New York, N.Y. — Mary Jo Foley reports that IBM Corp. will announce it is moving to a cheaper, more Unix-like Linux mainframe pricing model, on both the hardware and software fronts. Customers aren’t the only likely benefactors. IBM stands to benefit from the move, as do some of the mainframe application software vendors, such as BMC Software, Computer Associates and Candle Corp.
Earlier this year, IBM committed to porting Linux to all of its server platforms, including the venerable S/390 mainframe. Once IBM made its Linux variant available to developers, the download rate surprised even IBM itself, officials claimed. To date, more than 4,000 copies of IBM’s mainframe Linux have been downloaded from IBM’s DeveloperWorks Web site.
But all that still wasn’t enough. IBM is attempting to go a step further by introducing some new, non-mainframe-like pricing for Linux mainframe hardware and software.
While $125,000 per processor engine for Linux mainframe hardware may not sound like much of a bargain to a community accustomed to low-cost – if not free – software, IBM claims it is slashing S/390 prices by a third. At the same time, the company is also moving to a one-time charge for Linux mainframe software – a pricing structure more akin to Unix software models than mainframe ones, where users typically pay a monthly licensing charge based on the capacity of the system upon which the software runs.
At the same time, IBM is introducing the non-mainframe concept of allowing S/390 users to add capacity to their systems, but holding software prices constant, rather than increasing them, as IBM does currently.
“We need to make Linux easier, simpler and cheaper (on mainframes),” said Peter McCaffrey, program director for IBM’s System/390. And if tens of thousands of dollars is still too much for some open-software advocates to stomach for a copy of IBM’s DB/2 database, “the whole collection of open source software and freeware is still available to IBM (Linux) mainframe customers,” McCaffrey acknowledged. “For those who want mission-critical software, they will be willing to pay for it.”
Computer Associates was fairly bullish about IBM’s move. “We still have got to figure out the details. Their Unix model and ours are different,” said Nigel Turner, senior vice president for product management at CA. “But we think it (the change) will have a growing, positive impact. Even more computing will be done on System/390.”
CA last week pre-reported that sluggish mainframe software sales would result in lower-than-expected second quarter earnings. Applications vendor BMC has made similar predictions. Turner denied that the second-quarter mainframe software shortfall was indicative of anything but a temporary aberration. “This isn’t a long-term trend. It doesn’t indicate a slowdown caused by customers wanting to add to their System/390 mix,” Turner said. As a result, he also downplayed the degree of impact that moving to a new pricing model might have on CA’s mainframe software sales over the long term.
But one market analyst characterized the impact of IBM’s Linux mainframe moves as helping to make the mainframe applications market “really viable” for software vendors. “Linux has a different price point than mainframes do – IBM’s move is really something to watch,” said Tracy Corbo, a senior analyst with Hurwitz Consulting in Framingham, Mass. “It’s a great proposition. It’s not for everybody – running Linux on mainframes. But we’re talking about a lot of big and important applications running on these systems. Microsoft still can’t get in there.”
To enable the new pricing, IBM is introducing one new hardware feature and one new software module, both of which will be commercially available starting Sept. 29. The IBM S/390 Integrated Facility for Linux, available for S/390 G5 and G6 servers, will allow users to add processor capacity exclusively for Linux use. The S/390 Virtual Image Facility (VIF) for Linux software, which will run on the IBM S/390 Integrated Facility for Linux, allows S/390 customers to run multiple Linux systems on a single S/390 processor.