More India IP Communications Stories

Citing unnamed sources, the Wall Street Journal is reporting today that International Business Machines Corp., or IBM (News - Alert), is laying off “a large number of U.S. employees in its global business services unit.”

 

According to a story here by reporter William Bulkeley, many of those jobs may go to IBM employees in India.

 

“The planned cuts show that even companies that are successfully navigating the global recession are continuing to slash costs – some of them by taking advantage of cheaper Asian labor,” Bulkeley writes.

 

The news comes as IBM is rumored to be in talks to acquire Sun Microsystems Inc. for about $7 billion, in what could be a major consolidation in the server market.

 

The Wall Street Journal broke news of the possible deal last week, citing unnamed sources.

  

The newspaper says the IBM-Sun combination “would bolster IBM’s heft on the Internet, in software and in finance and telecommunications markets.”

 

“The two companies have a common interest in that both make computer systems for corporate customers that aren’t reliant on Microsoft Corp.’s Windows software, and their product lines are less dependant than rivals’ on Intel (News - Alert) Corp.’s microprocessor technologies,” the newspaper reports. “The two companies are also strong supporters of open-source Linux and Java software.”

 

IBM has called for profit growth this year and posted 12 gains in the fourth quarter of last year.

 

“It couldn’t be determined how many people are losing their jobs in the IBM action,” Bulkeley reports. “IBM typically avoids public disclosure of layoffs, and a spokesman declined comment on the plan.”

 

The newspaper says that IBM managers have been receiving training from personnel specialists on handling the layoffs. 

 

According to Bulkeley, IBM’s global business services group is the company’s largest, with 180,000 professionals globally.

  

IBM’s shares rose slightly in afternoon trading on the New York Stock Exchange.