IBM to Merge Microprocessor, Server Divisions


IBM has announced plans to merge its microprocessor and server divisions, a ZDNet story says. IBM CPU division manufactures processors for itself, Apple, Sony and MS, among others.

The new division will be named the Systems and Technology Group. The merger has reportedly been put in place in order to improve IBM's processors. The Server division, itself a recent merger of four different units, is responsible for models such as Blade servers, many of which employ IBM's PowerPC chips, including a version of the PowerPC 970, the chip marketed as the G5 by Apple.

Analysts quoted in the story have different takes on the implications of the merger. Some argue that microprocessors are less important to IBM, and that the chip division will take a back seat to servers in a merged unit. Others argue that the two businesses can live together peacefully.

Analysis: We doubt this will have any significant impact on IBM's Power5 and Power6 development. Big Blue have made extremely significant investments in the Fishkill plant, and the demands server customers make for better, cooler and faster chips should only benefit both sides of the business.