IBM Spinoff Should Rejuvenate Cloud Effort

Finally. On October 9th, IBM announced that it will split itself up by breaking up the company into two pieces, spinning off its legacy IT services businesses to focus on cloud. IBM shares rose about 6% on the news the first day, thought they have pulled back to be close to where they were when the deal was announced.

The change is sorely needed — IBM CEO Arvind Krishna is wise to pursue the strategy as the company needs some sort of catalyst to drive growth in the era of the cloud explosion. This deal should put IBM in a better position to compete with other cloud titans such as Amazon Web Services (AWS), Google, and Microsoft Azure by putting more focus on its prized Red Hat unit. It should also enable IBM to compete more strongly against other large tech conglomerates pursuing cloud, such as Hewlett Packard Enterprise (HPE)

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