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IBM Taps Vietnam for VC/Startup Partnerships

Today, IBM will announce its plans to target Vietnam as a key market for new investments and partnerships with venture capital firms and affiliated startups in Southeast Asia. The hardware/software giant will open a new facility in Vietnam and will start joint research and curriculum programs with local universities.

Specific areas of interest for IBM investment include analytics, clean tech, cloud computing, smart grids, electronic health care, and green data centers. The company’s expansion into Vietnam is a response to what they see as accelerated IT growth in that area.

According to an email from Tod Freeman, global communications manager for IBM’s venture capital group, Vietnam is targeted as a growth center in South Asia and, as such, is “key to IBM’s growth market strategy.

“The country’s IT sector is growing over 20 percent annually, fueled by massive Internet expansion and a younger population that’s driving consumer demand for infrastructure improvements.”

The first IBM Innovation Center in Vietnam is the sixth such site to open since 2007 and the forty-third in the past decade. The center will be based in Ho Chi Minh City and will focus on the development and marketing of new tech across banking, telecom, energy, and government industries. Here, local developers and others will find training and access to open standards-based tech.

The company will also be collaborating with local VCs to support the development of emerging technology products. Similar partnerships now account for nearly a third of IBM’s revenue and have doubled since 2008, when IBM partnered with around 8,500 companies.

IBM is also turning its attention and earmarking funds to develop relationships with the University of Technology in Ho Chi Minh City and the College of Technology in Hanoi. Their goal is to create a curriculum in cloud computing at the former institution and service sciences at the latter. Computing labs and new departments will be created as a result.

IBM is also debuting the first local-language version of developerWorks, its online resource and social network for developers.

As for IBM’s strategy of investment in growth sectors outside the U.S. and Western Europe, Freeman wrote, “The strategy is paying off.

“For example, in Brazil, more than half of the country’s estimated 2,000 independent software vendors (ISVs) have become IBM partners. In China, IBM continues to recruit partners at record rates, with more than 11,000 registered so far this year. In India, IBM has over 2,500 business partners across 200 cities, ranging from small resellers to global systems integrators and ISVs – business partners now drive 35 percent of revenue for IBM in India.”

Certainly, this smacks of global domination; after all, is not IBM the Starbucks of IT? The company’s unrelenting expansion in areas that can least refuse its injections of tech and capital has been making headlines for years. It likely wouldn’t hurt IBM to create dependent tech ecosystems in these areas, and we cannot overlook the fact that IT labor is cheaper in many of these parts of the world.

Some have also begun to question IBM’s role in South Africa, an area that Freeman specifically mentioned as a growth area ripe for strong investments. The company has a rough history there; a U.S. federal court recently ruled that IBM can be held responsible for enabling apartheid by providing regime leaders with IT infrastructure used to disenfranchise and harm black citizens.

When IBM declared its lack of responsibility for how clients would use its products, the judge countered, “That level of willful blindness in the face of crimes in violation of the law of nations cannot defeat an otherwise clear showing of knowledge that the assistance IBM provided would directly and substantially support apartheid.”

IBM is not UNICEF. Historically, like almost any multinational corporation, they have followed profit amorally, whether the revenue streams led to their helping oppress or enlighten the citizens of any geographical area. These partnerships in developing areas are highly profitable for the company. And let us not imagine that their desire to invest in green tech or healthcare-related tech comes from any kind of altruism: These are hot, bankable areas right now.

Still, sometimes capitalism does work for the best for all parties involved. Let’s hope that Vietnamese techies benefit as much from IBM’s expansion into their country as the company itself doubtless will.

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