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July 23, 1987

IBM FORMS DEDICATED APPLICATIONS UNIT, TIGHTENS MID-RANGE

By CBR Staff Writer

IBM has suddenly woken up to the fact that while it may be by far the biggest software company in the world by virtue of its pricey system software, it is becoming critically weak in applications, and has taken energetic steps to address the problem. It has created a new Application Systems Division with a mission to develop applications, and, more importantly, to stomp the world looking for programs that can plug some o fthe yawning gaps in its offerings, particularly in the mid-range, where its problem is put into graphic focus by Marc Shulman, analyst at Salomon Brothers, who reckons that in one key market area, DEC can muster 3,000 applications, IBM a mere 350. IBM also confirmed that it is squashing the squabbling among its mid-range marketing people and putting everything firmly into one command (CI No 730). IBM vice president Joseph Guglielmi is president of Applications Systems Development, reporting to Edward Lucente, IBM vice president and Information Systems Group executive. The new software unit will be headquartered in Milford, Connecticut, while its software development and evaluation activities will be based in six laboratories in the US and in five in the rest of the world. The joint venture with Lotus Development on a mainframe 1-2-3 is presented as a role model for the kind of collaboration it is seeking. The new mid-range initiative involves appointment of Larry Ford to the new position of assistant group executive, mid-range systems in the Information Systems Group. IBM also announced that it has strengthened the IBM Information Services organisation to increase its focus on tgo key growth areas – the IBM Information Network worldwide data communications network service, and US commercial Systems Integration and Professional Services as part of IBM’s effort to grow big in systems integration. Information Services, which formerly had responsibility for US application software development, now part of the new software unit, has been given responsibility for custom workstation product development and for acquiring complementary products to meet customer needs. IBM Information Network headquarters functions, shared between Milford and Tampa, Florida, will be consolidated in Tampa.

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