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IT giant IBM plans to open more solution centers and increase its headcount on the mainland in the coming years as part of its global transition from hardware manufacturer to information technology service provider.

"We will continue to scale up the number and size of solution centers on the mainland," said Dominic Tong, general manager of IBM's China business.

At present, IBM has five centers and 3,000 staff on the mainland.

The centers are significant because they provide a platform to cultivate mainland IT talents, Tong said. But he refused to disclose how many centers the firm plans to add.

Tong said IBM wants to organize more tours for Hong Kong and mainland IT companies this year, to facilitate investment in each other's markets.

"We regularly organize the so-called China Innovation Tour for companies to visit our research and solution centers on the mainland, which could gear them up to ride on the mainland economic boom."

IBM said it is also helping its mainland partners to go global.

"Many mainland enterprises plan to extend their businesses overseas, and we can use our networks to assist them in setting up branches in overseas markets such as Hong Kong," said Tong.

The move is believed to be part of IBM's efforts to shift from being a manufacturer to a service provider, analysts said.

IBM has sold out or spun off most of its low-end manufacturing units in recent years, and is now focusing on providing IT solution services to clients.

On its cooperation with China's largest computer maker Lenovo, Victor Fung, the company's global technology services executive, said: "IBM has gradually handed over our personal computer and low-end technology businesses to Lenovo in recent years."

"In the future, we will mainly concentrate on technical support and consultancy services, but IBM still relies heavily on Lenovo's network to expand its turf in the market," Fung added.

Lenovo purchased IBM's loss-making personal computer assets for US$1.25 billion in 2004.

IBM got a stake of nearly 19 percent in Lenovo as part of the deal. The company is selling 3.5 percent of its Lenovo shares for HK$3.2 to HK$3.3 per share for HK$990 million.

Analysts said the move had come at the right time, as Lenovo's Hong Kong-traded shares soared last week after it announced its best quarterly results since the IBM deal.

(China Daily February 8, 2007)