IBM To Work With Chinese Company To Design Servers

Computer giant International Business Machines Corp. (NYSE:IBM) is set to work with China’s biggest server vendor Inspur International Limited (HKG:0596) (OTCMKTS:INPRF). The companies are said to collaborate to design server systems.

IBM to work with Inspur

IBM announced said they would make the DB2 database and Websphere application softwares for Inspur’s K1 server line. It will also make the POWER8 processors as well as support chips for future development.

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Back in 2013, Inspur started aggressively peddling servers to firms owned by China as a way to replace IBM systems. This all comes as business relations between the United States and China, especially with mutual suspicions of cyber-spying. Earlier this summer, shares for Inspur increased right after the company told China news sources it would completely supplant rival.

Serious concerns for cyber security

In the earlier half of this year, Inspur explained in marketing materials a threat of a U.S. based cyber aggression as well as servers and how it all could affect national security. However, neither companies made a mention of cyber security during today’s announcement.

Inspur, which is based in the city of Jinan, has been enjoying a fast growth in the past few years. This is all thanks to the support offered by Chinese government which wants to gain independence in technology.  There has always been concerns involving invasive technology, but last year’s leaks from former U.S. intelligence contractor Edward Snowden magnified these concerns.

It is also these concerns that prompted many Chinese companies to avoid foreign tech companies that deal with sensitive data like Oracle, Cisco, and IBM. The numbers strongly reflect it. IBM’s sales in China dropped last April, however the company also announced partnerships in the recent months which may bolster overall business. Earlier in August, IBM confirmed it would offer risk analysis services for Shanghai Wind Information.