Tuesday, October 18, 2005

Tues - IBM excells with small & medium sized customers

IBM's latest results, covered in an earlier post, reveals an interesting development. One of the brighter areas of growth was to the small and medium sized (SMB) business sector.

In the SMB market, IBM's 3rd quarter revenues rose a strong 10%, to $4 billion, the second consecutive quarter of double-digit growth. SMB now accounts for 20% of IBM's overall revenues, so it's big enough, potentially, to be a growth engine for the whole company.

IDC expects the global SMB market to increase 7.6%, to $140 billion, this year, compared with 5.6% for the overall tech industry. Growth is happening fastest in emerging economies, including China, India, Brazil, and Russia, where IBM is rapidly trying to expand operations. The company concentrates on outfits within the segment with 100 to 1,000 employees, which is more the medium sized business than the small one.

But, with company's such as Dell moving more into services the question is how long can IBM enjoy this growth and what new products or services will they need to offer to stay ahead in the SMB sector?

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