International Business Machines Corp. (NYSE:IBM) Signing Off Deals with Chinese Firms to Provide Cloud Based Security Analysis

On August 7, 2014, International Business Machines Corp. (NYSE:IBM) announced that it would provide cloud based security and risk analysis to one of its clients in China. The analysis deal that International Business Machines Corp. (NYSE:IBM) made with the financial data company of China can enhance the company’s future business in the respective country. It is important to note here that Chinese enterprises, especially the State-owned ones, are increasingly turning away from foreign technology due to the security concerns.

The new software model of IBM will allow Shanghai Wind Information to send data to the IBM’s cloud without having to install the software or disclose its portfolio. The company can send away any of the publicly available information on the IBM server, without having to worry about the installation and portfolio.

The risk analytic of International Business Machines Corp. (NYSE:IBM), Andrew Aziz, while talking to the press, said that IBM does not receive any of its clients’ information through this software, which makes this deployment software one of a kind.

Andrew further commented that IBM respects the local laws of the countries where it operates, and since there are a number of data privacy rules and laws in the country of China, the company has introduced this new model.

U.S. technology companies have been facing many problems in China, mainly due to the security concerns of native companies, especially after Edward Snowden blew the whistle on the spy activities of United States’ National Security Agency.

The Chinese government is encouraging its enterprises to turn away from foreign hardware and software companies in order to improve the national security. The government, during the earlier part of the year, also ordered the State Banks to pull out from their deals with International Business Machines Corp. (NYSE:IBM).

International Business Machines Corp. (NYSE:IBM) was especially targeted, for its servers play a sensitive and significant role in almost all the major sectors of the industry, from energy to banking.

The company’s executives are avoiding discussing IBM’s deal with the Chinese company; however, they have shown enthusiasm towards their new software and they believe that the company will succeed in the near future due to its secure deployment software.

International Business Machines Corp. (NYSE:IBM) reported a decrease of 20 percent in its Chinese region’s sales during the first quarter of the year. However, the company has signed up a number of partnership deals with a number of Chinese companies, which suggests that IBM’s future in the respective country remains positive. The company, in July, announced that it will start a technical training program in almost 100 Chinese universities and will donate around $100 million for a major data software agreement that it has signed with the Chinese Education Ministry.

International Business Machines Corp. (NYSE:IBM), on the last trade day, August 7, opened its stocks at a price of $186.64 and closed at a price of $184.30, after hitting the highest figures of $186.68. The company has a total market capitalization of 183.86 billion with a price to earnings ratio of 11.66.