 17 cloud-related acquisitions. The company currently has a
massive portfolio of more than 1,500 cloud patents. The company's target is to
generate $7 billion in revenues from its cloud offerings by as early as 2017.
Over the years, IBM has become the biggest provider
of services to enterprises in the Infrastructure as a Service (IaaS)
industry, according to research firm IDC.
IDC's results were based on a survey covering more than 400
enterprises, of which 35% named IBM as their top choice in both public and
private clouds.
