Big Blue to Open New York Design Facility - Brief Article

Brandweek, Sept 13, 1999 by Catharine P. Taylor

IBM is about to enter Silicon Alley. Executives at the technology giant, which is slowly shedding its white button-down shirt image, said last week that they would be opening an interactive services unit in New York by the end of the year. The office, the first outside of a 400-person, 5-year-old facility in Atlanta, will place IBM more aggressively at the center of the interactive services business, where it is becoming more and more of a competitor to specialists such as U.S. Web/CKS, Sapient and iXL.

All of those companies, and a number of others, including Razorfish in New York, have been moving their business models in the direction of providing both front-end and back-end services. Clients that may want interactive design, may also want to have other tasks, from database management to order fulfillment, handled by the same company.

Currently, the unit, known internally as the interactive design studio, works on sites such as Macys.com, the New York Stock Exchange and Univision. IBM is considering giving the unit an official name to reflect its capabilities as a full-service interactive facility.

According to Neil Isford, vice president of e-business services at the Armonk, N.Y-based company, IBM has plans to open other design facilities in other cities in the near future, although he would not identify potential markets for the rollout.

However, company officials stressed that wherever IBM builds an interactive design studio office, it will have the same casual atmosphere as the Atlanta facility which, like many startups, boasts a pool table, at least one dog and an open floor plan. The New York office, which will be spread between two locations at Whitehall Street and Maiden Lane in Lower Manhattan, is being designed along those lines in an effort to draw employees from Generations X and Y. "It is a totally different environment for IBM," Isford said.

Isford claimed he couldn't disclose revenue for the interactive design studio because it is part of IBM's mammoth Global Services division, which accounts for one third of the company's total revenue. IBM's decision to beef up its end-to-end presence comes after a period of self-examination about what its role could be in helping companies get on the Web, or as Isford put it, "Whether we should really focus on the end-to-end, or whether we should focus on the backend."