IBM offloads customer services biz for half a BEELLION DOLLARS

Sells up 'commodity business' BPO to US tech distie Synnex


IBM is planning to outsource its Business Process Outsourcing customer services after last night confirming plans to offload the unit to US tech distie and BPO player Synnex for $505m.

Under the terms of the deal, Synnex will cough $430m in cash and $75m in stock to take on 45,000 soon-to-be-ex IBMers operating across a network of 50 plus global delivery centres.

The business will be housed in the Concentrix subsidiary and will enter into a "multi-year agreement" with Big Blue, the firms said.

Kevin Murai, president and CEO at Synnex, claimed in a canned statement that the acquisition will make it a "global top 10 player in this growing market".

Synnex will provide "customer care" BPO services to clients in 12 industry sectors, the firm added.

IBM said last night it will continue to invest in the BPO services space in areas including finance and administration, procurement and supply chain management, HR and Smarter Workforce, and mortgage origination and servicing.

John O'Brien, research hound at TechMarketView, said "[IBM's] aim is to better exploits its investments in software and platforms and closely align them more closely with BPO".

The disposal signalled a "major shift" in the way Big Blue intends to deliver BPO services which could have "significant implications" for the market, said O'Brien.

He added it was "clear for a while now" that IBM views customer services "at an increasingly commodity end of Business Process Services (BPS)".

"Social, mobile, analytics and cloud are transforming this space, but IBM wants to support clients through this customer experience transformation, rather than delivery the actual operations," he said.

The transaction is expected to close in the next couple of months subject to regulatory requirements and customary closing conditions. ®

Similar topics

Narrower topics


Other stories you might like

  • IBM finally shutters Russian operations, lays off staff
    Axing workers under 40 must feel like a novel concept for Big Blue

    After freezing operations in Russia earlier this year, IBM has told employees it is ending all work in the country and has begun laying off staff. 

    A letter obtained by Reuters sent by IBM CEO Arvind Krishna to staff cites sanctions as one of the prime reasons for the decision to exit Russia. 

    "As the consequences of the war continue to mount and uncertainty about its long-term ramifications grows, we have now made the decision to carry out an orderly wind-down of IBM's business in Russia," Krishna said. 

    Continue reading
  • IBM AI boat to commemorate historic US Mayflower voyage finally lands… in Canada
    Nearly two years late and in the wrong country, we welcome our robot overlords

    IBM's self-sailing Mayflower Autonomous Ship (MAS) has finally crossed the Atlantic albeit more than a year and a half later than planned. Still, congratulations to the team.

    That said, MAS missed its target. Instead of arriving in Massachusetts – the US state home to Plymouth Rock where the 17th-century Mayflower landed – the latest in a long list of technical difficulties forced MAS to limp to Halifax in Nova Scotia, Canada. The 2,700-mile (4,400km) journey from Plymouth, UK, came to an end on Sunday.

    The 50ft (15m) trimaran is powered by solar energy, with diesel backup, and said to be able to reach a speed of 10 knots (18.5km/h or 11.5mph) using electric motors. This computer-controlled ship is steered by software that takes data in real time from six cameras and 50 sensors. This application was trained using IBM's PowerAI Vision technology and Power servers, we're told.

    Continue reading
  • IBM buys Randori to address multicloud security messes
    Big Blue joins the hot market for infosec investment

    RSA Conference IBM has expanded its extensive cybersecurity portfolio by acquiring Randori – a four-year-old startup that specializes in helping enterprises manage their attack surface by identifying and prioritizing their external-facing on-premises and cloud assets.

    Big Blue announced the Randori buy on the first day of the 2022 RSA Conference on Monday. Its plan is to give the computing behemoth's customers a tool to manage their security posture by looking at their infrastructure from a threat actor's point-of-view – a position IBM hopes will allow users to identify unseen weaknesses.

    IBM intends to integrate Randori's software with its QRadar extended detection and response (XDR) capabilities to provide real-time attack surface insights for tasks including threat hunting and incident response. That approach will reduce the quantity of manual work needed for monitoring new applications and to quickly address emerging threats, according to IBM.

    Continue reading
  • Compute responsibly: Yet another IT industry sustainability drive
    From greener datacenters to data transparency and 'conscious code', IBM, Dell, others push for better IT ops

    IBM and Dell are the founding members of a new initiative to promote sustainable development in IT by providing a framework of responsible corporate policies for organizations to follow.

    Responsible Computing is described as a membership consortium for technology organizations that aims to get members to sign up to responsible values in key areas relating to infrastructure, code development, and social impact. The program is also operating under the oversight of the Object Management Group.

    According to Object Management Group CEO Bill Hoffman, also the CEO of Responsible Computing, the new initiative aims to "shift thinking and, ultimately behavior" within the IT industry and therefore "bring about real change", based around a manifesto that lays out six domains the program has identified for responsible computing.

    Continue reading

Biting the hand that feeds IT © 1998–2022