IBM is reportedly considering selling its Watson Health business unit, many US media claim Big Blue is considering the sale as part of CEO Arvind Krishna's plan to focus on higher margin businesses like AI (in areas other than healthcare) and the cloud.
In IBM's fourth quarter, revenue from cognitive applications, which includes Watson Health, amounted to $ 1.5 billion, down 2% from the previous year.
Last October, IBM announced plans to split its unit from infrastructure service managed in a new company This is another IBM initiative to focus on its hybrid cloud business, which includes Red Hat, its most recentente acquisition in the matter. When the new company is operational, IBM will change from a company where half of its revenue comes from services to a company where more than 50% of its revenue comes from recurring revenue.
Doctors reluctant to use artificial intelligence
IBM Watson was there One of IBM's "strategic imperatives " under the leadership of former CEO Ginni Rometty, despite its slow growth and reports that the system was expensive and difficult for customers to implement.
When IBM launched its unit Watson Health , the goal was to expand into personalized medicine through DNA translation and the introduction of electronic medical records.But Watson has stumbled into the healthcare industry, writes Wall Street Journal , "partly because doctors were reluctant to embrace artificial intelligence ". In 2018, IBM laid off staff from its Watson Health unit.
Regarding the potential sale, the WSJ suggests that IBM consider "a sale to a VC or industry player or a merger ".