IBM to quit China PC business
(Xinhua)
Updated: 2004-12-06 14:04

The top computer provider worldwide, IBM, is likely to quit its PC business in China, as it gradually withdrawals from the personal computer (PC) market.

"IBM will focus on game machines in the future," said Bernard Meyerson, vice president and chief technologist with IBM System & Technology Group.

Meyerson's statement echoes Gartner's recent report, which predicted the global PC market will step into a period of sluggish growth and three of the world's top ten PC providers will be squeezed out of the market. He said IBM and HP have the highest possibility of not making the cut.

Nigel Beck, who is accountable for product management and marketing of IBM, acknowledged that PC profits have kept dropping,and IBM holds that game machines will become the next-generation advanced platform.

A staff member with IBM System & Technology Group, who declined to be named, noted that IBM has decided to quit the PC business in China.

"We had planned to transfer our portable PC technology to International Information Products (IIPC), as reported by some media, but have canceled the decision because of IIPC's limited capacity," he said.

Merrill Lynch Analyst Steve Milunovich said in his latest report that game machines will be the next generation in computing.IBM will become a beneficiary of the trend since it is moving its micro-electronic technology away from the ebbing PC business.

Fang Xingdong, chief analyst of Internet China lab, was pessimistic about IBM's manufacture of games machines, saying that games products do not suit the company's culture, it would be a wise choice for IBM to supply high-quality chips for major games producers like Sony.

As a matter of fact, IBM, teaming up with Sony and Sony Computer Entertainment Inc (SCEI) introduced the first cell-based work station prototype machine on November 29. The optimized "cell" chip is suited precisely for various broadband media, including games, films and other digital medium.