Speculation Continues on IBM Replacement : Computers: Paul Stern, head of Northern Telecom, is among those considered likely to succeed John Akers.

NEW YORK —  The quest to replace John Akers as head of International Business Machines Corp. has intensified, as some executives have quashed speculation that they are candidates for the job while new candidates have emerged.

Paul Stern, the controversial, no-nonsense chairman and chief executive of Northern Telecom Ltd., is seen as a top contender being considered by IBM’s search panel, industry analysts said.

IBM officials refused to comment on speculation about the selection process to replace Akers, who has said he will step down as chief executive of the world’s largest computer maker.

Officials at Northern Telecom, based in Mississauga, Ontario, did not return telephone calls.

Other candidates said to be on the list include Lawrence Bossidy, chairman and chief executive of Allied-Signal, and Michael Armstrong, a former IBM executive once seen as a potential successor to Akers.

A spokesman for Allied-Signal in Morristown, N.J., said that neither the company nor Bossidy had any comment.

Apple Computer Chairman and Chief Executive John Sculley has also been named as a major contender.

Sculley has been mentioned frequently since the Wall Street Journal reported he recently purchased a house in Greenwich, Conn., which is within commuting distance of IBM headquarters in Armonk, N.Y. But some insiders close to Apple said Sculley is not interested in the IBM job.

“I am 99% sure that Sculley has no interest in that job,” said one executive close to Apple. A company spokeswoman did not return phone calls.

This past week, both Microsoft Corp. Chairman Bill Gates and Xerox Corp. Chairman Paul Allaire issued statements saying they were not interested in the IBM job. The companies said the two men were responding to repeated inquiries.

But Gates does have some advice for Big Blue. In an interview with U.S. News and World Report magazine, Gates said IBM needs to break up into smaller firms in order to get ahead of the pace of change.

“I think IBM will soon be multiple companies,” Gates told the magazine, “and then we can talk about each of the companies independently. I feel sure that until they really split up the sales force, really split into multiple companies, they won’t be able to get ahead of the pace of change . . . ,” Gates said in an interview in this week’s edition, which was released Saturday.

“Some of their businesses, certainly mainframe and even the mini-computer business, won’t be there like they are today in three or four years,” Gates said.

He described IBM as a company “with a lot of incredible assets, chip technology, disk technology, a lot of things they are extremely good at.”

“If you configure the thing the right way,” Gates said, “you’ll be able to have quite a bit of profitability. It would be a very different company than the one we know today.”