IBM x86 Server Business: Still Up for Sale

IBM is still trying to sell its x86 server business and talks with Lenovo apparently are back on. But don’t expect a sale this year. During an earnings call last week, IBM indicated that a “large divestiture” may slip into 2014 rather than 2013.

IBM has never officially confirmed that the pending divestiture involves its x86 server business. But most pundits think that’s the case. And today, TechTarget reported that Lenovo is speaking with IBM again about buying the company’s System X and BladeCenter business.

Still, IBM remains committed to its higher-end server business — including the PureFlex System, which converges compute, storage, networking, virtualization and management. In recent months, IBM has been promoting PureFlex Systems to managed services providers (MSPs).  

At the low-end of the server market, IBM seems concerned about commodity competition and the shift to cloud computing. When Microsoft killed Windows Small Business Server in 2012, it was a wake-up call for all server hardware makers in the SMB market. 

IBM apparently heard the warning very clearly, and has been shopping its x86 server business in recent months. Will Lenovo or another potential buyer step forward to complete the deal? Hmmm…

In the meantime, IBM revenues have been slipping and CEO Ginny Rometty has cut headcount.