A Blade Server Guy in an iPod World: What Gives?

A former IBM (NYSE: IBM) executive is going against the company's wishes and joining Apple (Nasdaq: AAPL). Mark Papermaster, previously vice president of IBM's blade server unit, will become head of the iPod and iPhone development team, Apple has confirmed. IBM has already filed a lawsuit to try to stop his hire.

Papermaster is under a one-year non-compete agreement, IBM says, due to his inside knowledge of the company's workings. Litigation is now pending, with IBM promising to take the case to its fullest potential in court.

An Unlikely Match

Apple doesn't appear to be worried -- the iPod-maker has yet to even publicly acknowledge the controversy. The specifics of the positioning may play a role in its confidence. Papermaster will become "senior vice president of devices hardware engineering," which is a notably different focus from his previous path at IBM. The question, then, is why Apple would make such a seemingly strange match -- a blade server expert heading up portable electronic device development.

"You've got a guy that's an expert at blades. That's a unique expertise," Rob Enderle, principal analyst for the Enderle Group, told MacNewsWorld. "It would be really weird to drop him into phones or into small devices," he said.

Long-Term Tactics

It is possible, Enderle pointed out, that the role may be a temporary one for Papermaster. Apple has been working to grow its server business, he said -- in fact, the company acquired a microprocessing design firm just earlier this year -- and its current tactic may be a thoroughly thought-out strategy for its long-term goals.

"My guess is that they really want to get serious about this server business, and they realize they don't have a back end -- which is going to be a serious problem in the Windows 7 timeframe," Enderle suggested.

"I think it's likely this is a holding job -- give him a nice title, give him some shared responsibility, make it look like he is not being acquired for his competitive knowledge. Let the non-compete expire, then move on," he said.

Internal Shift

Papermaster's predecessor, Tony Fadell, isn't going far. The former senior vice president for Apple's iPod division will remain in an "advisory role" to Steve Jobs. His wife, who currently heads up Apple's human resources department, is also reducing her role with the company.

Apple ties the shift with the couple's desire to spend more time with their children.