US Government May Not Approve Sale of IBM PC Unit

andy1307 writes "Xinhua, among others, quotes a Bloomberg report saying the Committee on Foreign Investments in the United States, or CFIUS, might block the sale of IBM's PC unit to Lenovo over national security concerns. CFIUS is made up of 11 U.S. agencies, including the Department of Justice, the Department of Homeland Security, and is chaired by the Treasury Department. They are concerned Lenovo employees might be used to conduct industrial espionage. The Bloomberg story said members of CFIUS were focusing their attention on an IBM facility in North Carolina of the United States. The same article says IBM hasn't produced its own PCs for several years and that the bulk of its production is done by manufacturing partners, largely in China. In the past, CFIUS has blocked the sale of Global crossing to Hutchison Whampoa because it would have meant Chinese control of the undersea cable communication network."

Re:The facility in North Carolina is really strang

[Anonymous Coward]

It's where they send misbehaving employees. I've been there and it's really not so bad. Lots of free drinks and rah rah team building exercises. It's kind of the last chance stop before they boot you out of the company.

One of the outings during the 2 week "education" training was a trip to see the Tarheels play. Not being a big fan, I sat it out back in the dormitory. Unfortunately, that showed my "lack of team spirit" and counted against me in my final evaluation.

I don't work for Blue anymore, but back in the late 70's it was a pretty great place to be.

Re:Laissez-Faire?

[TheKidWho]

Wrong, the American people are the largest buyers of American Debt, not the chinese government.

Why IBM need to sell

[Ev0lution]

Bad news for IBM if it's blocked, because if you look at the full year report* it's clear why they're so keen to get rid of it.

Personal Systems Group made $162 million off turnover of nearly $13 billion, that's a 1.2% margin. Software group made $4.5 billion from a $15 billion turnover. Hell, WebSphere MQ Series made several times the profit of the whole PC business, and that's a team of maybe 200 people. CICS made even more. From IBM's point of view, Personal Systems Group isn't worth the effort or the risk.

*http://www.ibm.com/investor/financials/quarterly/ 4q04earnings.phtml [ibm.com]

Re:Hidden Agenda ?

[B747SP]

The real story is that the government has millions of IBMs bought in the past two years that are now just so much scrap due to lack of support.

With respect, those millions of IBM PCs were scrap the moment they left the factory.

Every time I say something bad about IBM PCs on slashdot, an IBM employee with mod points mods me down as a Troll. I don't understand why, but hey, I'll try again...

I'm responsible for a fleet of around 100 personal computers - some desktops, most laptops. In years past, there was a corporate rule that said "Must Buy IBM" (they gave us a 'free' teaching lab worth of computers, we sold out, something, something)... So a significant magority of that fleet of computers are IBM PCs. P3-500, P3-650 and early P4 desktops, and a lot of 600E, 600X, and T21 laptops.

All of the IBM equipment, without exception, has failed at three years of age, plus or minus two months. The desktops have two failure modes: either the power supply just dies, or the brittle plastic bracket that holds the power switch inside the case breaks and falls off. You can generally jury-rig a solution for the brittle plastic, but the power supplys are made from unobtanium - exactly the physical opposite of an otherwise identical power supply that Gateway and many others used - and so you simply can't replace a power supply short of paying IBM prices for spares.

The 600 series stinkpads have a single failure mode: The battery charging circuit fails at precisely three years of age. If that damned blinking orange "I'm not working" light doesn't drive you mad, the fact that your laptop is now a desktop will!

The T21 laptops have two failure modes: either someone farts in the general direction of the grossly under-engineered screens and they either break, or just go a terrible pink colour, -or- the mini-PCI slot fails, and you lose modem and ethernet. Motherboard replacement.

Now these failures aren't one or two machines. These are all machines. They all fail that way.

Now you can't tell me that these failures aren't in the product by design.

By comparison, I have old P1, P2, and P3 gateway and Dell machines lying around everywhere, and those damn things just won't die!!!! I still have one old P1-60 gateway box with about 120Mb RAM in it running FreeBSD, MySQL, Apache and stuff, and with an uptime of about 2 years. It won't go away!!!

Nah man, this IBM stuff... it has the technical potential to be good stuff, but whilever they keep designing that shit to fail at three years of age, I'll not ever buy it.

Re:Hidden Agenda ?

[af_robot]

Now these failures aren't one or two machines. These are all machines. They all fail that way.

Well, I don't believe you. We have an IBM service center in our company I can judge personally how many failures were caused by IBM's "bad design".
IBM PCs had only ONE critical problem - leaking capacitors on desktop motherboards, but it is not IBM fault - many vendors also had that problem.

btw: In some cases IBM service centers can repair your failed PC's under ECA even if it is out of a warranty. Leaked capacitors usually fixed under ECA.

Uh..lots

[Renegrade]

> Btw: How many "laptop problems" did you have with ThinkPads?!

Oh, I dunno.. it destroyed $300 batteries regularly, it had too many IRQs for all devices to be enabled at once, it had this ugly little cli--er, eraser thingy in the middle of the keyboard which was useless and required adjustment every few days, the BIOS setup looked like some 1983 CGA game for retarded five year olds, and was about as useful, it was twice the size and half the power as the equivalent Toshiba model of the time... Oh yah, and the drivers which when downloaded, had to be extracted onto a _floppy_ disk.

IBM Thinkpad 600E U2426. All the crap you never wanted, and then some. (Oh yah, the model number is obtuse and there are a trillion useless variants to this useless heap of garbage)

I should have bought that Compaq instead. It was the same price, and still runs to this day.

Oh well. At least IBM still offers downloads on legacy products like that, even if they are really stupid to install and highly broken.

The 'highly broken' part is a universal standard for the PC industry anyways though, which IBM created with that crappy machine they threw together in a drunken binge on a weekend in 1981 -- Unsharable interrupts? Static OS structures? Segmented, 20-bit memory? Processor-driven I/O? How could you do this with a motto of "Think"?? Or maybe that's a typo, maybe it's.. DRINK??

Remember kids, alcohol, like smoking, is _not cool_.

Re:#2?

[scapermoya]

China isn't gunning for our spot as the military superpower, they are gunning for our spot as the economic one. They have 1.3 billion people, with the right organization their GNP will outstrip that of the US in the next 50-75 years, easily.

Re:Long Term cost of devaluation

[Artemis]

US debt is considered 0-risk financially because there is no risk premium paid on US debt in the international market. It's a financial term, not an English one.