IBM $34-billion bet can help it catch up with Amazon and Microsoft

IBM has outlined a strategy to use Red Hat, a provider of cloud computing tools, to get a big piece of the cloud computing market.

IBM has tried multiple ways to stay relevant in the technology world. But it has often been outgunned by rivals like Amazon and Microsoft.

On Tuesday, IBM outlined its latest strategy: using its $34 billion purchase of Red Hat, the largest ever acquisition of a business software company, to get a big piece of the lucrative cloud computing market.

The deal is a high-stakes bet for IBM and its leader, Ginni Rometty. Amazon and Microsoft dominate the cloud computing industry, with Google a distant third.