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IBM Shows That Collaborations With the NSA Are a Company’s Death Knell

Posted in Asia, IBM, Servers at 5:22 pm by Dr. Roy Schestowitz

Summary: China refuses to buy from IBM because of its “special relationship” with the NSA and shortly thereafter China takes over IBM’s server business

IBM recently reported a sharp decline in sales, blaming this on a slump/collapse of contracts with China after the NSA leaks. Perhaps realising that trust is impossible to regain now, IBM, which does not exactly support software freedom on its servers [1], is selling its server business — just like the desktop business — to China [2-4]. It shows the ongoing decline of IBM, which added NSA-oriented extensions such as TPM to Linux-centric agenda. IBM claims to be “hardening the Linux server” these days [5], but historically its agenda inside Linux has been even more dubious than Red Hat's or Intel's because it pushed into Linux (the kernel) software patents agenda and artificial limitations, as we have demonstrated here for years. Linux is used extensively for server security [6], but when Linux itself becomes less secure, then we have a real issue in our hands. Air France now turns to HP [7] — not IBM — for its private server farm needs. Knowing that Boeing is the benefactor of industrial espionage (aided by US diplomats and the NSA), Air France would be wise to dodge IBM. HP has back doors too, but suffice to say, this is less obvious than IBM’s publicly-advertised NSA collusion.

“For many years now IBM has been outsourcing its workforce to India and China and now it’s actually selling parts of its business to the East.”Techrights has historically been friendly towards IBM but also highly critical of the company's patent agenda (lobbying for software patents), marketing tactics, and promotion of freedom- and privacy-infringing technology. The impact of the NSA on IBM is not at doubt [8], and it’s far from negligible [9,10]. For many years now IBM has been outsourcing its workforce to India and China and now it’s actually selling parts of its business to the East. Can clever people in the West (perhaps former IBM workers) outdo IBM by providing a freedom-respecting stack and consulting services around GNU/Linux and Free software? The term FUD comes from IBM, as IBM used these tactics to demonise a former employee who had gone independent with IBM expertise.

At this stage, despite deceiving marketing, IBM needs GNU/Linux and Free software more than GNU/Linux and FOSS need IBM. Recently, the President of the Open Source Initiative (OSI) called IBM a patent troll. IBM can carry on openwashing its business with OpenStack [11,12], Hadoop [13] and so on (even OpenOffice.org), but until it stops serving the NSA, the software patents agenda and various other conflicting interests (causes that harm software freedom and GNU/Linux) we are better off nurturing “true” (as in completely) Free software companies.

Going a few months back (as we mentioned at the time), we have reports such as:

IBM found black budget from the military/surveillance industrial complex too intoxicating to refuse. It sure it alluring to many companies and IBM is no exception; in the 1930 IBM famously did business with the Nazis, helping Hitler’s party profile people (before the data was used for imprisonment and genocide).

For those who did not know about the IBM/NSA relationship, here is a quick wakeup call. It’s not news. It was made known even in the NSA’s Web site. IBM boasted about it. To quote the page about TAPO:

What the Trusted Foundries have to offer:

Accreditation of Trusted Suppliers, with the list available at the DMEA website http://www.dmea.osd.mil/trustedic.html. Potential customers should engage directly with the listed suppliers (except IBM) for all services.
Through TAPO, a contractual relationship with IBM to produce leading-edge microelectronics parts in a trusted environment. IBM maintains world-class facilities in both Vermont and New York, providing a broad range of capabilities to the government in support of the Trusted Foundry contract.

Who can use TAPO services?
Any government-sponsored program can use TAPO to access the IBM Trusted Foundry:

DoD Sponsored Programs may qualify for subsidized pricing on specific MPW runs, provided funding is available.
Other government agencies will need to provide full funding for access.
Contractors working on IR&D projects may access the foundry provided they have a government sponsor.

What services are available?
Through industry partnership at IBM, TAPO offers:

Foundry Services including Multi Project Wafer runs, dedicated prototypes, and production in both high- and low-volume models.
Intellectual Property (IP) development, including standard prepurchased IP.
Packaging and test services.
Custom Logic Service: Cu-08, Cu-65HP, Cu-45HP, and Cu-32.

Foundry Services:
TAPO offers several production options in the foundry business area depending on the schedule and the quantity desired. Designs up to the secret level are accepted.

Multi Project Wafer (MPW) Prototyping – MPW prototype runs have multiple designs on a single reticle and are targeted to customers in need of low volume with no production quantities.
Dedicated Prototype is a dedicated single design prototype run that includes the mask build. IBM guarantees a minimum of two wafers will be delivered to the customer.
Production phase produces unlimited chip quantities, following a successful prototype phase.

Custom Logic Services:
TAPO now has a contract in place for IBM’s commercial Custom Logic flow on digital chips. The customer provides a netlist of RTL hand off and IBM will do the physical layout, package, design, and GDSII generation, and provides tested packaged parts. Design submissions are accepted in Cu-08 Cu-65HP, Cu-45HP, and Cu-32. IBM’s Custom Logic methodology is also available for classified designs.

Intellectual Property:
TAPO has bought pre-paid access to certain roadmap IP that it makes available to customers on an as-needed basis. A complete list of available IP can be obtained from TAPO. IP orders can also be placed for existing IBM IP, custom IP, and certain non-IBM IP.

No company should brag about working with above-the-law spies who engage in industrial espionage, lists for assassination, political coups, etc. IBM’s affairs with the NSA are not new; what’s news is public disapproval (even inside the US) of the NSA and its actions.

Related/contextual items from the news:

  1. IBM Stays Committed to the Cloud, But What of OpenStack?

    While there have been questions about IBM’s true commitment to the OpenStack cloud computing platform, the company definitely remains focused on cloud computing. Today IBM announced plans to commit more than $1.2 billion to significantly expand its global cloud footprint. The investment includes a network of cloud centers that clients can apparently leverage, including allowing businesses to run their IT operations in the cloud.

  2. Lenovo Confirms Purchase Of IBM x86 Server Business For £1.4 billion
  3. Lenovo Agrees to Buy IBM Server Business for $2.3 Billion
  4. IBM Sells Server Business to Lenovo for $2.3 Billion
  5. Hardening the Linux server
  6. A10 Networks Debuts Thunder DDoS Hardware

    ACOS is a Linux-based networking operating system.

  7. Air France builds private cloud with HP for Linux server farm

    Air France says it has automated and increased the reliability of its 1,500 Linux servers by deploying a private cloud solution.

    The deployment is based on HP’s Cloud Service Automation (CSA) software to accelerate deployment times for physical and virtual infrastructures.

  8. IBM’s Full Year Revenues Hit by NSA Scandal
  9. IBM Earnings – Don’t Expect Big Blue to Get Out of Its Slump
  10. IBM: At Least 10% Downside To Fair Value
  11. IBM Explains Its Participation on the OpenStack Foundation Board of Directors

    Todd Moore, director, IBM Standards and Partnerships, discusses his participation as a member of the OpenStack board of directors.

  12. IBM Optimizes OpenStack Cloud Performance with Scheduler

    In a nod to the need for more efficient resource management for public and private cloud computing, IBM (IBM) has unveiled a new product for its OpenStack platforms. Called the Platform Resource Scheduler, the resource provides a virtualized programmable interface for automating the allocation of cloud resources.

  13. IBM’s Watson Fails To Compute In A World Of Open-Source Hadoop

    IBM has big plans for Watson, but its proprietary, developer-free approach is under-delivering.

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A Single Comment

  1. Needs Sunlight said,

    January 27, 2014 at 5:13 am


    IBM didn’t sell off its server business, just the x86 crap which is on the way out anyway. Wintel is past peak. IBM is now investing in its Power architecture and it looks like they may be expecting that to pick up the slack. So far they put in around $1 billion for Linux and Power, presumably GNU/Linux. Last time they did that, they got the investment back within the year.

    However, that said, with the NSA taint, they will have a much harder time selling outside the US.

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