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In January IBM decided to sell its server business to Lenovo, China. Today about 15% of IBM’s revenue comes from hardware. Cloud computing and services are the ways to a smarter planet it seems. IBM has a well-established consulting business and a wonderful brand so this new approach will be an easy evolution for customers to understand.

The leader in cloud computing is, and will probably continue to be, AWS (Amazon Web Services.) They were the first big player in on-demand cloud services. Microsoft is doing cloud, as are Verizon, Google and lots of others.

One player doing a great job for a while but who lacks some brand strength is Rackspace. They’re not your average by-the-pound cloud provider. Sadly, their name suggests so. You’ve heard the term value-added-reseller? Well, the name Rackspace is about as far from value-added as possible. They may as well have called the company Cloud Vacancy. Hee hee.

Rackspace doesn’t need to change its name (though it wouldn’t hurt). What it needs is a plan to embed some serious meaning into the brand.  It could use an organizing principle that embodies all the smart people, processes and hardware/software advantages this company bestows upon users.

Brands are not empty vessels into which one pours meaning. They are full vessels — overflowing often — mostly in need of organization, an idea, and discipline. Peace.

 

 

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The Svelte Apple?

As big as the Chinese mobile phone market is, I’m not sure Apple should be pursing its current growth plan there.  And last year Apple sold 23 million phones in China. The price of an Apple mobile in China is in the US$700 area. The price of a locally produced Android based phone US$100.

In my view Apple should attack the Chinese market with a local start-up.  Don’t dumb down and feature down the 5Cs and 5Ss, to get the price margin better.  Leave them as they are, priced as luxury phones for the up market consumer. Start a new company to fight more fairly the Chinese manufacturers Lenovo and Huawei and South Korean behemoth Samsung.

Keep your R&D eye on the ball in America, the ball being other internet connected devices. We forget that Apple, when not bothered by business blocking and tackling (and shareholding-focused share gain), has a history of inventing new categories.  I fear that with all this energy focused on selling iPhones in China, Apple will regress in the ROW (rest of world) and start to slide.

Small share in PCs gave birth to the Apple of today. Stay the course. Innovate the form, the features and the software. Technological obesity in unbecoming. Especially for the svelte Apple. Peace.

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I blasted Enfatico and Dell yesterday for a campaign idea that isn’t…and today I see one that is. It’s from IBM. Both campaigns operate in a similar space. Dell is teaching us that individuals can make a difference in business by “taking their own path.” IBM, with its new campaign, teaches us that people can make a difference on the planet by assembling and using data in smart ways, under the rubric "think."  The Dell approach uses borrowed interest while IBM’s uses core brand values. The way technology insinuates itself into these stories will impact the companies respective bottom lines.

 

 IBM highlights global problems like healthcare, drinking water, traffic, congestion – all fixable with smart data analysis and machines. Dell uses warm and fuzzyish people stories outlining personal and professional change, which even in India where the campaign is breaking, is just not right for the times.

 
I wonder if IBM regrets selling the ThinkPad brand? When this campaign works and if IBM steps up, Lenovo might just be back in the fold before you know it. Think.

 

 

 

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Le-grow-vo

 

Lenovo, the Chinese computer company that purchased IBM’s PC business in 2005, has decided now is the time to drop the IBM name which they are allowed you use until 2010.  With quarterly PC sales nearly twice the industry average, Lenovo feels it is time to spend its money banking equity in the Lenovo brand, not borrowing it from IBM.
 
They will continue to use the ThinkPad name, but that, too, will probably recede in a year or so. Lenovo is doing some serious old-school blocking and tackling while the newer breed of PC manufacturers are trying to find their footing in PC 2.0.
 
With a huge population base in China and a pool of engineers graduating in record numbers, I’m betting Levovo will be eating up marketshare and be the PC leader in 2010.
 

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