In the wake of Carly Fiorina's departure from HP (Palo Alto, Calif.), rival IBM has stepped up its efforts in the financial-services industry, particularly around storage and servers.
The JPMorgan Chase-Bank One merger along with Bank of America's acquisition of Fleet have become the catalysts for a new round of IT footprint consolidation throughout the banking industry, according to Phil Walton, a senior client executive at IBM (Armonk, N.Y.).
Walton works with the top-tier banks in the U.S. as well as with companies that process transactions on their behalf, such as TSYS, First Data and ADP. "They've purchased a whole lot of servers over the past several years from companies like HP, Dell and Sun, and they've got thousands of servers sitting around," he says.
For IBM, the robust market demand combined with turmoil by a major competitor has made for a situation rife with opportunity. "Now is the time for [banks] to make these big spending initiatives," says Walton. "There are a lot of decisions that are being made right now, and these banks want to work with companies that are firm. They don't want to be fuzzy on any of their decision-making."
This week, IBM announced two deals worth over $400 million: a five-year €200 million platform renovation contract with La Caixa (Madrid, €133 million in assets), and a $200 million, 10-year extension of a data-center service contract with SDC, a service provider to Nordic banks.
Meanwhile, HP's CFO and new interim CEO Robert Wayman intend to bolster the profitability of the company's storage and server division. "Storage has been losing market share. We fell a bit behind in terms of the product road map. That's one area [where] we absolutely need to not only fix the mistakes we made but make sure we have the management team and processes [so] that we don't have those kind of mistakes going forward," he said.
With reporting from InformationWeek.