Newspaper article THE JOURNAL RECORD

IBM, Apple to Join Forces, Redirect Computer Industry

Newspaper article THE JOURNAL RECORD

IBM, Apple to Join Forces, Redirect Computer Industry

Article excerpt

NEW YORK (AP) _ Former enemies Apple Computer and IBM publicly joined forces Wednesday in a broad pact to swap prized technologies, develop new machines and seize control of the industry's splintered direction.

The agreement marked the most dramatic example yet of cooperation among rival powers in computing. Industry analysts described it as the business equivalent of a U.S.-Soviet friendship treaty for sharing military secrets.

"This is the most unthinkable alliance that became thinkable in a very short time," said Sam Albert, who heads a computer consulting firm in Scarsdale, N.Y. "These two companies have matured to the point where the benefits are easily seen by this alliance."

The pact appears to be part of a broader realization among computer companies that users are rebelling against the industry's hodgepodge of incompatible standards and products.

Some experts said an IBM-Apple collaboration could result in an vastly expanded menu of easy-to-use computers, from laptops to large machines, available to consumers and businesses within a few years.

The arrangement also signaled a profound shift in thinking at International Business Machines Corp. and Apple Computer Inc., which together control nearly half the market for personal computers.

Historically they have detested and poked fun at each other.

"The significance is that the two most important standard-bearers in the personal computer industry have now hooked up and decided there are certain directions the whole industry should go in," said Paul Gillin, executive editor of Computerworld, a trade weekly in Framingham, Mass.

"They've made a big deal about going in different directions and now have decided the competitive situation is desperate enough so they should both lead the industry in the same direction."

Apple, the brash upstart success story born 15 years ago in a Silicon Valley garage, is best known for its user-friendly Macintosh machines that have become a favorite of personal computer users.

The company's loose informal culture contrasts with the starched-shirt correctness at IBM, the world's largest computer maker, which once dismissed Apple as a minor competitive nuisance that sold machines to schools.

Still, when word leaked a few weeks ago that Apple and IBM were negotiating an alliance, many in the industry weren't that surprised, given the anemic state of the industry.

IBM has been aggressively expanding relationships with other computer companies as part of an effort to become more creative, responsive and profitable. The company has announced ventures recently with Wang Laboratories Inc., Lotus Development Corp. and some smaller technology concerns.

Apple, frustrated in its attempt to break into markets dominated by IBM and other big companies with lucrative commercial clients, also has shown willingness to share its technology if that helps increase sales and profits. …

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