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Why the Apple-IBM deal matters

James Niccolai and Martyn Williams | July 16, 2014
Times have changed since Apple's '1984' commercial bashing IBM.

It's now partnering with a company that bends over backwards to understand the needs of its corporate clients. That gives Apple a valuable distribution channel in the enterprise without having to change greatly how it operates.

"What it allows Apple to do is not change its philosophy and lay off to IBM the whole issue of, how do you make iPhones work for IT managers who actually want to be treated like a valued customer," Kay said.

The deal is also notable because it's unusual for Apple, which is usually a lone wolf, to align itself so closely and publicly with a major partner. That, in turn, could help IBM shed some of its stuffy corporate image.

"Instead of being the black-and-white guys they throw the hammer at, they become part of the winning team," Kay said, referring to Apple's "1984" ad depicting IBM as a corporate villain.

Not everyone saw it as a landmark deal. Jack Gold, president of J. Gold Associates, noted that IBM has forged such deals before, with BlackBerry and the former Palm Inc.

He said he wasn't surprised by the deal, which allows IBM's enterprise software group to expand its client base among customers who need more support for iOS. "IBM has done these types of deals in the past," he said.

Industry analyst Charles King of Pund-IT said the deal will "carry weight" but that it's hard to tell how much. A lot of companies have already created workaround apps for mobile devices, he said.

"Having official IBM support for those 100 [apps] will be attractive to some core IBM constituencies, but it's hard to say how many will jump to replace what they have now," King said.

The deal may hurt Microsoft in particular, he added.

"The users that Apple and IBM will be going after with this deal are exactly in the crosshairs that Microsoft has been going after in the last few years with Windows Phone," King said. "It's one more thing for them to contend with and one more headache."

Carolina Milanesi, an analyst with Kantor Worldpanel, said the combination of Apple and IBM could mark the end of the road for BlackBerry. Apple now gets to tackle the business market with a sales and support staff that is well-versed in enterprises.

"I think for BlackBerry this might be the last straw," she said.


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