IBM CEO on historic Red Hat deal: We’re the No. 1 enterprise provider
IBM made history in October after it agreed to buy Red Hat for $34 billion. IBM CEO Ginni Rometty told FOX Business the deal propels the company to the top of the cloud-computing industry.
“We will now be the leader in the hybrid cloud and that is the destination -- we'll come back to hybrid versus just the cloud. And it is 200 basis points [increase in revenue] to IBM,” she said to Stuart Varney on Tuesday. “But it is more about what clients need in order to modernize all their mission-critical applications which is 80 percent of what's left to be modernized, and Red Hat's the important piece of that.”
Red Hat helped make software technologies such as Linux and Java household names and will work with IBM to implement “Chapter 2” of the cloud for customers.
“What we can bring together is the power of this next generation technology which lets them develop applications much more quickly to serve their customers and at the same time be able to run in a mission-critical production way and be able to pull data throughout their systems,” said Red Hat CEO Jim Whitehurst, who was also part of the interview.
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Varney also pressed Rometty on whether the deal will improve IBM’s leadership positioning.
“Ginni when I think of the technology of America -- American technology companies -- I don't see IBM in a leadership role. I see Microsoft, I see Google, I see Facebook, I see Amazon," Varney said. "I don’t see IBM right up there with the movers and shakers of the technology world. Will this do anything to improve your position?”
“Well look, I should very much clarify that for you. We are the No. 1 enterprise provider to the banks of the world, the airlines of the world, the credit card companies of the world. And so IBM is No. 1 in the enterprise,” she explained.
"In the cloud area, many years people have said 'gee, the whole world is going to move just to a public cloud. We've believed, and put the pieces in place, that that's not actually the destination. This does make us the leader in what I believe the destination is now for the enterprise,” she added.