back to article IBM to spin out Managed Infrastructure Services biz – yes, the one that was subject to all those redundancies

IBM has confirmed a "tax-free" spin-off of its Managed Infrastructure Services unit into a separately traded public company, expunging a part of Big Blue that has been shrinking and subject to years of cost-cutting. The division of Global Technology Services will get a brand spanking new name – NewCo – and IBM sought to talk …

  1. RM Myers Silver badge
    WTF?

    NewCo

    This sounds like a name someone put on a chart as a placeholder, and no one could be arsed to come up with anything better. Has IBM just stopped caring any more? If I was an exployee of NewCo, I would be looking for NewJob pronto.

    1. Anonymous Coward
      Anonymous Coward

      Re: NewCo

      Its exactly that.

      Its a legal container for the stuff they are selling, then someone else will spin merge with it.

      DXC likes bad acquisitions, maybe its DXC.

    2. Anonymous Coward
      Anonymous Coward

      Re: NewCo

      They put the name as a place holder as it was 5PM with the intention of updating it the next day.

      When they arrived the next day, they found they had been made redundant so it never got done.

      The task has been handed over to a project manager in a lower cost part of the world and when a suitable replacement is hired in 3-6 months the task will be completed.

    3. spold Silver badge

      Re: NewCo

      Yes, secretly, management decided that Newco was better than the real name they had in mind... IBM Golgafrinchan Ark Fleet Ship B. It does away with paying for all the redundancies.

    4. circusmole
      Happy

      Re: NewCo

      It has the ring of CostCo about it.

    5. Lord Elpuss Silver badge

      Re: NewCo

      What AC said. NewCo is a generic name that companies are given before they’re fully formed, so discussions and legal frameworks can be drawn up without having to be rushed into coming up with a name/logo etc already.

      It means nothing, and will (almost) certainly be changed to a RealName some time between now and the actual spinoff date.

      One demerit point to the Reg for not pointing this out in the article.

  2. Anonymous Coward
    Anonymous Coward

    We love you. You are number one in the market. Customers love you.

    Now off you fuck....

    <back to counting predicted bonus money for lopping off another part of the company>

  3. 2+2=5 Silver badge
    Facepalm

    > Some IBMers say they found out about the move after the stock market.

    In other news, some IBMers know nothing about stock market rules and insider trading legislation.

    1. Jimmy2Cows Silver badge

      The rules don't say staff aren't allowed to know about such things, just that they aren't allowed to talk about them to anyone outside the company.

      Whether the company chooses to tell they minions is up to the company. Some do, some don't.

      (Just been through an IPO; we were told about it way in advance and reminded many times about insider trading rules).

      1. Lord Elpuss Silver badge

        If you tell 400,000 people, it will get leaked. Only way to keep it on the down low is not to tell them.

      2. paulf
        Boffin

        Exactly. When I worked at a listed company they would announce new stuff (often market sensitive, e.g. results) to employees at 1630 i.e. after the markets closed. The public announcement, to the markets and the great unwashed, was at 0700 the following morning just before the markets opened.

        We were all told multiple times that some information was confidential until the next morning, with an exteded remix of the company's insider trading rules, and that some information was completely confidential as it was internal and wouldn't be announced publicly. That way the company did employees the courtesy of telling them first, without causing too big an insider trading risk beyond the C-Suite.

        TBH there was no reason IBM needed to annouce this to the markets before employees, other than being shits, and that's not exactly news.

  4. Anonymous Coward
    Anonymous Coward

    Pension Split also happening

    I also had an email today indicating that the Defined Contribution and Defined Benefit parts of the pension scheme were going under separate management.

    What's the odds this is a way to dump the DB fund and have the taxpayer pick up the tab?

    1. RM Myers Silver badge
      Thumb Down

      What's the odds this is a way to dump the DB fund

      I would say there is a 99.9% chance, but then I tend to be optimistic and give them the benefit of the doubt.

  5. SB37

    Cringely was right all along:

    https://www.cringely.com/2020/01/31/predictions-for-2020-ibm-and-trump/

  6. SB37

    This would explain why IBM just laid off several very experienced mainframe techies from their profitable UK zCloud team.

    It makes NewCo look cheaper to potential buyers. But those skills are gone.

    And as for them backfilling those roles from Indian and Hungary as was mooted, good luck.

    1. Sean o' bhaile na gleann

      'SB37' love that nickname!

      Might change mine to IDC3009I

  7. amacater

    Nobody ever got fired for buying IBM

    So what's left now - some research divisions, some patents and Red Hat. Red Hat is a great contrtbutor ot opensource but it's not the world of cloud entirely - AWS isn't Red Hat, Canonical want to eat Red Hat's lunch in managed cloud infrastructure that isn't AWS ...what pays the bills? Attack dog lawyers may save something but ...

  8. Anonymous Coward
    Anonymous Coward

    New name = IBG - InfrastructureBeGone !

    So "ibm" will be left with a cloud service that isn't competitive or modern and no one wants, and an "ai" division that is total rubbish and those that have been suckered into buying it get out as soon as they can?

    What could possibly go wrong!

    Mega bonus to Ginni as a final hurrah....

  9. sbt Silver badge
    Facepalm

    Meet NewCo, same as the old ISSC.

    It's been done. But hey, those deck-chairs won't re-arrange themselves!

  10. Anonymous Coward
    Anonymous Coward

    Never been so glad I retired

    So: 45-50 years in IT. Retired a little over a year ago.

    Last 10 of which was as a Service Delivery Manager responsible for oversight of the IBM delivery of (in my little slice of the world) mainframe services. Note that this is a large healthcare enterprise: serving over 10 million members, across 8-10 states, with 300,000 employees... including 80,000 physicians, and a massive, robust, EHR system. Mainframe is a teeny-tiny piece of this (even at north of 30K MIPS), but (as mainframer's might expect) a critical component of several key applications.

    IBM Global Services operates pretty much the entire infrastructure; mainframe, *NIX, Wintel, etc.

    My heart goes out to my (former) IBM partners, my (former) teammates on the Service Delivery team, and my (former) employer, who remains my healthcare provider.

    I hope IBM doesn't screw things up with this transition as (overly dramatic music plays in the background) people's health and even lives depend on IBM GS services maintaining operational stability of the systems they support.

  11. SecretSonOfHG

    I was right in 2015... and this is only the start

    Look up https://forums.theregister.com/forum/1/2015/07/20/ibm_q2_2015_results_mainframes_middleware/ when I said

    "All I can see is IBM slowly fading into irrelevance and reducing itself to two almost independent companies: one a very small, highly profitable, cluster of captive mainframe customers (these will remain IBM customers literally forever) Another made of the small army of lawyers, this time specialising in patent licensing. But this part will not last more than 30 years: on the long term, IBM can't sustain any significant R&D investment if they can't turn it into profits outside patents, something they have been unable to achieve for the last 20 years."

    It has now started...

  12. David Neil

    Awkward

    So EY just dumped a load of their IT people onto IBM as of 1st October, who now find they are being shuffled onto NewCo.

    EY who had signed up a nice deal to get IBM cloud services a week before they announced the cull.

  13. Unicornpiss Silver badge
    Meh

    Too much bad blood

    IBM has practiced such reprehensible behavior with its business and employees that I hope people in IT leadership positions are taking note and looking for (slightly) less scummy alternatives. If enough people would make the ethical decision to not patronize companies that treat their employees like crap, the world would be a better place. Now excuse me, I'm off to see the glorious blue sunrise with my unicorn..

    (NewCo, really??)

    1. Anonymous Coward
      Anonymous Coward

      Re: Too much bad blood

      troll much.

  14. Doctor Syntax Silver badge

    "It will leverage its unrivaled expertise..."

    I thought the unrivalled expertise had already been levered out as being too expensive.

  15. StrangerHereMyself

    Are you serious?

    NewCo?! Whoever came up with THAT? That person should've been one of the redundancies.

    AFAIK there isn't a prize for these kind of stupid sounding names, but if there is NewCo would undoubtedly one of the runners-up.

  16. Anonymous Coward
    Anonymous Coward

    From the Ryan Howard Management Team

    IBM Cloud Infinity!

    ...and the other less stock-market sexy group, "New some-thin ...."

  17. Robert D Bank

    NewCo...very close to NukeCo....coincidence?

  18. Anonymous Coward
    Anonymous Coward

    IBM have been itching to dump the Managed Infrastructure Services division for years.

    For years & years, thousands of IBM GTS employees haven been made redundant and with the new CEO his 'great plan' is to just dump the division and run... oh probably taking massive bonus for the trouble!

    If you watched the CEO's 'All hands call' the day after the announcement to the stock markets there was an odd video with no social distancing and masks being taken off/on and then in the end they just didn't bother LOL! The next day Arvind Krishna had a Q&A meeting, answering a few IBMers questions posted on SLACK. You could tell he wasn't in the mood and gave short, sharp answers then decided to end the Q&A & cut the video link abruptly.... which was nice, not!

    It will be interesting to find out what happens to those IBMers in this 'NewCo' i.e. existing employee rights, pensions and even what global offices they can work from, if any? You can already see this isn't going to end well for IBM and this 'NewCo' as IBM are nowhere near Amazon & Microsoft for Cloud services. The 'NewCo' will be taken over by another corporate co. just to access the clients on their books and they will then dump thousands of old IBM employees.

    Thanks a lot IBM.

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