Cringely, one of the first Apple employees and the author of Accidental Empires, the only history of the computer industry, makes about 10 predictions at the beginning of each year. At the same time, he also goes over his previous year's guesses to see what he got right.
Last week, IBM's shares got a big boost after chief executive Ginni Rometty stepped down and Arvind Krishna, former head of IBM's Cognitive Computing unit, was announced as the next CEO.
Cringely said Rometty was a failure, but mainly because she was unlucky. "She bought 57 companies in her time running IBM. How many of them can you name? How many of those acquisitions can you say were successful? Red Hat, maybe?" he asked.
"Either it will go to private equity (depends on the total debt load) or it will be sold to HPE or maybe to Oracle. Either way, it’s not a likely success story, but Rometty has no real choice. IBM is, at this point, smoke, mirrors, and buybacks. The GTS windfall will land in Ginni’s final quarter, juicing her payout, which might be the major point of the deal," he said.
However, he did not give GTS much chance of lasting long. "Whoever buys GTS will be a big winner for a few years. The losers will be all the IBMers who go with that deal," Cringely said.
"There will be massive layoffs of redundant staff, salespeople, and support teams. Profits will soar as the IBM staff is fired. The new owners will create a cash cow to pay down the purchase price while expanding their IT footprint. But supporting data centers and large integrations of hardware are so last century…"
Cringely predicted that the Cloud unit would also be hawked to someone by summer in 2021. Jim Whitehurst, the current head of Red Hat, would become the head of what was left of IBM.
"Whitehurst will turn IBM into Red Hat, which will take HQ to North Carolina and mean most of the remaining GBS staff will be gone in a year," he said.
"That’s because software is everything for Red Hat, which means certifications proving staff can actually do what they are being paid to do.
"But IBMers don’t believe in certifications; they are IBMers. In the end, nothing can be done for these people, so the answer will be to release anyone without the proper certifications, helping Red Hat realign the company in 2021."
What would remain under the IBM name would be GBS - but that also would not last long, Cringely predicted, adding that he would give his reasoning for this forecast in another prediction soon.