The deal, struck in January, remains in limbo as the U.S. government investigates security issues around IBM's x86 servers, which are used in the nation's communications networks and in data centers that support the Pentagon's computer networks, say people familiar with the matter.
U.S. security officials and members of the Committee on Foreign Investment in the U.S.—a panel that screens deals with possible national-security implications—are worried the servers could be accessed remotely by Chinese spies or hackers or compromised through maintenance, said people familiar with the matter. ...
Despite the concerns, the deal is likely to get approved, the people said. IBM and Lenovo are mainly trying to address CFIUS concerns about maintenance of the servers, the people said. The companies have said IBM will continue to provide maintenance on Lenovo's behalf "for an extended period" after the sale.
CFIUS, however, is worried that if IBM's service contract for the servers lapses, the maintenance might fall to Lenovo, which they fear could leave the machines more vulnerable to being compromised by Chinese agents. Maintenance could range from remotely updating software to the physical upkeep of the hardware by a technician. ...
After IBM sold its PC business to Lenovo in 2005, the U.S. Air Force received a shipment of Lenovo laptops but promptly returned them, said a former senior military cyber official with direct knowledge of the incident. During a test, officials discovered the machines were connecting to China, the official said. The purpose of the connection was unclear, but it concerned officials because it was unauthorized, the former official said. ...
IBM x86 servers are widely used by the U.S. Air Force and in large data centers run by the Defense Information Systems Agency, which provides the computing and communications networks that support the military, said the former senior military cyber official.
The servers also are embedded in the communications networks of U.S. phone carriers such as AT&T Inc. and Verizon Communications Inc., said people familiar with the matter.
"The latest Power 8 processors have four times more threads and twice the memory bandwidth of the desktop-derived processors [from Intel]. That gives us an advantage for the new workloads coming," says Arvind Krishna, general manager for the development and manufacturing unit in the IBM Systems and Technology Group.
"To get those advantages we have to design our own microprocessors... and to build those processors we have to advance the state of process technology in areas like lithography and [circuit] characteristics."
Unfortunately, Power system sales are in a significant decline. After reaching a plateau in about 2005 of $7.5 billion, sales started to slide and last year dropped more than 30% to $3.9 billion.
In its 2013 annual report IBM said it "recognizes that the size of the Power platform will not return to prior revenue levels. The company will take action by right-sizing the business for the demand characteristics it expects." ...
Neither Burlington nor East Fishkill could be economically upgraded, says G. Dan Hutcheson, chief executive of VLSI Research. Next-generation lithography machines will require special floors and taller rooms, he tells us.
Nevertheless, several observers believe IBM could sell both fabs to foundries and continue to have its own chips made there. IBM could even continue to develop process technology at its T.J. Watson research center to differentiate future chip designs, transferring the processes to partner foundries. ...
Arvind Krishna said he takes morale issues seriously, but he considers problems at IBM are in line with the rest of the industry.
"As a leader for a very large engineering team, I am paranoid on morale... I am paranoid about opportunities that exist for our people; they tend to get hired away," says Kirshna, whose group includes 23,000 engineers and programmers.
Selected reader comments follow:
"He said everyone was taking his people and he was sorry he could not keep them, so some of this is universal in the industry. People have a lot more options these days, and it's more acceptable to move around."
You are joking, right? You kicked them out, they are not going and joining with some other company on their own. You forcefully sent them out and called it as Resource Action and you and your managers gave a sweet name to it as Operation Apollo. That is your fault. Don't put the blame on others. People who were laid off have already moved on and started earning for their families, they will not/can not keep chanting your company name forever.
Don't tell me that junk excuse everyone in this industry is seeing loss so do I am. I will give you a PBC rating of 3 for that cheap excuse. If P8 saves you and your business that itself is a big miracle.
Look who is talking- this company has lost the right to talk about ethics. Don't tell me that old joke- IBUmme
Intel is doing the bulk of its 14nm wafers at D1D Fab that is older than East Fishkill.
Moreover East Fishkill Fab is fully equipped of immersion 193um steppers to manufacture the 22nm Power 8 SKUs. Strange enough these steppers are good even for 14nm and 10 nm nodes with multiple patterning.
The real story is that IBM wants to exit from manufacturing as fast as it can, no matter how many people will lose their jobs and no matter the disruptive effect on Common Platform alliance.
"The job market for chip designers in Austin over the last two years has been amazing, with Apple, ARM and Qualcomm all recruiting very aggressively and successfully from IBM and other struggling chipmakers like AMD and Freescale. The IBM server development group in Austin has lost a huge amount of intellectual capital, as the best and brightest were drawn away to higher salaries and more promising opportunities. Design teams in Raleigh and Rochester have also suffered big losses.
I was one of the ones voting with my feet and leaving IBM last year."
"It's a shame to see them talk about divesting -- it's a national resource," says Gary Bronner, an IBM veteran now at Rambus. "A lot of industry innovations were led by IBM."
"Given their history, it would be a sad day if they really got out of semiconductors," says G. Dan Hutcheson, chief executive of VLSI Research. ...
"IBM began producing discrete transistors in the mid-1950s for its products," says Rob Lineback, a senior analyst at IC Insights. "By 1959, the company had developed an automated transistor production process, allowing transistors to replace vacuum tubes in its mainframe computers."
In 1978, IBM was one of the world's leading memory makers, from a technology perspective.
"They were making 64 kbit DRAMs -- a full node ahead of everyone else -- and moving to 256 kbit parts while the rest of the industry struggled to get there and didn't make it until about 1981," says Hutcheson. ...
IBM's focus on servers for businesses prevented it from seeing and responding to what one former employee calls "the biggest server buying spree in a decade." ...
IBM's focus on services created a product mismatch, says Nathan Brookwood, principal of market watcher Insight64.
"The mega-datacenter guys don't need and won't pay for services; they want lots of dense, low-cost servers. But IBM wants to sell beefier, pricier servers," Brookwood says. ...
The former IBMer also criticizes the company for not doing enough to create software communities around its Cell and BlueGene processor architectures. He points to a lost supercomputer deal in Illinois as a sign of Intel's increasing dominance in that sector. ...
"They almost tried too hard to be a leader, an anti-Intel. Now I think the path for IBM is to take their smart people and R&D and work hand-in-glove with the GlobalFoundries people."
At Mount Rainier Elementary School, Aaron Lavallee, 34, of Mount Rainier said he supported Tarlau because of his “solutions-oriented” approach to governing.
“He played a leadership role on [the Mount Rainier City] Council,” Lavallee said of Tarlau. “I think that will be important for us in the Maryland legislature.”
Editor's note: Congratulations to Jimmy Tarlau, a labor organizer who was instrumental in forming the Alliance@IBM and who played an active role in protests at several IBM shareholder meetings. We appreciate your service, Jimmy, and hope for your victory in the Maryland District 47 primary election.
I am sooooo happy I don't have to work for a politically correct, faked diversity, minority ruled and outsourced products and services corporation that flushed the IBM 3 basic beliefs down the drain in favor of the almighty dollar. The IBM I worked for was the best of breed. The best products, the best people, the best management, etc. The work was hard, fun and full of challenge. We were a REAL team and we knew how to make things happen while still enjoying the freedom to pursue individual excellence.
I left a job I really liked, working with system i business partners as a technical resource, but am glad I did because there have since been another two big layoffs in the area I worked, I am am pretty sure I would have been caught up in one of them. I sincerely believe that for every IBMer, that in terms of layoffs, it is not a matter of if, it is a matter of when regardless of your talent, skills, or dedication.
Numerous cardiologists have told me that having a stroke increases the possibility of having a second fatal stroke. Luckily I had heart surgery to reduce the possibility of a second stroke. Was IBM negligent in not providing me with this health information? I am currently investigating the medical details. Once an IBMer, I would never go after IBM. But would go after their medical insurer (Manulife Canada).
My experience at IBM was no different. I had managers, both male and female, that were positively outstanding, and others that were at the opposite end of the spectrum, to put it mildly.
Unfortunately, over the past several years, I've seen the company change from one where employees were a valuable member of the overall company team and were treated as such, to one where EPS is the overriding consideration and employees are commodities to be used and dispensed with if quarterly targets are not met.
Bottom line, I've experienced the best and the worst that IBM has to offer. However, I consider myself extremely lucky - I was able to retire on my own terms, when I wanted to, with enough resources to have a comfortable retirement. I retired because I was ready - ready to devote my time and energy to activities where I have established the priorities. I want to wish all of you out there, still working or retired, the best of luck, health, and prosperity in all your current and future endeavors.
I was a second generation IBMer and expected I would spend my whole career there just like my father, but it just became an intolerable place to work. Sad.
This may be a regional phenomena within IBM India but I feel that the implementation of the PBC system is unrealistic, sometimes exerting so much pressure on managers that they tend to drift off into wrong doing and arm twisting their reportees depending on how much influence they exercise (or don't) among their peers and higher-ups. So, individuals stuck with an incompetent manager are generally done for.
I still value my IBM experience (especially the work with IBM Hursley labs) as the most valuable part of my career and probably would have stayed on had the work environment not become this intolerable in my last team, and the pay impractical to live with.
I work for another company today , with a better pay , good work environment and better work life balance.
Alliance Reply: The lawsuit was originally setup on behalf of those that came forward from the Village of Endicott residents. It was not focused on the IBM employees. Some of the plaintiffs however, were former IBM employees AND they were also residents of the Village of Endicott. Alliance@IBM representatives made efforts to bring the NYS Dept of Health and the National Institute of Occupational Safety and Health in, to study the effects on 35,000 IBM Endicott employees health records and IBM's industrial hygiene records. Those results were published and made public in January of 2014. If you were an employee of IBM Endicott between the years 1969 and 2002, then you were included in that study.
I really am looking for an exit from this. It's a comfortable workplace but I joined the industry to be at the forefront of innovation and not to endlessly fix stupid bugs caused by half competent coders. By the way, does IBM management spy on SameTIme messages? -depressed-
All external traffic goes through a transparent proxy. All internal site access that requires IIP credentials can be summarized. There is no group that spends their time looking 24x7, but in big data terms the information is there. -Ex IBM CIO Org Drone-
This site is designed to allow IBM Employees to communicate and share methods of protecting their rights through the establishment of an IBM Employees Labor Union. Section 8(a)(1) of the National Labor Relations Act states it is a violation for Employers to spy on union gatherings, or pretend to spy. For the purpose of the National Labor Relations Act, notice is given that this site and all of its content, messages, communications, or other content is considered to be a union gathering.