Do The Math When Looking at IBM i Hosting For Cost Savings

April 5, 2021 Matt Paterini

COVID-19 has accelerated certain business trends that were already gaining strength prior to the start of the pandemic. E-commerce, telehealth, and video conferencing are some of the most obvious examples. One example that may not be as obvious to the general public but has a profound impact on business is the shift in strategy of IBM i infrastructure from traditional, on-premises environments to some form of remote configuration. These remote configurations and all of their variations are broadly referred to in the community as IBM i hosting.

“Hosting” in this context can mean different things to different people, and in general, hosting refers to one of two scenarios. In the first scenario, hosting can refer to a client owned machine that is housed in a co-location facility (commonly called a co-lo for short) where the data center provides traditional system administrator services, relieving the client of administrative and operational responsibilities. In the second scenario, hosting can refer to an MSP owned machine in which partition resources are provided to the client in an on-demand capacity. This scenario allows the client to completely outsource all aspects of Power Systems hardware and the IBM i operating system and database.

The scenario that is best for each business depends on a number of factors and is largely up for debate. In most cases, pursuing hosting purely as a cost saving strategy is a dead end. Furthermore, when you consider all of the costs associated with maintaining and IBM i environment, it is typically not a cost-effective option for the small to midsize market. The most cost-effective approach for these organizations is often a combination of a client owned and maintained system (either on-prem or in a co-lo) with cloud backup and disaster-recovery-as-a-service. Only in some cases of larger enterprise companies can a hosting strategy start to become a potentially cost-effective option.

However, cost savings is just one part of the story. As IBM i expertise becomes scarce and IT resources run tight, the only option for some firms may be to pursue hosting in some capacity. Whatever the driving force for pursing hosting may be, the key point is that it is not just simply an option for running your workload in a different location. There are many details to consider and it is to the best interest of the client to work with an experienced MSP in weighing the benefits and drawbacks of each option. As COVID-19 rolls on, time will tell if IBM i hosting strategies will follow the other strong business trends of the pandemic.

When we say do the math in the title above, it literally means that you need to do the math for your particular scenario. It is not about us doing the math for you, making a case for either staying on premises or for moving to the cloud. There is not one answer, but just different levels of cost to be reckoned which yield different answers. Most IBM i shops have fairly static workloads, at least measured against the larger mix of stuff on the public clouds of the world. How do you measure the value of controlling your own IT fate? That will only be fully recognized at the moment when it is sorely missed the most.

That said, as the IT staffs continue to age at IBM i shops the world over, there may be no option but to move to a public hosting or a public cloud model, and we are being very precise in our language there. Cloud means you can turn it on instantly and turn it off instantly, and you pay for the hours, minutes, or seconds that you use the infrastructure. For a lot of IBM i shops, the difference between hosting and cloud is nil, because they need processing and storage capacity more or less continuously – what is called persistent rather than ephemeral compute and storage capacity out there in the public clouds. And even if they could have application serving compute be ephemeral as workloads rise and fall in the system, the database and storage for applications (both in the database and outside of it in the Integrated File System) will have to be persistent and go very far back in time.

And while we are at it, that IBM i customers run in a hybrid fashion with their core data and their core applications is ridiculous on the face of it. There is much talk about this coming out of IBM these days. But thinking that IBM i shops will split their workloads like that is silly, and everyone who knows IBM i shops knows that. These are all-or-none shops, and they will either move to the cloud with their current application packages in what amounts to a hosting model or not. Some IBM i shops might move to another ERP stack that is hosted if their software can’t make the jump to a more modern release. But they will only do that if, if, if that package can be suitably tailored for their specific business operations.

That’s the dirty little secret about SaaS apps in the cloud: You can’t modify them. So, if there is a feature you need, or a bug, all you can do is tap your feet and wait. The ability to modify code is a key, strategic advantage for the 65 percent of IBM i shops who still create and maintain their own applications. Of the many statistics that we see from survey data, there are many that we do not believe. But the tendency to homegrown applications is one that we know about anecdotally. IBM i shops know that their code is their business, and they are not likely to let go of that control because the opportunity cost of not having it is way too high. This is the same reason that Google and Facebook and Microsoft and Amazon all control their own code on vertically integrated hardware stacks – but they want to convince you that such behavior is not in your best interests so just come use their apps and clouds.

Funny, isn’t it?

Matt Paterini is regional director at UCG Technologies.

This content is sponsored by UCG Technologies – VAULT400.

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