Can Ibm Keep Lotus Blooming?

When IBM bought Lotus Development Corp., it placed a fat bet on networking. The computer maker spent $3.5 billion and is expected to pay hundreds of millions more for the cost of goodwill over the next three years. This big pile of chips is mainly riding on Notes, a $300 million-a-year business and the leader in "groupware," because it's the future. It can become, says IBM Chief Executive Louis V. Gerstner Jr., the glue to link workers, partners, and customers in virtual corporations--perhaps making it more important than any underlying Microsoft Corp. operating system. Says Morgan Stanley & Co. analyst Steven M. Milunovich: "Losing to Windows 95 isn't so important if Notes wins."

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