IBM has extended its now widespread discounting policy to include services in bid to win more integration and facilities management contracts, according to Computer Systems News. Companies like Andersen Consulting and Electronic Data Systems Corp have been able to offer price benefits when bidding against IBM, because of the alliances they have forged with product manfacturers, but that advantage could be offset if IBM is prepared to discount services. Other commentators are concerned that a driscounting policy will undermine the value of professional services and that customers will view services as a free add-on to hardware contracts. The US trade weekly quotes a computer services analyst who claims that IBM is offering discounts based on the amount of business, and comments that this could act as an incentive to buy not only hardware, but to award maintenance and facilities management as well. A spokesman from the Gartner Group was also quoted, and he believes that IBM formerly operated an enterprise discount when companies spent over $50m, but that that has been cut to around $20m. IBM refused to comment on suggestions that it is operating a discount policy, but other sources told Computer Systems News that special pricing has to be approved by a review committee which ensures that margins are maintained and antitrust laws are not breached. Nevertheless eyebrows have been raised at prices IBM has been prepared to accept in many parts of its business, notably the IBM Credit Corp leasing arm, and some worry that it is laying up trouble for the future.
