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IBM to sink $3bn into chip research

Big Blue scrambles to innovate amid slumping hardware sales

IBM to sink $3bn into chip research

IBM yesterday announced plans to invest $3bn over the next five years in chip R&D, aiming to reverse the downward momentum in its hardware business, Reuters reported.

The company's hardware sales fell 23%, year on year, in the first quarter, leading to its lowest quarterly revenues in five years. Next week the tech giant will report Q2 earnings.

The chip research will concentrate on finding production methods for increasing chip density. Other areas to be explored are new materials for chip-making, such as carbon nanotubes, which are more stable than silicon and are also heat resistant and can provide faster connections.

"The message to our investors is that we are committed to this space; we believe there is great innovation possible that will be necessary in world of big data analytics," said Tom Rosamilia, senior vice president of IBM's Systems and Technology Group.

"These are essential ingredients in delivering the kind of performance the world will demand. The world is demanding it now and will continue to demand it for the next 10 years."

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