"International Business Machines Corp. ( NYSE: IBM) was the latest company, American or otherwise, to cut an artificial intelligence (AI) deal. This was a less-than-modest arrangement with Anthropic. It allows business customers access to Anthropic's Claude AI model. The deal will enable IBM software to access an advanced AI tool. Many of IBM's customers are large companies. The deal stands out as less than mediocre when large tech companies and larger AI companies are cutting deals worth tens of billions of dollars."
"The market does not regard IBM as a significant player in the new AI landscape. Its stock is up 36% this year. By contrast, Advanced Micro Devices Inc. ( NASDAQ: AMD) is up 92% because of a partnership with OpenAI. Oracle Corp. ( NYSE: ORCL) shares are up 72% in part due to a $300 billion deal that includes OpenAI to build out infrastructure. IBM is still, and has been for years, too small to matter as a partner. This is reflected in its market cap, which is $270 billion. Oracle is valued at $882 billion, and AMD, which Nvidia dwarfs in the AI chip business, has a market capitalization of $383 billion."
IBM struck an AI deal with Anthropic that gives business customers access to the Claude model and integrates the model into IBM software. The agreement is modest compared with multibillion-dollar partnerships being forged by larger tech and AI companies. Market reaction treats IBM as a marginal player in the AI landscape, with IBM shares up 36% versus larger gains at AMD and Oracle tied to OpenAI collaborations. IBM's market capitalization and recent quarterly revenue and net income are substantially smaller than major competitors. The company missed leadership opportunities across multiple technology waves and lacks scale to play a decisive role in AI's future.
Read at 24/7 Wall St.
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