IBM 2001 Annual Report Download - page 49

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•WebSphere
—
our suite of products that allow businesses
to build, deploy and manage all manner of e-business
operations, grew 50 percent and significantly outpaced
its competition.
•Lotus remains the market leader in collaborative
middleware, and Tivoli, which develops security and
software management products, got stronger through-
out 2001 after working through management and
product transitions.
Services
In the early 1990s, I was one of the starry-eyed optimists
who were flying around closing the initial services con-
tracts. Well, today, IBM is a services-led business in a
services-led industry.
Our services story in 2001 mirrors what happened
across our entire portfolio: some businesses up, some
down, but on balance a solid performance
—
with
underlying dynamics that point to continued strength
this year.
The positives start with a dramatically improved
services profit performance, contributing nearly half of
all IBM pre-tax profit for the year. We increased revenues
from services associated with e-business and strategic
outsourcing; and revenues from Web hosting jumped
35 percent. Contract signings remained strong, and we
closed the year with contracts for $102 billion in future
services revenue.
Even in difficult economic times, customers invest in
services to manage technical complexities and financial
risks
—
and especially in the world of e-business, to trans-
form their businesses. However, while some areas of
services are countercyclical, others tend to correlate very
closely with economic conditions. That’s especially true
of high-value I/T consulting services
—
a business that
had to work through a significant transition in 2001. As
the market shifted and customers deferred spending
on consulting engagements, we were initially slow to
respond. Throughout 2001, we took steps to rebalance
skills in our consulting and systems integration businesses.
Based on that work, and a strong pipeline of signings
headed into 2002, we expect a markedly improved per-
formance across our services business this year.
Enterprise Systems
Across enterprise systems
—
eServers and storage
subsystems
—
we had a strong year and gained 3 points
of share.
•Revenue from our zSeries mainframes increased
—
our
first full year of revenue growth in the mainframe busi-
ness since 1989
—
and we saw a double-digit increase in
shipments of computing capacity.
•Our UNIX servers gained significant share. Literally
five years to the day after we promised leadership in
microprocessor technology on a UNIX platform, our
technical team delivered Regatta, the world’s fastest UNIX
server. Customer demand has been strong.
ceo’s letter
47