IBM Tweaks the iSeries Line with Improvements

IBM has promised its customers, its resellers, and its employees that it would not make substantial changes to the iSeries server line in 2005, so don’t get worried. IBM is not going to suddenly reconfigure the boxes or their pricing as part of its summer announcements today. But the company is going to nip and tuck here and there to make the iSeries a better fit for customers and partners.

To that end, IBM is announcing new configurations of the i5 520 Value and Express servers, is unveiling a Solution Edition of the i5 520 server, and is simplifying the software pricing on the i5 570. IBM is also changing the way it prices its Software Maintenance (SWMA) service, which is an amalgam of the technical support and software upgrade protection services that is offered to iSeries customers. All of these changes are designed to make the iSeries more competitive and its pricing more rational.

In the current i5 product line, there are two i5 520 servers, which come in Value Editions and Express Editions. The Value Editions are bare bones machines with minimal hardware included in the server’s central electronics complex, while the Express Editions add some memory, disk drives, and other features to the box to make a more usable machine. IBM has been selling one set of i5 520s in the Value and Express categories with 500 CPWs of raw power and 30 CPWs of green-screen computing power and another set with 1,000 CPWs of raw power and 60 CPWs of power for green-screen workloads. All of these servers have a single 1.5 GHz Power5 processor, which IBM is gearing down with its famous governors, and having geared them down, IBM tweaks the pricing accordingly. There is nothing wrong with these machines as they are currently sold, of course, unless you want to run relatively dense Domino or WebSphere workloads. Of course, a single 1.5 GHz Power5 chip has about 2,400 CPWs of raw performance, which is the kind of oomph you need for WebSphere and Domino. So with today’s announcements, IBM is introducing an i5 520 machine with either the Value Edition or Express Edition bundle installed that runs full-out on those kinds of workloads, but which still has the 60 CPW governors on for green-screen workloads.

The i5 520 Express with the 500/30 CPW machine costs $12,000 for the base configuration, and it supports two logical partitions, while the 1,000/60 CPW edition of the machine costs $30,000 with 2 GB of main memory and supports four logical partitions. The new 2,400/60 CPW version of the i5 520 Express costs $42,000 for a base machine with 4 GB of main memory plus two 35 GB, 15K RPM disk drives that are mirrored; it supports the maximum of ten partitions that IBM’s Virtualization Engine hypervisor supports per Power5 processor. A beefier i5 520 Express configuration using the 2,400/60 CPW processor with four of the same 35K disks, a RAID 5 disk controller, and an auxiliary 40 MB write cache card plugged in for data protection costs $48,000. Both of these machines are in the P10 software tier and include i5/OS V5R3 (which has DB2/400 and WebSphere Express bundled in) as well as DB2 Query Manager, Query for iSeries, iSeries Access, and WebSphere Development Studio tossed into the mix.

New, Smaller Solution Edition

The four-core i5 550 server was announced in August 2004, which was also when IBM did another pretty major revamping of the pricing across the i5 line and it also delivered a discounted version of the i5 550 called the Solution Edition. The first of these i5 machines, which give buyers decent discounts if they are using them to run popular third-party OS/400 application software, hit the streets in September 2004, and IBM has been adding software vendors to the Solution Edition fold since then.

But not every OS/400 shop needs an i5 550, which spans from 3,300 to 12,000 CPWs of raw processing power and which costs several hundred thousand dollars as a minimum for a reasonable configuration. So IBM has decided to roll out a Solution Edition based on the formerly top-end 1,000/60 CPW version of the 520 Express box. The initial i5 550 Solution Edition cost $206,000 after a $60,000 price break on the iron from IBM (and the removal of some extra software goodies that are unnecessary for supporting ERP solutions on a four-core box), and customers had to spend a set amount on applications software from a select group of vendors. The amount varies by vendor, but the ante was about $50,000 for the initial application suites offered on the box.

With the i5 520 Solution Edition, customers get an i5/OS license that is based roughly on OS/400 Enterprise Edition, but which does not include some of the extra goodies. The i5 520 Solution Edition has the 5250 Enterprise Enablement feature activated for the one processor in the box, which allows green-screen applications to run full speed. Basically, the box is wide open on any workload customers want to put on there. The base i5 520 Solution Edition costs $39,500 and requires a minimum of $25,000 in spending on software from among the Solution Edition partners (some vendors will require more than this). The i5 520 Solution Edition machine can be converted to a regular i5 520 Enterprise Edition machine for free (but you don’t get the extra software and other goodies), and then it can be upgraded to a two-core box with 6,000 CPWs of raw power when customers run out of gas on the initial Solution Edition.

Last fall, IBM had Solution Edition partnerships with Agilysys, Clear Technologies, Integrated Distribution Solutions, Infor Business Solutions (by virtue of its MAPICS acquisition), International Business Systems, Intentia International, Jack Henry & Associates, Lawson Software, Manhattan Associates, Oracle (by virtue of its J.D. Edwards World software suites that run on the iSeries), Retalix, SAP, and SSA Global. With today’s announcement, CommercialWare, a provider of retail software systems that run on OS/400, is added to the list.

Other Pricing Tweaks

In addition to the new i5 520s, IBM is making a few small changes in the bigger i5 570 systems to make its pricing more consistent with the mixed i5/OS, AIX, and Linux workloads that it is trying to promote on that box in particular.

The i5 570 is comprised of between one and four of the i5 550 chassis that can be lashed together using fiber optic cables and NUMA clustering to present a single system image of up to 16 processors to i5/OS and its applications. Five different i5 570 models exist, each with different price points and characteristics. Specifically, there is a one-to-two core box, a two-to-four core box, a five-to-eight core box, a nine-to-12 core box, and a 13-to-16 core box. Last year, the one-to-two core box and the two-to-four core box core box came with i5/OS activated on a single Power5 processor with either OS/400 Standard Edition (that means no 5250 processing capability) or with OS/400 Enterprise Edition (which means full 5250 processing capability). IBM required that the larger i5 570 machines have at least four i5/OS licenses activated on the box. At $45,000 a pop, this is pretty hefty, especially considering that this represented 12,000 CPWs of green-screen processing power. That’s more 5250 power than most OS/400 shops will ever come close to consuming. You gotta love how efficient green screens are.

One of the unintended consequences of this pricing was to make it very expensive for OS/400 shops who wanted to consolidate lots of AIX or Linux partitions onto an i5 server but who needed only modest amounts of OS/400 power. And so, IBM has normalized OS/400 pricing for the i5 570 such that all base configurations of the i5 570 have i5/OS activated on only one processor. The company has also reduced the pricing on base i5 570 machines for the four largest models by $135,000, which is $45,000 times three. The price change is not retroactive, by the way, so if you bought a big i5 570 and you didn’t really want four i5/OS cores activated, too bad–unless you scream a bit and have some leverage with IBM, of course. Prices to upgrade into the i5 570 line have also been reduced because of this change.

The other interesting change that IBM is making in its announcements today is that it will begin to charge for Software Maintenance tech support and program concurrency on a per-processor basis beginning in September, rather than charging on a per-system basis as it has done historically. The net effect of this is being driven by the same concerns that caused the price change in the i5 570. If IBM wants to have customers consolidate AIX and Linux workloads on the i5, it cannot charge for i5/OS tech support and concurrency for processors that are running these other platforms. And so, IBM has made its pricing make sense.

I will gather the pricing details behind these announcements and bring it all together in a comparative table in the July 18 edition of The Four Hundred. I will also go over some relatively minor but nonetheless interesting announcements that IBM will be making today as well.