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September 29, 1998

IBM SETS NEW MAINFRAME MIDDLEWARE TAXES

By CBR Staff Writer

IBM Corp duly re-jigged middleware pricing on its S/390 mainframes yesterday to make the hosting of new applications such as Domino, SAP and Oracle attractive and to end the practice of ‘shamplexing’ whereby users have purchased Sysplex coupling facilities to qualify for Parallel Sysplex License Charging (PSLC) discounts of up to 30%, but haven’t shared workloads between nodes in the mainframe as IBM requires (CI No 3,502). IBM made it clear back in May when it adopted the new usage-based pricing and added a level C price band to PSLC that the grace period for ‘shamplex’ users would end yesterday. News that the two models will replace its Graduated Monthly License Charge (GMLC) and eight other price tiers means that within 18 months there will be no other price model for users to revert to. Users are to be charged strictly according to the number of MSUs (millions of service units) a piece of software uses. The models require the latest OS/390 version 2 release and pricing applies to DB2, CISC, IMS and MQSeries plus four associated products. PSLC charges are now grouped in three bands. Steep A band charges up to 250 MIPS, band B incremental prices that are 60% lower than band A up to 1000 MIPS, and band C charges that are 25% lower incrementally than band B when using the latest versions of some 80 middleware products. Meantime, IBM hopes that usage-based pricing will make non-Sysplex S/390s a reasonable option as a consolidation platform and for new applications. It says a new usage-based program means customers installing Domino, SAP, Oracle Applications, PeopleSoft, IBM Intelligent Miner, BaanERP or Net.commerce on a dedicated S/390 will be offered IBM middleware pricing terms that are up to 75% cheaper versus capacity-based pricing. Many mainframe users have applications running on Unix and NT servers that they would consider migrating to the mainframe. But under GMLC, it was cost-prohibitive. The software might require only a couple of MIPS but would be charged according to the size of the whole mainframe. Key to how important the changes are depend upon whether key OS/390 ISVs adopt the same pricing metrics. Only Candle Corp from the posse of ISVs that Big Blue had on parade, could offer a concrete example of what pricing changes it would make, offering to support IBM’s campaign to attract ERP users with its Command Center and DB2 system management products, claiming the latter will be up to 40% cheaper than on a system measured by capacity usage compared with IBM’s 75%. The new usage and PSLC band C charges apply from January 1. IBM didn’t offer any specific pricing details beyond offering that software pricing for G5 mainframes is averaging $200 per month per MIPS of performance. S/390 general manager Dave Carlucci said IBM is committed to doubling mainframe performance every two years. He said G5 offers a 2.3x performance over G4 in 14 months.

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