IBM SEEKS GROWTH WITH NEW CONSUMER DIVISION
By Adnews Staff
While IBM is still the biggest computer company in the world, it is lagging in the part of the market growing most quickly, the consumer side. This week the U.S.-based corporation announced it is taking action to remedy this situation, starting up a worldwide consumer division headed by a former top Ameritech Corp. executive. The new division will take over development and marketing of the Aptiva line which is currently in the personal computer division. IBM stumbled with this popular model, launched last fall, when it badly underestimated demand during the important Christmas selling season and left retailers short of stock. The consumer division will also have multimedia software, as well as on-line services - information and entertainment to which home computer users gain access with a modem. IBM chairman Louis Gerstner Jr. told financial analysts last week that his company's research indicates global consumer spending on computer products and services will rise from $54 billion(US) in 1993 to $116 billion in 1998.
To head the new consumer division, IBM has hired James Firestone away from his job as head of the consumer division of Ameritech, the Chicago-based Bell company. Before coming to Ameritech, Firestone was head of the American Express traveler's check group. At one point during his time at American Express, he worked under Gerstener who has brought a number of former Amex executives over to IBM since taking charge of the computer giant two years ago.