Reblogged by Keith Dickinson from WALL STREET JOURNAL online:
Apple and IBM are developing more than 100 apps. Pictured, IBM CEO Virginia Rometty and Apple CEO Tim Cook. Paul Sakuma/Apple
Enemies during the early personal-computer wars, Apple Inc. AAPL +1.53% and International Business Machines Corp. said they will cooperate in the mobile era, striking an agreement to create simple-to-use business apps and sell iPhones and iPads to Big Blue’s corporate customers.
The deal underscores Apple’s push to expand the reach of the iPhone and iPad into the business world—beyond their traditional base among consumers. IBM, IBM -0.72%meanwhile, is hoping Apple’s simplicity and popularity will help stem eight consecutive quarters of year-over-year revenue declines, as it moves more of its business software onto the mobile devices used by employees.
A partnership between the two companies would have been unthinkable 30 years ago when Apple famously attacked IBM in an iconic commercial titled “1984,” painting IBM as a big-brother-like figure protecting the status quo while Apple’s Macintosh provided a pathway to freedom.
But both companies have evolved since those days. While Apple still produces Mac computers, its main products are mobile devices. IBM sold its personal-computer business to Lenovo Group in 2005, repositioning the company as a software and computer-services provider.
The two companies said they hope to use the expertise of IBM’s consultants and relationships with corporate customers to create business apps that offer the simplicity—a hallmark of Apple products—of today’s consumer apps. The apps will draw on IBM computing services such as security, device management and big-data analytics.
Under the agreement, IBM’s employees will provide on-site support and service of Apple products inside companies, similar to the AppleCare service that Apple sells to consumers. IBM said it planned to make more than 100,000 employees available to the Apple initiative. It is a rare partnership for Apple, which historically has avoided such alliances.
“This is just the beginning,” said Ms. Rometty, citing a statistic that most smartphones inside companies are used only for email and calendar. She said the companies hope to create new, serious business applications.
The companies said Apple and IBM engineers are together developing more than 100 new apps for various industries. The first batch of apps is expected to be available in the fall when Apple releases the next version of its mobile software, iOS 8.
Historically, Apple has made little effort to sell to businesses. Under Mr. Cook, Apple has started to find success in selling to corporate tech managers. While Apple has made progress in selling to the enterprise, IBM has much deeper ties in that world.
“Apple is not an enterprise company, but that’s not their DNA. It is IBM’s DNA and IBM has had those relationships forever,” said Gartner analyst Van Baker. “It’s an unlikely combination but a very strong one if they can pull it off.”
One challenge for Apple is that not many technology companies have succeeded as both an enterprise and a consumer brand. But as more employees bring their own technology to work, they expect the same ease of use in the office as at home.
According to Forrester Research, global business and governments spent about $11 billion on iPads in 2013—or about one-third of Apple’s total tablet sales. By 2015, Forrester estimates that figure will grow to $13 billion, outpacing the overall rate of spending growth for computers and tablet computers.
Forrester principal analyst Frank Gillett said the tandem of Apple and IBM could spurGoogle Inc. GOOGL -0.20% —whose Android operating system is a rival to Apple’s iOS software—to seek partners in the corporate segment to create a “credible alternative.” Google didn’t respond to a request for comment.
Apple’s stock rose 1.6% in after-hours trading following the announcement. IBM shares were up 1.9% after hours.
Write to Daisuke Wakabayashi at Daisuke.Wakabayashi@wsj.com