No need for alarm, says IBM

By Kaunda Chama for IBM

Johannesburg, 10 Feb 2005

Gareth Hansford, IBM`s director for personal computing for UK, Ireland, Netherlands and SA, says the sale of the company`s PC division to China-based Lenovo Group will not have a negative impact on its business with clients and channel partners.

His comment comes amid uncertainty over future IBM products in the global PC market.

IBM sold its PC division to Lenovo Group and took a 19% minority stake in the former rival in the recent deal, which was valued at $1.75 billion.

The companies plan to form a complex joint venture that will make Lenovo the third-largest PC maker in the world, behind Dell and HP, while still giving IBM a hand in the PC business.

Hansford says the move will also make the PC business more competitive and broaden its reach.

IBM has always focused on enterprise and small and medium enterprise customers, and it believes Lenovo will help it penetrate other markets - such as the home and retail markets - and help the company move up from the number three slot.

The companies do not envisage a name change in the products for at least the next five years and the products will continue to come from the same production lines with the same teams working around them. This will be complemented by a combination of both companies` R&D resources and IBM will continue to provide PC customers with support and services.

Hansford says the Lenovo name will "start showing up" on the products within the next five years.

On the channel side, Hansford says there will be no changes. His sentiments are echoed by local PCD executive Rashid Wally, who says IBM has committed more resources to look after channel partners.