IBM in 2006. Ripe for deconstruction.

In a post last week, James Governor wrote "Gartner is like a mainframe in 1979. Ripe for deconstruction."

What about IBM itself? Almost 100 times Gartner's size - and still the "mainframe" of 2006.

IBM is the largest technology services vendor in the world -  services revenues larger than those of EDS, Accenture and the 5 largest Indian firms put together.  Even after spinning off its PC division, it still sells twice as much hardware as Sun. It sells almost twice as much software as SAP.

It talks about its commitment to Linux and open source and the "bazaar", but continues to use the "cathedral" - structured, traditional approaches in its own software and services. The old icon of US technology innovation spends only 7% of its revenues on R&D.  Microsoft with less than half its revenues spends as much on R&D. And most of IBM's innovations appear to come from the numerous acquisitions it makes. It is the symbol of what I call utility spending that eats up too much of incumbent IT spend.

We can and should pick on Gartner.

CIOs would much prefer - and certainly benefit a lot more - if we picked on IBM (and Microsoft and EDS and others). Question why it is not much more innovative and much, much cheaper. Call it something nicer than deconstruction if you want. But needs to be done. As Willie Sutton would say "that's where the money is"

Update: See Nick Carr's post Is the server industry doomed?