Column: IBM may crash the Internet party

IBM nearly missed the paradigm shift to client/server but recent developments indicate that it is making a credible run at becoming a seriously Internet-conscious vendor.

IBM nearly missed the paradigm shift to client/server so you wouldn't expect it to emerge as a strong Internet player. But stranger things have happened. In fact, recent developments indicate that IBM is making a credible run at becoming a seriously wired vendor.

For one thing, the integration of legacy systems with the World Wide Web plays to one of IBM's strengths. American Airlines, for example, is taking existing applications that deliver flight schedules and frequent-flier data and putting that data on the Web for customers. The airline is essentially repackaging the information that resides on its System/390s.

Users are discovering that they can leverage their legacy systems and data rather than create stand-alone Web systems. That's good news for IBM, which likes to point out that close to 70% of the world's business content lives on IBM systems.

Furthermore, with the recent announcement of the company's Net.Commerce System, IBM is leading the charge toward the promised land of transaction-based commerce on the Internet.

After watching IBM shake out the electronic commerce offering by selling tickets for the Atlanta Committee for the Olympic Games, mail-order titan LL Bean announced that it will use Net.Commerce System as the backbone for its online shopping service.

IBM's vaunted research operation is also playing a big role in its electronic commerce plans. For instance, the recently announced Cryptolope technology is the result of IBM Research moving to commercialise technology licensed from RSA Data Security. Cryptolope technology secures intellectual content and ensures payment. Big-name companies such as Xerox and America Online are signing up to use Cryptolope to manage copyrighted material on the Web.

IBM Research has other leading-edge technologies in the pipeline, including scalable server technology that can handle more than 1 million hits per hour with no performance degradation. IBM appears to be able to move its research technologies to the market much more rapidly than just a few years ago.

This is definitely a result of CEO Lou Gerstner's demands for short-term results.

Meanwhile, all IBM's middleware has been reworked for the Internet and all its hardware lines have been repositioned as high-availability, high-volume network servers. IBM subsidiary Lotus has announced new versions of everything from Notes to SmartSuite that have built-in Web publishing capabilities. IBM's vertical-industry and consulting units are leveraging technology from the company's research and Internet units to create industry services such as AutoNet. AutoNet allows a prospective car buyer to walk in to a showroom, decide on a car, apply for a loan and get approval in five minutes.

These anecdotes are far from conclusive, and Netscape, Microsoft and AT&T will have big roles to play in electronic commerce, too. But the pattern is emerging: Gerstner's declaration and challenge to all IBM employees to make the company a major player in the world of networked computing seems to be taking hold.

(Sam Albert is an industry analyst and president of Sam Albert Associates in Scarsdale, New York. His Internet address is samalbert@samalbert.com.)

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