IBM: building growth through software, not services

Steve asked the question is the old IBM coming back- promoting its own software products even if they are not the best solution.  I think IBM's results suggest that the 'old' IBM is coming back  And I agree with Steve when he says:

"It would be a real shame if [IBM Global Services' independence] was compromised by a limitation to only using IBM's own tools."

Unfortunately, the recent evidence suggests that IBM's engine of growth is no longer services but will now software with all the consequences for the role of IBM Global Services. 

Specifically, looking at IBM's recently announced results and associated comments in Information Week it is clear that their recent acquisition strategy and overall software strategy are paying off - particularly in the SOA space:  Software sales were up 8.5% - which was the strongest growth across the three groups.  Websphere software sales were up a staggering 30%. 

Excellent news for IBM shareholders and potentially good news for other enterprise software companies if it is part of a rising market.  However, financial analyst Marc Heilweil suggests that this also reflects a change in emphasis:

"IBM is in line with a trend in business, which is to have this complete package, their strategy is to be able to offer a complete suite" of hardware, software and services.

A strategy of offering the complete hardware, software and services solution clearly excludes using the best of breed solutions and hence changes IBM Global Services' role and its independence.  This single platform strategy does give IBM's customers the benefit of the mythical 'single throat to choke'.  But it also means in some cases providing a sub-optimal solution as it excludes excellent offerings such as those highlighted by Steve and includes some creaky, aging pieces of software such as the  Mercator products (acquired as part of Ascential) which have been rebadged (again) under the WebSphere SOA branding but not fundamentally changed for many years.  IBM's customers need to watch out that their throat isn't the one that is choking