IBM (International Business Machines) is by far the world’s largest information technology company in terms of revenue ($88 billion in 2000) and by most other measures, a position it has held for about the past 50 years. IBM products include hardware and software for a line of business servers, storage products, custom-designed microchips, and application software. Increasingly, IBM derives revenue from a range of consulting and outsourcing services. With the advent of the low-cost microchip, the personal computer, distributed computing, open rather than proprietary standards, and the Internet, IBM has seen its position of dominance challenged as the world of information technology no longer revolves around a single company. Yet investors and competitors continue to be impressed by IBM’s long-established base of customers among middle-sized and Fortune 100 businesses and its ability to adapt its products and services to a changing marketplace.

Called Big Blue for a reason, the company is among the leaders in almost every market in which it competes. It focuses primarily on its services business, which accounts for nearly 60% of sales. While IBM made its name in computer hardware (think mainframes), the company’s information technology, business services, and software units are now among the largest in the world. While it has moved from hardware to a large degree, the company maintains its industry-leading enterprise server and data storage products lines. IBM is transforming its operations as it deals with a rapidly changing technology environment.


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