ADSTAR

In 1992 IBM's Storage Products businesses comprising eleven sites in eight countries were combined into one division, ADSTAR (ADvanced STorage And Retrieval); The division encompassed all storage products including disk, tape & optical storage systems and storage software; for 1992 it had a gross profit of about $440 million (before taxes and restructuring) on a revenue of $6.11 billion of which $500 million were sales to other manufacturers (OEM sales). To provide additional autonomy thereby further encouraging OEM Sales IBM in April 1993 established ADSTAR as a wholly owned subsidiary with outsider Ed Zschau as Chairman and CEO. To some observers this appeared to be an admission by IBM that the storage subsidiary no longer provided a strategic advantage by providing proprietary devices for its mainframe products. and that it was being positioned to be sold off as a part of then the IBM Chairman John Akers' business strategy. The replacement of Akers by Lou Gerstner in April 1993 changed the strategy from spinout to turnaround, but the disk drive business under Zschau continued to be troubled, declining to $3 billion in 1995. Zschau left Adstar in October 1995, replaced by IBM insider Jim Vanderslice. The Adstar division was dismembered thereafter; the ADSTAR Distributed Storage Manager (ADSM) was renamed Tivoli Storage Manager in 1999 and the disk drive business component was sold off in 2003