Blockchain Cuts Shell Its Former Self

Blockchain Cuts Shell Its Former Self

blockchain cuts shell its former self

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“There really won’t be a blockchain team anymore,” said a person familiar with the situation.

IBM has reduced its blockchain team to almost nothing, according to four people familiar with the situation. 

Job losses at IBM (NYSE: IBM) intensified as the company missed its revenue targets for the once-90% celebrated technology this year, according to one of the sources.

“IBM is undergoing a major reorganization,” said a startup source who has been interviewing former IBM blockchain employees. “There really won’t be a blockchain team anymore. Most of the blockchain people at IBM have left.” 

IBM’s blockchain unit missed its revenue targets by a wide margin for two years in a row, a second source said. The expectations for enterprise blockchain were too high, they said, adding that IBM “didn’t really manage to execute, despite making a lot of announcements.”

An IBM spokesperson denied the claims. 

“Our blockchain business is doing well, thank you,” Holli Haswell, IBM’s director of public relations, said by email. “We have realigned some leaders and business units to continue driving growth, we do that every year.”

However, a former IBM staffer who had been working on enterprise blockchain said there has been a succession of “Resource Actions” or RA, which basically means firing people based on business performance rather than personal performance. 

“I would wager that less than 10% [of the blockchain product and engineering team] is still working on IBM Blockchain,” the ex-IBM source said. “There have been tons of shakeups. Virtually all have left. IBM is now 100% focused on hybrid cloud, so anything that doesn’t support that doesn’t get priority.” 

IBM has pumped a lot of money into blockchain since 2016, when it started talking about the technology’s potential to transform the way industries do business.

If IBM’s blockchain innovation work is now limited to some R&D, and doesn’t even extend to consulting, as one of the sources said, this sounds like an ominous note for the chain space. enterprise blockchain in general, perhaps particularly for the Hyperledger blockchain collection, for which IBM was a key contributor. 

In its recent full-year earnings statement, IBM as a whole reported that revenue fell 6% on an annualized basis. Looking back at its 2017 financial statement, IBM called itself a “blockchain leader for enterprises.” All mention of the technology is now absent from the company’s statements.

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In recent years, IBM has pushed ahead with a number of blockchain networks built on the Hyperledger Fabric. Big Blue’s main blockchain networks are FoodTrust, a Walmart-backed farm-to-grocery tracking system; and TradeLens, a Maersk-backed shipping container logistics blockchain. IBM also added the Trust Your Supplier network and previously tested payments through World Wire.

While cryptocurrencies and public blockchain networks seem to have flourished in 2020, the economic impact of COVID-19 has affected innovation departments within large companies, to the point that areas that have been covered have been cut back. they do not generate income immediately, like the blockchain. 

Another source, an enterprise blockchain engineer with previous ties to IBM, estimated that more than 100 blockchain-related jobs at Big Blue have been cut over the past year. 

The source also noted that Jerry Cuomo, IBM’s head of blockchain and an evangelist for the technology since 2016, has moved on and is now working on artificial intelligence.

“In fact, Jerry is overseeing additional strategic, high-growth parts of IBM’s business, but he is still involved in blockchain,” Haswell, the company spokesperson, said. “He’s a senior technical leader and that’s what we do at IBM: expand the roles of people.”

Following the publication of this article, Haswell further disputed the report, adding:

“IBM maintains a strong blockchain-dedicated team across the company. We have shifted some resources, but remain committed to the technology, blockchain ecosystem, and services. We see blockchain as a driver for our cloud business.”

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