Strategy segments action into content and distribution

In the shadow of the largest losses in American corporate history and a subsequent boardroom executive shuffle, IBM has chosen an interesting time in history to reorganize its multimedia operations.

Called Fireworks Partners and based in Somers, NY, the shift in focus centralizes IBM’s efforts within the Personal Systems division of the company. Fireworks is under the direction of Robert Carberry, former assistant general manager of technology in the Personal Systems division, who reports to Personal Systems president James Cannavino. The new division combines IBM’s joint venture and alliance operations with multimedia application and content development.

Sell the blades. In describing the reorganization, Carberry emphasized that IBM had spent a lot of money developing platforms — both hardware and software — including the PS/2 Ultimedia line, the multimedia extension to Presentation Manager under OS/2 and the technology to transmit multimedia data over networks (see Vol. 2, No. 6, for an in-depth look at IBM’s multimedia strategies and technologies).

Now, Carberry says, is the time to see a return on those investments. Platforms, he says, “are the razors, and we want to be in the blade business.” To this end, Fireworks Partners “will provide both the creation and the delivery mechanisms for content.” (See related story on IBM and Blockbuster, p. 9.)

Reporting to Carberry is Mike Braun, formerly assistant general manager of multimedia, for the multimedia solutions development and marketing division, based in Atlanta, GA. Braun is now vice president and managing partner of Fireworks, and will continue to oversee the Kiosk Solutions unit and the Multimedia Publishing Studio.

The Multimedia Publishing Studio, headed by Paul Evans and also based in Atlanta, will expand its efforts to become a “label” for interactive titles. The company will fund the development of titles, develop its own original works, and publish works created by people from outside of IBM.

Beyond Intel and DOS. The Publishing Studio will also begin developing content for platforms other than Intel- or DOS-based machines. (Funny, the press release didn’t mention Windows….) Already it has created a dozen titles for the Sony MMCD player. On the drawing board are titles developed under Kaleida Labs’ ScriptX authoring language for Macintosh and PC, and 3DO titles for the 3DO Interactive Multiplayer. The studio even took exhibit space at Macworld Expo last month to attract Macintosh developers.

“Now is the time that a titles group can be successful” within IBM, according to Evans. In addition to multimedia computer software, the company has also produced films and books, and will continue its efforts in all media. Evans’s group has been best known for producing Columbus: Encounter, Discovery and Beyond and Illuminated Books and Manuscripts.

In addition to the these divisions, Fireworks and Carberry have control over the new business alliances and strategic partnerships in the multimedia arena. These include Kaleida Labs, IBM’s joint venture with Apple Computer to create a cross-platform multimedia authoring environment; newly formed relationships with Bell Atlantic, using IBM technology for video on demand; NBC News, and the NBC Desktop News system to provide news on demand (see Vol. 2, No. 7, p. 25); and the new partnership with Blockbuster Video.

In many respects, Fireworks Partners is designed like a venture capital group, where it will investigate and invest in many different projects, companies and ideas.

Hey, Ricky, where’s Lucie? Until the reorganization, the group responsible for virtually all things multimedia was headed by Lucie Fjeldstad, IBM’s vice president and general manager for multimedia. With hardware and software development, applications and solutions, alliances and new business ventures now reporting to the Personal Systems division, where does that leave her?

IBM maintains that the new division is not a loss of power or prestige for Fjeldstad, who will retain her title. She is on the advisory board of the new company and will continue developing a national broadband digital highway for providing multimedia applications over great distances.

This network would utilize all of today’s transmission systems (including cable television, telephone networks and satellite broadcasting) to deliver entertainment and/or business applications. Carberry says, Fireworks Partners, and the products developed under Fireworks, would “ultimately be customers of Lucie’s.”

Although the new company certainly demonstrates a refinement in IBM’s multimedia strategy, it is also curious that this particular moment in time was chosen for a reorganization of this magnitude. With a new president on the way and the upheaval that such a change will leave in its wake, we expect to see more than fireworks before the dust finally settles at IBM.

David Baron