IBM to cut about 3,900 workers while still hiring in ‘higher growth’ areas
latimes.com
latimes.com
They have 260k employees, for what?
But yeah, they do seem to be running on inertia. I've never heard of anyone buying anything IBM for new work.
They are a major systems integrator in the financial and govt world, they have a massive professional services team ensuring everything from AIX to RHEL7.2 is running and not breaking for customers, they have very smart HPC and Quantum Chemistry people working on building Quatumn Computing algorithms, they are building features in IBM Cloud for our EU banking counterparts (too big to fail French banks seem to have converged on IBM cloud as their platform of choice), managing a major Docker Hub competitor (Quay), building out and managing the primary on-prem Kubernetes orchestrator (OpenShift), and are managing the primary incident response platform used by enterprises.
There are a lot of issues and gripes to have about IBM, but they are a very critical player in the industry. Tech Bros on HN just don't have the visibility and remain in their weird HN echo chamber.
And IBM 100% does still have a middle management problem - no way I'd ever work there unless I was at least a VP.
As someone who has worked in consulting on the Enterprise side for 25 years, the HN attitudes towards IBM, SAP, Oracle, and even SaaS companies like SF/SNOW/Adobe is baffling. Corporate America would literally cease to function if these companies disappeared one night, but would hardly bat an eye over the disappearance of Facebook, Apple, or even Google.
This is likely to become less extreme over time as our experiment with low to negative interest rate policy comes to a close.
HN has devolved into burned out Gen X or elder Millenial FAANG engineers bitching about their gilded cage existence.
Mainframes: $4.5 billion
Consulting: $4.8 billion (even after selling off Kyndral)
Software: $7.3 billion
Software includes all of Red Hat, a pretty big security business, and "transaction processing" which isn't explained but I guess is running payroll and the like for other companies.
So lots of un-sexy stuff that never makes HN but keeps the world running.
IBM is a dinosaur company that exists because of embedded connections in government, banking, and defense. They charge 100x the going rate for ancient tech that’s insecure and an absolute nightmare to develop for.
The sooner everyone drops anything associated with IBM or Oracle, the better for everyone. Absolute cancers.
If the only alternative is "AWS, Docker, Kubernetes, Terraform, Spark, Aurora, etc…" I might have to think long and hard about it...
- No devops, you have real sysadmins whose priority is security and system administration, not development.
- Not relearning to invent the wheel every six months. The technology changes incrementally. If you get out of the field for a few years, read the "what's new" sections of the new manuals to catch up.
- Documentation. IBM docs are great, remind me of NASA docs. They have everything you need, you can go days without googling a problem.
- Backwards compatibility. Decades old sources can be compiled, decades old binaries can be run. Architecture changes are handled transparently.
- Simplicity. The interfaces might seem primitive compared to PC OSs, but there's also less complexity, and less attack surface.
- Uptime. Almost everything, including CPUs, is hot-swappable. This doesn't add to the joy, but it's remarkable.
I think it's things like these which makes me thing AWS will remain the top cloud provider for the next few decades.
Azure policies are comparatively a breeze, making it the smart and increasingly obvious choice for any regulated (read: large) corporation.
Consider some ideas which exist in z/OS but not in Unix or Windows:
- record-oriented file system: the filesystem is aware of the record-boundaries of files, whether they contain fixed length or variable length records, etc – and enforces them
- indexed files: key-value type files are built in to the filesystem, not some add-on library
- the catalog: a database mapping file paths (dataset names) to the volumes they are stored on: so you can move a file to another disk volume (or even to tape) without changing its filesystem path. You can kind of approximate this using mount points, symbolic links, etc – but it is a lot messier
- partitioned data sets (PDS/PDSE): like ZIP/TAR files, but again, built-in to the filesystem
- block-oriented terminals: you send/receive data to terminals as a screenful at a time, not a character at a time
- DDnames: your program inherits (the moral equivalent of) file descriptors, but instead of just having numbers, they have names (instead of fd 0, you have a DD called "SYSIN")
You can argue about whether the above features are sensible – the designers of Unix were well-aware of them, but decided they were examples of unnecessary complexity – but sensible or not, they are interesting.
Something that neither UNIX nor Windows have fully embraced to the extent of mainframes/micros.
All the deployments from Java and .NET workloads end up with some kind of compromise to classical UNIX/Windows development.
I think we've had this discussion before. The Language Environment (LE) on z/OS doesn't do that. The Integrated Language Environment (ILE) on OS/400 [0] does do that. But while one part of ILE (the CEE runtime and its API) is common code between z/OS and OS/400 (and also VM, VSE, TPF and OS/2) – that bit doesn't do any of the "keep oldie programs running by recompilation" stuff. Whereas, the parts of ILE which does do that (the OMI to NMI translator, and the NMI to POWER translator), is 100% OS/400 specific, and has no equivalent on any other IBM platform (z/OS included). You seem to be getting led astray by the fact that "Language Environment" means a lot more in OS/400 than it does in MVS – it is a mistake to assume that just because the later uses the same phrase, that it uses it to mean anywhere near the same thing. LE on MVS is just one (relatively small) part of the capabilities provided by ILE on OS/400.
(Also, this "platform independence" doesn't really have anything to do with anything "Language Environment", since it pre-exists ILE entirely – EPM and OPM before it had the same ability. You are associating "Language Environment" with something which was never actually the selling point of ILE, since it was something OPM and EPM already could do, at least in principle. The real selling point of ILE is that it could support recursive/stack-based HLLs such as C and Pascal more efficiently than EPM, and support mixing code from multiple languages much more easily than OPM and EPM allowed. Plus, a lot of its implementation was shared with z/OS and AIX, which was a bonus for IBM – not just the CEE runtime, but also the compiler backend–the later is not considered part of LE on z/OS, rather part of the compiler products)
[0] Yes, IBM i, I know – but I hate that name, it is confusing. IBM should have just stuck with OS/400, it was far more memorable and distinctive.
This is so interesting, having witnessed the commoditization of PCs, the Cloud, and now virtual desktops on the cloud. We're basically reinventing the multiuser mainframe after discovering it actually had good proposals.
The problem is, it's being reinvented with a monstrous degree of complexity and fragility. It's retaking the road not taken, but carrying the other road with as well.
Most of their cash register controllers can run on x86, so, it's not dependent on their hardware for the backend.
Their cash registers can run the 4690 OS or Windows/Linux/whatever, but, most choose to run the 4690 Operating System due to its security features.
I worked at IBM in their retail marketing side in the early 2000's, so, it's possible that everything I've typed here is 20+ years out of date.
> I worked at IBM in their retail marketing side in the early 2000's, so, it's possible that everything I've typed here is 20+ years out of date.
4690 is pretty close to dead. Maybe not entirely dead, but closer to that status than it has ever been before. From what I understand, even before IBM sold it to Toshiba, the plan already was to discontinue 4690 and replace it with Linux. At the time of the sale, IBM was in the progress of replacing it with "IRES" (IBM Retail Environment for SUSE); Toshiba has instead chosen as the replacement its own Linux distribution, "TCx Sky", which is a customised version of Wind River Linux.
The terminal release of the 4690 OS was V6R5, released 7 years ago. The latest security update was CSD 2010, released in January 2020. There are probably still some people using it even today, but it is very much a legacy system, with zero plans for any further enhancements; it isn't even clear if there will be any further security updates in the future, or if the January 2020 update was the last one. (I guess it may depend on how many people are still using it, what further security bugs might be discovered, how much those people are willing to pay to fix them, etc).
Something like 90%+ of the top 100 banks depend on mainframes and same with the top 100 retailers. Few customers that pay a lot is a solid model.
I think it's more than just a few customers.
Mainframes were always cheaper. The only reason things like Hadoop and MR even picked up for heavy batch jobs, was because in the last decade lots of cheaper consumer hardware was available, due to companies having over invested in building data centers. The excess capacity was sent to hadoop work. If you have continuous ongoing investments in Mainframe tech or wish to start something new, you are better off using Mainframes.
Work doesn't need to be fun.
IBM is a leader in quantum computing. If you find that boring, that's on you.
Where is the excitement of working during the weekend to make sure the dozens of random libraries npm downloaded as dependencies of the one you need to display a neon outline in the list of products are compliant?
Your answer is here: https://www.ibm.com/
(Oh the irony...)
Of course IBM then have massive cost overruns they charge to the government and they repeatedly bungle it all in embarrassing ways. https://www.abc.net.au/news/2016-11-25/ibm-to-pay-over-$30m-...
I think governments haven't yet caught on to the new age mantra
"Everyone gets fired for buying IBM"
https://www.macrotrends.net/stocks/stock-comparison?s=revenu... https://www.statista.com/statistics/269013/deloitte-revenue-...
Skating to where the puck has been. While other companies are taking a look at how much they are spending on cloud. It's already a commodified market yet IBM sees itself as the one to grow into it.
Toyota has made a multi-decade business model around "skating to where the puck has been". Why can't IBM?
And people on the Hill trying to make their mark are concentrating more on the Ad Business and Marketplace portions - those are easier wins for consumers and (more critically) small mom and pop businesses that love to participate in local politics.
https://community.hacc.mil/s/jwcc in case anyone else was also wondering
IBM has failed to build a reasonable cloud platform, and not for lack of trying -- for over a decade at this point -- through both internal work and acquisition. Create a cloud.ibm.com account and poke around.
> Toyota has made a multi-decade business model around "skating to where the puck has been". Why can't IBM?
They can, but I'm not sure what you mean by Toyota... they were early on hybrids in general and are definitely the leader in the plug-in hybrid space... what competes with the RAV4 or Prius plugins if you need ICE car range on the weekends and electric for your short commute?
As for Toyota, hybrids were basically their last big innovation. And their plug-in hybrids are iterations on their regular hybrids, not new ground-up designs. Since the late 90s they've been continually behind the curve by intent. Their engines/transmissions/infotainment/interior design is all at least 5 years behind the competition, as are their EVs. They've taken a stance that refinement is more important than bleeding edge innovation, and a good chunk of the market seems to agree (my family included, we drive two Toyotas). The hydrogen stuff is just noise.
> Krishna’s strategy has been focused on bolstering the company’s offerings in hybrid cloud — providing services to customers that run their own data centers in some combination with public cloud
i.e. making it easier to move between data centers and cloud, and back again, so if "companies are taking a look at how much they are spending on cloud." then sounds like IBM are skating towards where the puck is going.
Hasn't that already been won by like 3 companies?
4000 seems like a tiny number in context of total headcount, and when you take into account that they've somehow lost more than 5 times as many in the past year.
> The cuts will focus on workers remaining after spinoffs of the Kyndryl and Watson Health units
So the already dead parts of the company? It's almost like they're doing layoffs for the sake of appearances; they aren't really changing anything.
It's almost like you're noticing this because the media is playing up layoff reports in tech.
To quote... you - "4000 seems like a tiny number in context of total headcount, and when you take into account that they've somehow lost more than 5 times as many in the past year."
They've reduced staff by 5 times this amount over the last 24 months, but this is the reduction that you think is for the sake of appearances... I wonder if that's because this is the one getting media attention...?
Nearly all the layoff reports I've come across I hear about before they're in the mainstream media. Additionally I predicted months ago that we'd be seeing massive layoffs in tech, before the media was talking about it at all.
These layoffs are real, are atypical for what we've seen the past decade, and are impacting a large number of real devs.
Honestly I haven't even seen the media talking about it until the last few weeks. When I talked about impending tech layoffs back in Oct-Nov nobody outside of the tech community had any idea that there were any issues facing tech.
I hardly see how layoffs are being "played up" rather than just being reported.
So basically - we had a large glut of hiring during covid in tech as demand was high for those products and services (being in lockdown certainly helped) and now we're seeing a relatively minor adjustment back down.
Given the increased interest rates and the slump in demand - I think we're actually still well on the light side of the possible wave of layoffs.
I think the reporting is still in line with the gloom and doom headlines that attract attention. Basically - they're reporting much more on the tech layoffs because it garners views.
The increase in tech hiring was just as hard - and while it did get media attention, it was not nearly as intense and recurrent.
In terms of being a going concern for large customers and investors? The make billions of dollars of profit per year, have a P/E valuation better than Apple's, and pay out 4-5% dividends annually.
I'm not sure what it really means to "be dead" for 40 years. In a sense, the average human is "dead" for 70-something years. But periods of time at that scale are called "life", lol.
IBM will be here long after everyone reading this is gone. They aren't relevant to the environments in which most of us work (they're basically a professional services consulting firm), but we aren't everything.
IBMs stock price was $100 in the 2000s. It's only $133 now. If it adjusted for inflation - that would be $173 today. You lost about 25% in real depreciation to get about ~3% per year yield in dividends (taxed as income $$$).
You can do better with Treasuries.
So why take the risk on Big Blue?
Not uncommon for someone to describe a company like this as "dead" - even if it is, presumably, providing some economic value.
https://www.macrotrends.net/stocks/charts/IBM/ibm/net-income
>The make billions of dollars of profit per year, have a P/E valuation better than Apple's, and pay out 4-5% dividends annually.
For a shareholder, this is little solace when their return compared to the market (a basically risk free rate of return) is negative. 0.64% for the last 10 years, 5.93% for the last 20. SP500 is at 12.4% and 9.8% for the same timeframe, per dqdyj.com total return calculator.
We did better than most about not over-hiring in the first place.
> The cuts will focus on workers remaining after spinoffs of the Kyndryl and Watson Health units and will cost the company about $300 million, he said. IBM still expects to hire in the “higher-growth areas,” Kavanaugh said.
> Chief Executive Arvind Krishna has been trying to pivot Big Blue from its traditional business of infrastructure and information technology services to the fast-growing cloud-computing market.
Can't help but see all the layoffs as part of a "great refocusing", even with positive news for the company, you can use the fact that everyone is doing layoffs to reorient things. If everyone wasn't doing layoffs, people would worry about the company, and the news wouldn't be buried. Layoffs are just the tool companies suddenly have available to do this with (seemingly) no consequences to them