New York, N.Y. — IBM chairman and CEO Louis Gerstner said that the Internet should lead to more outsourcing by companies as a way to increase business, but not at the expense of personal privacy.
Speaking at the eBusiness Conference and Expo in New York, Gerstner said Internet taxation and protection of intellectual property are important topics, but consumers remain concerned about keeping their information private.
“Through our policies and practices, industry has to send an unambiguous message that tells people: ‘You can trust us. You have choices. They will be respected. And you’ll know in advance how any information you give us will be used,” Gerstner said.
The issue of privacy, and using the information properly, could have the effect of stifling further business growth on the Internet, if it’s not used properly, he said
He said thousands of consumers routinely give made-up information on Web sites because they’re fearful of how it could be used, or misused.
“I have to agree that privacy is an issue for many folks,” said Jay Stevens, senior vice president at Buckingham Research Group. “Anything that makes people feel more comfortable is valuable and important.”
Just two weeks ago, IBM named its first “privacy czar,” Harriet P. Pearson, and Gerstner urged other companies to do the same.
Gerstner said IBM is looking at more outsourcing as a commercial tool of the Internet economy. He said the company will spend $4 billion in the next three years on developing e-sourcing tools.
“We know today that an increasing number of customers are going to buy information technology as a utility-like service over the net,” he said.
Companies, he said, are going to want bundled services like hosting, infrastructure integration and more, from one source. IBM, he said, will build 50 more data centers to meet those needs.
Gerstner also stressed a growing dependence on the Linux operating system by corporate users. He said IBM will invest nearly $1 billion in its Linux operations.
“We’re convinced that Linux can do for business applications what the Internet did for networking and communication,” he said.
Gerstner also said IBM will build the “world’s largest” Linux supercomputer for Royal Dutch Shell. The Netherlands-based oil producer will use the Linux system to analyze seismic data and identify oil reservoirs.
“The fact that is a sale to Shell, which is a commercial customer … shows that Linux is starting to move into the mainstream,” said Irving Wladawsky-Berger, IBM’s server group vice president of technology and strategy.