IBM now wants to enter Tier II cities with a bouquet of hardware, software and services offerings, primarily targeted at mid-market clients. It has decided to enter cities like Raipur, Bhopal, Bhubhaneshwar, Vizag and Nagpur to pursue its mid-market strategy along with its channel partners. It has planned hub and spoke model by making Tier II cities as the hub for Tier III cities. Noteworthy is its initiatives to launch IBM Express Remote Managed Infrastructure Services (ERMIS) and to provide Scalable Modular Server Rooms (SMSR) to these cities.
Our Views: This news definitely points towards two things :
1. The growth rates and margins pressures of its business in metros and
2. Market’s and company’s readiness in terms of infrastructure and mindset of Tier II cities to accept the technology.
While the first might be making the company to look for newer horizons, the second one would be a challenge that they would have to face in pursuing their agenda forward. Lets wait to see the outcome!!