IBM i Wins Software Pricing Throwdown Versus AIX-DB2 Combo

August 6, 2012 Timothy Prickett Morgan

The advent of the PowerLinux machines back in April, which have discounted Linux and PowerVM hypervisor software and substantially discounted memory and disk storage prices compared to the plain vanilla Power Systems machines in which they are based, got me to thinking about software pricing. And that, as we all know, is a dangerous thing. And it turns out, compared to AIX and DB2 for Unix shops, customers using entry Power Systems-IBM i machines are, at least at list prices, getting quite a deal.

Shhhh. Don’t tell IBM.

No one was more surprised than me to figure this out. Because Oracle is the dominant database supplier in the Unix racket and therefore the main competitor to the DB2 for i database at least as far as Big Blue is concerned, whenever I do IBM i versus Unix system comparisons, I tend to put an Oracle 11g database on the box. Oracle’s Standard Edition One database for two-socket servers is very aggressively priced, in fact priced so low as to take on Microsoft‘s SQL Server. And 11g Standard Edition is considerably less expensive than the top-end 11g Enterprise Edition. There’s very tiered pricing, and Oracle is competing at all the price points.

IBM has many different editions of its DB2 database for Unix, Windows, and Linux servers. Some are aimed at developers (DB2 Express and DB2 Express-C) and others at lightweight jobs with limited processor and memory scalability (DB2 Workgroup Server Edition), the main one that IBM peddles for online transaction processor work on midrange and enterprise boxes is Enterprise Server Edition. And if you want to be able to skin Oracle or Sybase databases and use some other cool features, you go with Advanced Enterprise Server Edition.

On IBM i 7.1, you of course get an integrated database management system, which most of us call DB2 for i, which has been embedded in the operating system from the AS/400 launch back in 1988 and which, you will remember, was not only the database management system for RPG and COBOL applications but which was also the file system for storing objects like pictures and other kinds of media files and indeed any kind of file on the original AS/400. (This was the right idea, but there just wasn’t enough oomph in a processor or I/O subsystem to keep doing it this way when the client/server revolution tool off in the early 1990s.)

As a thought experiment during the summer silly season, I decided to rip apart IBM i, AIX, and DB2 Enterprise Edition pricing to see how they compared to each other on the same Power Systems iron. As it turns out, running AIX 7.1 Enterprise Edition plus DB2 9.8 Enterprise Edition on a power machine is considerably more expensive on low-end machines than IBM i 7.1 with its integrated database management system. And on larger machines, the premium that you pay for IBM i over the AIX plus DB2 is nominal–at least for the basic operating system and database.

Some words of caution. The way IBM prices IBM i is considerably different from the way AIX and DB2 are priced. It is not a perfectly apples-to-oranges comparison because the database is bundled with IBM i. On P05 and P10 machines in the Power Systems lineup, IBM i has a per-core license fee plus a $250 per user charge on top of that at list price, with even lower fees on Solution Edition configurations sold in conjunction with third-party application providers. Larger machines in the P20 through P60 tiers have much higher per-core licensing fees, but come with an unlimited number of users. The entry machines include unlimited 5250 processing capacity, but the midrange and high-end machines do not. You have to pay extra for that. If you want to have an unlimited number of users on an entry IBM i 7.1 system, you pay $18,750 in the P05 tier (which is equivalent to 75 users) and you pay $50,000 on the P10 tier (which is equivalent to 200 users). In the examples I put together, I reckoned software prices on a per-core basis, so on a four-core Power 720 in the P05 IBM i tier, I only allocated one quarter of that $18,750 to each core to get all operating systems at the unlimited user level. But it is possible that some customers might need to have unlimited users smacking against one or two cores. In that case, the per core price of IBM i will be much higher. I made the best case and most likely scenario and assumed that customers would want to allocate IBM i across all four cores.

AIX, like IBM i, is sold on a per core basis, but it comes in three different editions–Express, Standard, and Enterprise–and comes in three different sizes–small, medium, and large. I put all of the pricing for all nine different possibilities into the monster table I created for the IBM i versus DB2 comparison, and I also put in the per core charges for one year’s worth of Software Maintenance (SWMA) on the Unix variant from IBM.

DB2 9.8 Enterprise Edition is sold using IBM’s Processor Value Unit (PVU) software pricing scheme, which assigns a relative performance for the X86, Itanium, Power, or Sparc processors running various IBM middleware and systems software. On the Power7-based Power Systems rack and tower machines that are in the current lineup, two-socket machines have processors that are given a PVU rating of 70, those with four-sockets have a rating of 100, and those with more than four sockets are rated at 120. The irony is that the idea behind the PVU scheme was to get away from tiered pricing within a system family and base pricing on relative performance, which this scheme really doesn’t do since in many cases, a Power 720 can have the same processor running at the same speed as the high-end Power box, but the bigger box has a software cost that will be 71.4 percent higher.

For IBM i, I did my best to extract the cost of the underlying operating system from the DB2 for i database, which you can do by subtracting a license for Application Server, the variant of IBM i that does not include the right to use the database and that is intended to be used as an application server, from the overall IBM i license cost. I pulled out the cost of Software Maintenance for Application Server and for DB2 for i from their license costs, and I also went so far as extrapolate what portion of a P05 and P10 machine was coming from Application Server and what was coming from DB2 for i. The P05 license comes with 90 days of support, which I pulled out and then slapped on a full year’s support. After adding in the unlimited user licenses, what I was left on a per core basis was license and support costs for both IBM i 7.1 Application Server and DB2 for i 7.1 database server. And just for fun, I divided these costs by the PVU ratings from Software Group to come up with a PVU price that could be reckoned against DB2 Enterprise Edition for Unix platforms.

I need to go over a few things. First, I have been hunting around and have discovered new pricing for IBM i. The base license cost per core for a license including SWMA has not changed since it was set many years ago with i5/OS V5 and carried through with IBM i 6.1. But what has changed is the cost of one year of SWMA after that initial license runs out. The P05 charge used to be $1,200, now it is $1,300; P10 used to be $3,000, now it is $3,500; P20 used to be $4,000, now it is $4,600; and P30 through P60 used to be $6,000 and now it is $7,000. The net effect of this is that supporting IBM i is more expensive, but the initial license fee for IBM i is actually lower.

Second, on a P20 IBM i machine, an IBM i license with SWMA costs $44,000, compared to $59,000 on tiers P30 through P60, but Application Server nonetheless costs $9,000 on this machine as it does on machines in the P30 through P60 tiers. You would expect Application Server to cost $6,820 on the P20 box, given the lower overall license and SWMA cost.

Third, SWMA on AIX, regardless of the edition, is a lot lower–often half the cost–on a Power7-based machine than on an older Power5 through Power6+ box. In this case, since I am comparing Power7 machines, it makes no difference, but it is important for you to know that IBM has sweetened the pot for customers upgrading to AIX 7.1 while at the same time putting a squirt of lemon in the IBM i 7.1 pot.

Fourth, I cannot find the SWMA cost beyond the first year for DB2 on Unix, and have assumed it is 20 percent of the combined cost of the DB2 license. This is consistent with what I have seen in IBM’s TPC-C and TPC-H benchmarks.

Stacking Them Up

The results of this little pricing experiment are very interesting. Here’s how the PVU prices stack up for the operating systems and the databases together across six different Power Systems machines:

What is not so easy to see, and what you can read all about in that monster table, is that on a Power 720 machine crimped at four cores–the box that most IBM i shops buy these days–IBM i with its integrated database is one-quarter the cost of the AIX-DB2 combination with both bits at the Enterprise Edition level. I don’t know about you, but I would have never guessed that in a million years, and it just goes to show you once again that you have to do the math. The hardware costs for the Power 720 machine are identical.

What is going on here with the four-core Power 720 is that the Application Server portion of the IBM i platform costs twice as much as the AIX operating system does (again, if you allocate the underlying operating system and database portions of the IBM i license consistent with the P30 through P50 tiers that have Application Server as an option), the SWMA is basically the same for the base operating systems, but DB2 for i on a per-core basis comes to about $5,600, or $97 per PVU with a year of SWMA tossed in, compared to $438 per PVU, or $30,660 per core, for DB2 9.8 Enterprise Edition.

On a P10 machine, which has a much higher IBM i license fee of $14,995 per core, that is still a lot less the $31,648 it takes to slap AIX 7.1 EE and DB2 9.8 EE on the same core with a year of maintenance. The DB2 for i database license works out to be around $260 per PVU including that year of maintenance instead of the $438 IBM is charging for DB2 9.8 EE on a Power 720-class box. When you add in all the effects of the operating system and maintenance for the operating systems and the databases, the AIX stack is 47 percent more expensive than the IBM i stack.

I was all prepared to jump up and down about how much more expensive Application Server is compared to AIX. That’s why I started doing research for this story in the first place. But for the entry P05 and P10 machines at least, it doesn’t matter because DB2 for i is so much less expensive than DB2 EE.

Here’s what happens when you actually price up machines running IBM i Application Server and AIX EE and put on their respective DB2 databases:

In these configurations, all of the machines except the Power 720s are at half their maximum core count activations for the physical box. On the Power 750, the AIX setup is 3.5 percent more expensive, and on the larger machines, the IBM machine is 8.6 percent more expensive on the Power 770 and 5.7 percent more expensive on the Power 780 and Power 795.

As you well know, these comparisons use IBM list prices, and in a competitive deal, the list price goes out the window and the big red pen comes in from Big Blue to do some price cutting. I do not get the impression from the resellers and customers that I talk to that IBM does much in the way of discounting when it comes to Power Systems running IBM i. Unless you bring Hewlett-Packard, Oracle, or Dell in on the deal, of course, peddling Windows, Linux, or Unix alternatives.

But IBM knows as well as you do that in many cases you simply do not have the funds, time, or will to port your apps, and that IBM i is your only option. If IBM is eager to sell AIX machines, it is positively frothing at the mouth wanting to get DB2 customers. What this probably means is that on the street, the AIX-DB2 combo is anywhere from a little bit less expensive to considerably less expensive than IBM i for Power 750 and larger machines where IBM is doing a competitive takeout. Existing AIX shops running DB2 are just not going to get the same level of discounting unless it is in their contract that they have to get the same best deals the best customers get (like the U.S. Federal government does). I cannot imagine that IBM sells very many Power 720s running AIX and DB2, not at these prices, which is why it has been so hot to trot lately with the PowerLinux machines, with their cheaper peripherals and slightly less expensive Red Hat Enterprise Linux 6 licenses.

The situation is, of course, a little different if you have a Power 720 machine with lots of users but only one core activated running IBM i, with the other cores running Linux or AIX workloads. In that case, with unlimited users, the P05 machine costs $300 per PVU for the IBM i stack, compared to $113 if you allocated those users across four cores in the machine. That’s still less than $452 per PVU it cost to put on the AIX-DB2 combo at the Enterprise Edition level–33.6 percent less, to be precise. On a P10 machine with unlimited users of IBM i on one core, it is a lot more expensive: $928.50 per PVU, in fact. So basically, to break even with the AIX-DB2 pricing, you need to put IBM i on three cores and activate unlimited users. That puts the cost of IBM i at $452 per PVU–the same as the AIX-DB2 tag team.

Of course, the real tests are how IBM i stacks up against Oracle running atop AIX on Power iron and SQL Server running atop Windows on x86 iron. I am trying to get a handle on the new Windows Server 2012 and SQL Server 2012 pricing so I can make some intelligent comments. All of the pricing details are not out yet for the new Windows, which will launch in September and I told you about a few weeks ago.