Big Blue? More like Big Blew It: Here's a quick and easy way to ruin your PC brand: Sell it to a Chinese manufacturer. According to a survey published by Merrill Lynch, legions of IBM customers will consider switching vendors as a result of the sale of the company's PC divsion to China's Lenovo. "Almost half of IBM PC users said they would consider switching, a high figure even recognizing that not all will," said Merrill Lynch VP Steven Milunovich. "More problematic for IBM is the finding that PC switchers might buy less of other IBM products as well." No doubt. Certainly, IBM's customer loyalty is already suffering. Witness James Gaskin's latest screed in ITWorld. "I think the IBM PC sale to Lenovo is the worst kind of management stupidity and darn near traitorous," Gaskin writes in a piece entitled "The IBM PC Deal Sucks." "If Lenovo makes most of the IBM PCs already, yet IBM loses a billion per year or whichever number you trust about this story, that tells me IBM management overhead has gotten seriously out of whack. Speaking of whack, let's go to Armonk and whack two of every three executives with a pink slip and see if the PC division can make a profit now. Bet it will. Second, how can management of the world's most advanced technical manufacturer (at one time, anyway) get suckered into outsourcing the majority of production to a single overseas vendor? Suddenly that vendor can afford to buy out the company they've been working for? If I was an IBM shareholder, I might start a class action suit for fraud against management for letting this happen while they're supposed to be 'stewards' of my capital investment."Will someone from IBM please spend more time explaining this deal and the strategy behind it? As I've stated a number of times before, I just don't get it. I'm willing to bet that Big Blue won't be very big for very long.
John Paczkowski, from SiliconValley.com's daily newsletter wrote the following today (I couldn't agree more):