Understanding IBM

Part 11. Rope-a-Dope

Muhammed Ali was facing one of his toughest opponents ever. Grizzled and worn from years of boxing, Ali wondered if his best fight would be good enough to keep his championship belt. This opponent had taken him to the limit before, and Ali decided that something special was needed to give him an edge, something that his opponent would not be prepared for and would likely be unable to counter effectively. Ali decided to employ a strategy he called Rope-a-Dope: just wait at the ringside and position himself defensively, wait for his opponent to tire himself out with ineffective blows, and then finish him off.

This strategy of using an opponent's own aggresiveness against him was somewhat effective, though certainly anything from being a crowd-pleaser. Amid boos and jeers, Ali managed to avoid enough serious blows to win the bout and maintain his heavyweight title. Not exactly the prettiest bout in world history, certainly nothing for ringside scholars to provide to their students in the way of form, the tactic nonetheless did the job. Although some would question the sportsmanship of such a strategy, there was nothing in the rules against it, and the title stayed with Ali.

When facing an extremely aggressive opponent, one particularly prone to swing for the knockout punch at every turn, IBM has found the Rope-a-Dope strategy to be surprisingly effective. Instead of engaging Microsoft directly in a bitter head-on battle for software supremacy, IBM has taken a defensive position that relies on its unassailable reputation with major corporations, yet leaves the foundation operating system position firmly in Microsoft's camp. IBM knows that the scoring punches are tallied in the areas of middleware, transaction processing, and secure commerce, so it yields the less lucrative but heavily marketed operating system territory to Microsoft.

Swinging wildly for absolute supremacy on the desktop, Microsoft has begun to show signs of tiring. While distracted by the boos of the crowd, their fighting stance has drawn the ire of the referees at the Department of Justice. While IBM continues to jab with precision at carefully targeted market segments, Microsoft's overaggressive style has caused it to bump heads with an arena full of Java fans and a crowd of worried Netscape supporters. By swinging at anything that moves, Microsoft misses its most important target -- IBM -- and thus scores minimal points in head-on matches. With victory more and more in doubt, Microsoft indeed looks like a bunch of paranoid fools playing to the crowd when Mr. Gates tells an interviewer, "IBM tried to eliminate us! IBM is out to get us!"

Sooner or later, IBM will find that the time to return to the offensive has arrived. The crowd may not be happy with the fighting methods, but they will eventually be satisfied with a victory nonetheless.

Most recent revision: January 23, 1998
Copyright © 1998, Tom Nadeau
All Rights Reserved.

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