In an article on Value Walk, it was reported that Rackspace Hosting has ditched Intel Corporation (NASDAQ:INTC) to join International Business Machines Corp. (NYSE:IBM) OpenPower technology. This would be a major blow to Intel because of the fact that the company is already suffering from its chip business. Intel Corporation (NASDAQ:INTC) has not penetration in the mobile chip industry. Its only hope, the PC business, is declining globally. Intel Corporation (NASDAQ:INTC)’s long terms partners like RackSpace Hosting are now ditching it and International Business Machines Corp. (NYSE:IBM) is taking over the Enterprise space.
International Business Machines Corp. (NYSE:IBM)’s semiconductor technology is being currently used by no less than 80 firms, according to the source. International Business Machines Corp. (NYSE:IBM)’s Open Power technology which is a part of Open Power foundation is imbibing technology giants all across the corporate world. It was developed by International Business Machines Corp. (NYSE:IBM) with a partnership of Google and Nvidia.
The source quoted a director from Rackspace, Aaron Sullivan who said that his company was testing IBM powered servers since 2012. He said that his company noticed a significant increase in the overall performance, response time results from IBM powered servers. He thinks hat Rackspace would deploy thousands International Business Machines Corp. (NYSE:IBM) servers in different areas in the future. This shows that Intel Corporation (NASDAQ:INTC)’s server-side business is on the slump. The company is not able to decide a clear way out of its current crisis.
Intel Corporation (NASDAQ:INTC)’s Xeon servers were regarded as the juggernaut of the enterprise but since the launch of International Business Machines Corp. (NYSE:IBM) Power8-based Power System servers, Xeon popularity is plummeting. Intel Corporation (NASDAQ:INTC) will have to launch optimized server solutions for the ever-changing and dynamic needs of the enterprise.
As of June 30, 2014, Ken Fisher’s Fisher Asset Management owns over 18 million shares in Intel Corporation (NASDAQ:INTC).
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