FollowThe Chinese server market faces increasing challenges, as IBM teams Inspur and change their market approach. IBM was affected by China’s latest policy addressed to U.S. companies. The Chinese Government wants to achieve informational independence. To gain it, the government wants to only rely on Chinese information administration firms.
The policy affected IMB, while Chinese server producing companies such as Lenovo, Huawei increased their market share. Dell remains the leader of the category of x86 servers with 20 percent market share. Lenovo owns 13 percent, while Huawei holds 14 percent of the Chinese server market.
The Chinese government announced concerns over server security recently. IBM managed to find a solution to continue doing businesses in China. IBM and Inspur, aka I2I, will offer a new product. Inspur produces the TS K1 systems and IBM will contribute with software packages, DB2 and WebSphere Application Server. Moreover, IBM will provide POWER8 processors to Inspur and other technical assistance to Inspur to help the company grow.
IBM teams Inspur because of the latest political decisions
Chinese companies are growing and need improved technology to analyze big data, this is the reason backing the new I2I allegiance declared on Friday. IBM sold the low-end server division to Lenovo at the beginning of 2014, although the take-over is not yet finished. By selling the low-end server business, Lenovo dropped its Chinese market share to just 12 percent, equaling Inspur’s market share. The Jinan-based Chinese company increased its market share from just 5 percent a year before.
Servers are now an important political technology. Russia demanded recently that all data belonging to Russian citizens must be stored on servers placed on Russian soil. China accused Apple of producing hardware that is easy to use for spying. As well, some Chinese produced smartphones that were allegedly storing private data of U.S. users and sending it back to China. Undeniably, the latest events can be properly understood through a political economic lens.
However, neither IBM, nor Inspur, made any reference to cyber-politics and security in their announcement on Friday, according to Reuters. The Snowden affair complicated politics, as well as businesses. The reasons behind the new alliance are undeniably linked to the political environment. However, even if IBM teams Inspur, most companies prefer to avoid political discourse, at it is usually seen as a drawback in efficiency, because of future implied stability risks.
