IBM in big push to build data centers for clients

By Eric Auchard

SAN FRANCISCO (Reuters) - IBM (IBM.N: Quote, Profile, Research, Stock Buzz) is staking out a major new source of business helping clients like banks or retailers manage data centers on a par with Internet players such as Google or Microsoft, a top official said on Wednesday.

Bill Zeitler, the executive in charge of IBM's hardware business, said the initiative to set up customers with the technology, software and services to operate data centers could rank in significance with IBM's support for Linux in recent years or its push to get businesses on the Internet the 1990s.

IBM has dubbed its new strategy "Blue Cloud."

The name is a play on IBM's corporate nickname "Big Blue" and "cloud computing," the trend by Internet powerhouses to array huge numbers of computers in centralized data centers to deliver Web-based applications to users, rather than making their customers run such programs on their local machines.

IBM, which pioneered centralized data centers decades ago, is looking to arm its customers with technology similar to what it has long offered in the form of hosted services for clients who rely on IBM to operate their data centers for them.

It now wants to help customers build data centers for themselves composed of thousands of low-cost personal computers, equipping them with the data-crunching power of consumer Internet giants Google Inc (GOOG.O: Quote, Profile, Research, Stock Buzz), Microsoft Corp (MSFT.O: Quote, Profile, Research, Stock Buzz), Yahoo Inc (YHOO.O: Quote, Profile, Research, Stock Buzz) and Amazon.com Inc (AMZN.O: Quote, Profile, Research, Stock Buzz).

"I think Google and Amazon are on to something," Zeitler said. "Our particular focus is taking these standards of Internet computing and bringing them to the mainstream in the commercial world."

BIG BUSINESS, BUT HOW BIG?