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«Year Pages 2000 2-9 2001 10-19 2002 19-31 2003 31-39 2004 39-52 2005 52-61 February 2006 1406HHX Business Performance IBM revenue climbs to $85.09 ...»

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IBM, Sony Corporation and Sony Computer Entertainment, Inc. say they have powered-on the first Cell processor-based workstation. Cell is the code name for an advanced microprocessor under development by IBM, Toshiba and Sony Group. The companies expect that a one rack Cell processor-based workstation will reach a performance of 16 teraflops or trillions of floating point calculations per second.

Facilities In May, IBM opens its first Deep Computing Capacity on Demand center in Europe. The new facility, located in Montpellier, France, is the second of its kind in the world, and will provide customers access via the Internet, to immensely powerful, highly secure supercomputers. The Montpelier center joins IBM’s Deep Computing Capacity on Demand center in Poughkeepsie, N.Y., as the only two facilities in the world at the time to offer supercomputing power on tap to companies in industries such as petroleum, life sciences, digital animation and financial services.

Three months later, in response to the petroleum industry’s increasing need for supercomputing power in oil exploration and production, IBM announces plans to open the third IBM Deep Computing Capacity on Demand (DCCOD) center in Houston, Tex. The new DCCOD in Houston will join IBM’s existing centers in Poughkeepsie and Montpellier which enable customers to easily draw on massive supercomputing power to help meet critical short-term business needs, while avoiding large upfront capital outlays and long-term fixed IT costs.

IBM opens an European RFID (radio frequency identification) Testing & Solution Center in La Gaude, France, to allow companies based in Europe to test RFID solutions in real customer environments. The La Gaude facility complements existing IBM development centers in Gaithersburg, Md., and Tokyo, Japan.

The company opens a new SMB Innovation Center in Beijing, China, giving IBM researchers and independent software vendors (ISVs) access to over ten million small and mid-sized business in China. IBM is providing the ISVs with resources to develop open solutions designed to help SMB customers improve their global supply chain. The SMB Innovation Center will be an extension to IBM’s China Research Lab, which will double in size to accommodate the new facility.

IBM establishes the IBM eServer xSeries Taiwan Development Center (xTDC), IBM’s first xSeries development center in Asia Pacific and the first such center opened by IBM outside the United States. The Taiwan xTDC will play a key role in connecting local vendors with IBM’s global resources for Intel-based server development.


Corporate Citizenship At the end of the year, IBM Chairman Samuel J. Palmisano authorizes a preliminary allocation of $1 million to support relief efforts for the victims of the tsunamis that struck southern Asia on December 26. IBM Crisis Response Teams in India, Indonesia, Sri Lanka and Thailand are deployed to assist local governments and relief organizations.

IBM, along with representatives of the world’s leading science, education and philanthropic organizations, launches World Community Grid, a global humanitarian effort that applies the unused computing power of individual and business computers to help address the world’s most difficult health and social problems.

The company announces the next step in its On Demand Community volunteer initiative by enabling its approximately 160,000 retirees to leverage new technology tools to increase the impact and value of volunteer efforts in schools and local agencies across the globe. For retiree volunteers who donate time to community organizations, On Demand Community provides access to innovative new IBM technology that will help clients of senior centers and organizations for the disabled access and see the Internet better. Other tools include curricula for after school community programs, and tools that lead community nonprofits through a step-bystep technology assessment and the creation of a technology plan that will help the organization better serve its clients.

An extraordinary partnership between the Egyptian government and IBM creates “Eternal Egypt,” providing worldwide access to more than 5,000 years of Egyptian history. IBM funded the project through a $2.5 million grant of technology and expertise from its Research and Services teams in the United States and Egypt, and the Egyptian government contributed a team of experts who developed the system’s content. The Eternal Egypt project combines the most important locations, artifacts, people and stories from Egypt’s history into an interactive multimedia experience.

HP, Dell and IBM release an Electronics Industry Code of Conduct to promote industry standards for socially responsible business practices across their global supply chains.

Business Performance IBM revenue reaches $91.134 billion, a decline of five percent compared to 2004, and net income of $7.934 billion is six percent higher than the year before. There are 329,373 employees and 637,133 stockholders at year-end.

Organization IBM announces plans in May to implement a series of restructuring actions designed to improve the company’s efficiencies, strengthen its client-facing operations and capture opportunities in high-growth markets.

The company then realigns its operations and structure in Europe to improve the speed of execution and better meet the needs of its clients. The realignment is aimed at reducing 1406HHX bureaucracy and infrastructure in lower-growth countries and creating teams that can work across country borders, thereby shifting more employees into direct client roles that support the company’s plans to deliver high-value services and products. These steps eliminate the need for a traditional pan-European management layer to coordinate activity.

Effective July 4, IBM replaces the former European management system with two Integrated Operating Teams (IOT) -- Northeast Europe and Southwest Europe -- each comprising four Integrated Market Teams (IMT) focused on specific countries or clusters of countries. Additional shared centers of competence are created to support specific sales-related activities in the IMTs and IOTs.

Also in July, the company changes its leadership team for IBM Global Services, creating three overall organizations, each led by a senior vice president: Information Technology Services, Enterprise Business Solutions, and Integrated Operations.

IBM acquires several businesses during the year, including:

SRD, a privately held company based in Las Vegas, Nev., and a provider of identity resolution software.

Corio, Inc., an enterprise application management provider based in San Carlos, Calif. The company’s application services will be marketed by IBM Global Services.

Equitant, a global business transformation outsourcing provider that focuses on the management and optimization of the Order-to-Cash cycle for large companies.

Ascential Software Corporation, a publicly held company based in Westboro, Mass., and a provider of enterprise data integration software. IBM establishes Ascential Software’s operations as a business unit within IBM’s Information Management Software division and incorporates the company’s technology and solutions into IBM’s Information Management and Software Group offerings.

Healthlink Incorporated, the foremost healthcare process improvement and IT consulting services company in the United States. The Healthlink team becomes the core of the provider transformation practice for the healthcare industry within IBM Business Consulting Services.

Gluecode Software, a privately held company based in El Segundo, Calif., and a provider of software and support services for open source application infrastructure software.

Isogon Corporation, a privately-held company based in New York, N.Y., and a provider of technology that can automatically track inventory and measure usage of software running on mainframe computers. Isogon’s operations are integrated into IBM’s Tivoli infrastructure management software business.

Meiosys, a privately-held company based in Palo Alto, Calif., and Toulouse, France, and a provider of unique software technologies that enable applications to be dynamically moved from one server or set of servers to others without disruption.

PureEdge Solutions Inc., a privately held company based in Victoria, B.C., and a developer of electronic forms. IBM integrates PureEdge e-forms into its portfolio of collaboration technology, including IBM Workplace and Lotus offerings.

DWL, a privately held company based in Atlanta, and a provider of customer data integration middleware.


iPhase Systems, Inc., a privately held company based in Bedford, Mass., and a developer of software that improves e-commerce, online service and support, and call center productivity.

Collation, a privately held company based in Redwood City, Calif., and a developer of software that automatically captures information about IT resources and displays it on a detailed map.

Bowstreet, Inc., a Massachusetts-based provider of portal-based tools and technology that helps companies bring together corporate applications, documents, databases and other enterprise information into a single portal application.

Micromuse, Inc., a publicly held company based in San Francisco, and a provider of network management software used by banks, telecommunications carriers, governments, retailers and other organizations to manage their technology infrastructures. Following completion of the acquisition, IBM establishes Micromuse’s operations as a business unit within IBM’s Tivoli software division and incorporates its software technology and solutions into IBM’s Tivoli software offerings, and IBM’s hardware and service.

Lenovo Group Limited completes the acquisition of IBM’s Personal Computing Division in May for $1.25 billion. IBM’s ownership in Lenovo upon closing is 18.9 percent.

Products & Services The company introduces the IBM System z9 mainframe in July. Representing a three-year, $1.2 billion development effort encompassing 5,000 IBM engineers, software developers, technology professionals and security experts from around the world, the System z9 performs as the hub in a new era of collaborative computing. Available in two models (the z9-109 and z9-S54), the new mainframe system can process one billion transactions a day, more than double the performance of its predecessor (the IBM zSeries z990 [“T-Rex”]), run five world-class operating systems, and process up to 6,000 secure online handshakes per second (about three times as many as before).

IBM begins shipping the z9 on September 16.

IBM announces the availability of its Blue Gene (see Science & Technology) supercomputing system, the most powerful supercomputer, at its newest Deep Computing Capacity on Demand Center in Rochester, Minn. The new Center will allow customers and partners, for the first time ever, to remotely access the Blue Gene system through a highly secure and dedicated Virtual Private Network and pay only for the amount of capacity reserved.

In February, the company rolls out the IBM eServer p5-510, designed to bring POWER5 performance and advanced virtualization capabilities to an entry level UNIX and Linux server. In June, IBM previews details of a planned high-density POWER5-based system for highperformance computing. The planned 16-way IBM eServer p5-575 cluster node is capable of sustaining 87.3 Gflops of performance and can achieve up to 55 percent greater speed than the eight-way IBM eServer p5-575 cluster node that was introduced in the fall of 2004. In October, the company debuts four new UNIX systems -- including the IBM System p5-550Q, p5-520, p5and p5-505 -- that are equipped with POWER5+ microprocessor technology and are intended for small and medium-sized businesses. The following month, IBM previews a prerelease version of the upgraded high-density POWER5+ IBM p5-575 supercomputer.

1406HHX An IBM eServer p5-570 running Linux attains a milestone in computing history in August, soaring past other servers and setting a new world record for online transaction processing performance for four-processor servers of 197,669 transactions per minute. In May, the IBM eServer p5-595, IBM TotalStorage DS8300 and IBM DB2 Universal Database 8.2.2 combine to set a new world record on the three-tier SAP Sales and Distribution Standard Application Benchmark.

During 2005, IBM company announces: the IBM eServer OpenPower 710, a low-priced IBM POWER5 processor-based rack-mounted server running the Linux operating system... the IBM eServer xSeries 226, 236, 336 and 346.... the IBM eServer BladeCenter HS20, based on Intel’s new 64-bit Xeon DP processor that use new technologies to increase server efficiency.... the IBM eServer xSeries 460, an X3 Architecture-based system for database processing and virtualized server environments.... the IBM xSeries 100 server, the most affordable server entry point available from a top-tier vendor... the IBM xSeries 206m and xSeries 306m systems.... the IBM xSeries 260,a high performance four-processor server with X3 Architecture designed for remote office locations or storage-intensive applications.... and the IBM xSeries 460 and xSeries 366 servers.

The IBM IntelliStation A Pro 6217, featuring AMD’s new Dual-Core Opteron processor Model 275, debuts in April. At the same time, IBM announces that its eServer 326 high-performance 1U server line will be expanded to include the Dual-Core Opteron processors. Four months later, the IBM IntelliStation M Pro 6218, a workstation using a dual-core Intel processor built from the ground up with server design teams and rigorous xSeries server-proven testing, is launched.

In January, IBM unveils the ThinkPad T43, the company’s fastest-performing thin-and light notebook computer to date; a month later, the IBM ThinkVision L190 19-inch liquid crystal display is rolled out, and two months after that, IBM unveils the ThinkPad X41 ultraportable notebook, weighing only 2.7 pounds. Three new security technologies for IBM’s ThinkPad notebooks and ThinkCentre desktops -- including new biometric fingerprint options, data encryption solutions and embedded notebook traceability tools -- are announced in February.

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