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IBM cuts software, services jobs

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CIOL Bureau
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NEW YORK: IBM, which has made large acquisitions in software and computer services, said on Thursday it had cut as many as 1,000 or so jobs in those areas.



The world's largest computer hardware, services and software company cut less than one-half a percentage point of jobs from the software and services divisions in the United States, IBM spokesman James Sciales said.



The cuts are likely to be related to its purchase of PriceWaterhouseCoopers Consulting last year and of Rational Software earlier this month, said John Jones, an analyst at SoundView Technology.

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The company took on 30,000 employees with PwC Consulting and indicated it planned to trim from its ranks, he said. In addition, he said he believed that with Rational's 950 additional software sales people, IBM needs to cut from those ranks.

The cuts aren't an attempt by IBM to cut costs to meet financial targets, Joyce said. "These are very well orchestrated plans that are part of the two acquisitions."





Armonk, New York-based IBM has more than 180,000 employees in its computer services division and about 35,000 employees in software, putting the upper end of the job cut estimate at 1,075 positions. IBM's total employee count is about 320,000.



The company cut more than 15,000 jobs in 2002 as part of an effort to reduce costs amid weaker demand for technology. It also transferred more than 10,000 employees to Hitachi when it sold most of its hard disk drive business to that company.



"We're always identifying the skills that we don't need and finding the people who have the skills that we do need," Sciales said.

Employees have 30 days to find another position within the company.



IBM shares fell 12 cents, or 0.16 percent, to $77.28 on the New York Stock Exchange while the broader American Stock Exchange Computer Hardware Index <.HWI> rose 1.67 percent.

© Reuters

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