IBM Chops High-End Power CPU And Memory Prices

November 4, 2013 Timothy Prickett Morgan

The fourth quarter is well under way and everyone now knows that Power8 systems are not going to start rolling out until the middle of 2014 or so. And this means IBM has to do some wheeling and dealing, particularly at the high-end where the Power7-based Power 795 machines are looking a little long in the tooth. This is because IBM did not provide a Power7+ bump at the high end of the Power Systems line in late 2012 or early 2013, and it has no plans to, either.

IBM generally does not provide a “plus” bump to its high-end Power Systems machines because the multichip modules that come out with the original chips in any generation are already running at the rated top speed for the chip. These high end customers don’t want to do upgrades every 18 months and 36 months suits their needs a little better. They would rather scale up the performance in the box by activating more cores than swapping out processors through an upgrade to slightly faster chips. You don’t touch a big bad box that is running the business unless you really have to.

So, in announcement letter 313-096 to get existing Power 795 customers to spend a little dough, IBM is cutting prices on both processor activations and memory activations for the Power 795. Here’s what the price cuts look like:

Machine	Feature		Old	New	Percent
Type	Number	Description	Price	Price	Change
Power 795
9119	4713	Power7 Core Activation	$10,950	$8,100	-26.0%
9119	4717	64 Power7 Core Activations	$700,800	$518,400	-26.0%
9119	8212	1 GB Memory Activation	$245	$185	-24.5%
9119	8213	100 GB Memory Activation	$24,500	$18,500	-24.5%

The 26 percent price cut is only available on the Feature 4700 processor, which runs at 4 GHz; the activation code for a core on that chip is Feature 4713. You can buy them in groups of 64 core activations and these also have a 26 percent price cut. Although, when you think about it, you will get even more off the top of that if you are cranking up 64 cores at the same time because there is no way there is not a volume discount on top of this price change. IBM is also chopping the prices on memory activations for the Power 795 machine by 24.5 percent. It now costs $185 per GB to turn memory on in the system.

That announcement letter also outlines lowered upgrade prices from other machines into the Power 795 as well as lower conversion costs between features in the Power 770 and Power 780 machines, as outlined here:

From		To
Machine	From	Machine	To	Old	New	Percent
Type	Feature	Type	Feature	Price	Price	Change
Power 795
9119	4754	9119	4713	$6,023	$4,455	-26.0%
9119	4755	9119	4713	$6,023	$4,455	-26.0%
9119	5680	9119	8212	$221	$167	-24.4%
9119	5681	9119	8213	$18,228	$13,764	-24.5%
9119	5684	9119	8213	$22,050	$16,650	-24.5%
Power 770
9117	5648	9117	EU09	$2,320	$1,200	-48.3%
9117	4495	9117	EM40	$495	$440	-11.1%
9117	4496	9117	EM40	$495	$440	-11.1%
9117	4497	9117	EM40	$495	$440	-11.1%
9117	4499	9117	EM40	$495	$440	-11.1%
9117	5693	9117	EM40	$495	$440	-11.1%
9117	5694	9117	EM40	$495	$440	-11.1%
9117	5695	9117	EM40	$495	$440	-11.1%
9117	7892	9117	EM40	$495	$440	-11.1%
9117	7893	9117	EM40	$495	$440	-11.1%
9117	7894	9117	EM40	$495	$440	-11.1%
9117	4495	9117	EM41	$990	$880	-11.1%
9117	4496	9117	EM41	$990	$880	-11.1%
9117	4497	9117	EM41	$990	$880	-11.1%
9117	4498	9117	EM41	$990	$880	-11.1%
9117	4499	9117	EM41	$990	$880	-11.1%
9117	5690	9117	EM41	$990	$880	-11.1%
9117	5693	9117	EM41	$990	$880	-11.1%
9117	5694	9117	EM41	$990	$880	-11.1%
9117	5695	9117	EM41	$990	$880	-11.1%
9117	5696	9117	EM41	$990	$880	-11.1%
9117	7892	9117	EM41	$990	$880	-11.1%
9117	7893	9117	EM41	$990	$880	-11.1%
9117	7894	9117	EM41	$990	$880	-11.1%
9117	4496	9117	EM42	$1,980	$1,760	-11.1%
9117	4497	9117	EM42	$1,980	$1,760	-11.1%
9117	4498	9117	EM42	$1,980	$1,760	-11.1%
9117	4499	9117	EM42	$1,980	$1,760	-11.1%
9117	5690	9117	EM42	$1,980	$1,760	-11.1%
9117	5695	9117	EM42	$1,980	$1,760	-11.1%
9117	5696	9117	EM42	$1,980	$1,760	-11.1%
9117	5680	9117	EMA2	$167	$148	-11.4%
9117	7272	9117	EMA2	$148	$111	-25.0%
9117	7273	9117	EMA2	$111	$37	-66.7%
9117	7274	9117	EMA2	$37	$0	-100.0%
9117	7663	9117	EMA2	$167	$148	-11.4%
9117	5681	9117	EMA3	$13,764	$9,028	-34.4%
9117	5684	9117	EMA3	$16,650	$14,800	-11.1%
9117	1845	9117	EC53	$900	$300	-66.7%
9117	5620	9117	EPM0	$9,388	$7,085	-24.5%
9117	5621	9117	EPM0	$9,388	$7,085	-24.5%
9117	5622	9117	EPM0	$9,388	$7,085	-24.5%
9117	7380	9117	EPM0	$9,388	$7,085	-24.5%
9117	7387	9117	EPM0	$9,388	$7,085	-24.5%
9117	7388	9117	EPM0	$9,388	$7,085	-24.5%
9117	7540	9117	EPM0	$9,388	$7,085	-24.5%
9117	5403	9117	EPMA	$3,130	$2,362	-24.5%
9117	5670	9117	EPMA	$3,130	$2,362	-24.5%
9117	5671	9117	EPMA	$3,130	$2,362	-24.5%
9117	5672	9117	EPMA	$3,130	$2,362	-24.5%
9117	7306	9117	EPMA	$3,130	$2,362	-24.5%
9117	7700	9117	EPMA	$3,130	$2,362	-24.5%
9117	7719	9117	EPMA	$3,130	$2,362	-24.5%
9117	5626	9117	EB85	$8,400	$3,600	-57.1%
9117	5683	9117	EB85	$8,400	$3,600	-57.1%
9117	5627	9117	EB86	$8,400	$3,600	-57.1%
9117	5664	9117	EU09	$2,320	$1,200	-48.3%
9117	4980	9117	EPM0	$12,399	$7,971	-35.7%
9117	4981	9117	EPM0	$12,399	$7,971	-35.7%
9117	4980	9117	EPM1	$11,710	$7,863	-32.9%
9117	4981	9117	EPM1	$11,710	$7,863	-32.9%
9117	5459	9117	EPMA	$4,134	$2,658	-35.7%
9117	5468	9117	EPMA	$4,134	$2,658	-35.7%
9117	5459	9117	EPMB	$2,926	$1,965	-32.8%
9117	5468	9117	EPMB	$2,926	$1,965	-32.8%
9117	5659	9117	EB85	$8,400	$3,600	-57.1%
9117	5669	9117	EB86	$8,400	$3,600	-57.1%
9117	EU05	9117	EU09	$2,320	$1,200	-48.3%
9117	3712	9117	3716	$2,500	$1,500	-40.0%
9117	3713	9117	3717	$5,000	$3,000	-40.0%
9117	3714	9117	3718	$7,000	$3,600	-48.6%
9117	4983	9117	EPM0	$11,513	$9,034	-21.5%
9117	4984	9117	EPM0	$11,513	$9,034	-21.5%
9117	4983	9117	EPM1	$10,874	$9,117	-16.2%
9117	4984	9117	EPM1	$10,874	$9,117	-16.2%
9117	5329	9117	EPMA	$3,839	$3,012	-21.5%
9117	5334	9117	EPMA	$3,839	$3,012	-21.5%
9117	5329	9117	EPMB	$2,717	$2,278	-16.2%
9117	5334	9117	EPMB	$2,717	$2,278	-16.2%
9117	5585	9117	EB85	$8,400	$3,600	-57.1%
9117	5586	9117	EB86	$8,400	$3,600	-57.1%
9117	5648	9179	EU09	$2,320	$1,200	-48.3%
9117	4495	9179	EM40	$495	$440	-11.1%
9117	4496	9179	EM40	$495	$440	-11.1%
9117	4497	9179	EM40	$495	$440	-11.1%
9117	4499	9179	EM40	$495	$440	-11.1%
9117	5693	9179	EM40	$495	$440	-11.1%
9117	5694	9179	EM40	$495	$440	-11.1%
9117	5695	9179	EM40	$495	$440	-11.1%
9117	7892	9179	EM40	$495	$440	-11.1%
9117	7893	9179	EM40	$495	$440	-11.1%
9117	7894	9179	EM40	$495	$440	-11.1%
9117	4495	9179	EM41	$990	$880	-11.1%
9117	4496	9179	EM41	$990	$880	-11.1%
9117	4497	9179	EM41	$990	$880	-11.1%
9117	4498	9179	EM41	$990	$880	-11.1%
9117	4499	9179	EM41	$990	$880	-11.1%
9117	5690	9179	EM41	$990	$880	-11.1%
9117	5693	9179	EM41	$990	$880	-11.1%
9117	5694	9179	EM41	$990	$880	-11.1%
9117	5695	9179	EM41	$990	$880	-11.1%
9117	5696	9179	EM41	$990	$880	-11.1%
9117	7892	9179	EM41	$990	$880	-11.1%
9117	7893	9179	EM41	$990	$880	-11.1%
9117	7894	9179	EM41	$990	$880	-11.1%
9117	4496	9179	EM42	$1,980	$1,760	-11.1%
9117	4497	9179	EM42	$1,980	$1,760	-11.1%
9117	4498	9179	EM42	$1,980	$1,760	-11.1%
9117	4499	9179	EM42	$1,980	$1,760	-11.1%
9117	5690	9179	EM42	$1,980	$1,760	-11.1%
9117	5695	9179	EM42	$1,980	$1,760	-11.1%
9117	5696	9179	EM42	$1,980	$1,760	-11.1%
9117	5680	9179	EMA2	$167	$148	-11.4%
9117	7272	9179	EMA2	$148	$111	-25.0%
9117	7273	9179	EMA2	$111	$37	-66.7%
9117	7274	9179	EMA2	$37	$0	-100.0%
9117	7663	9179	EMA2	$167	$148	-11.4%
9117	5681	9179	EMA3	$13,764	$9,028	-34.4%
9117	5684	9179	EMA3	$16,650	$14,800	-11.1%
9117	1845	9179	EC53	$900	$300	-66.7%
9117	5620	9179	EPH0	$29,477	$16,685	-43.4%
9117	5621	9179	EPH0	$29,477	$16,685	-43.4%
9117	5622	9179	EPH0	$29,477	$16,685	-43.4%
9117	7380	9179	EPH0	$29,477	$16,685	-43.4%
9117	7387	9179	EPH0	$29,477	$16,685	-43.4%
9117	7388	9179	EPH0	$29,477	$16,685	-43.4%
9117	7540	9179	EPH0	$29,477	$16,685	-43.4%
9117	5620	9179	EPH2	$41,275	$23,363	-43.4%
9117	5621	9179	EPH2	$41,275	$23,363	-43.4%
9117	5622	9179	EPH2	$41,275	$23,363	-43.4%
9117	7380	9179	EPH2	$41,275	$23,363	-43.4%
9117	7387	9179	EPH2	$41,275	$23,363	-43.4%
9117	7388	9179	EPH2	$41,275	$23,363	-43.4%
9117	7540	9179	EPH2	$41,275	$23,363	-43.4%
9117	5403	9179	EPHA	$4,299	$2,434	-43.4%
9117	5670	9179	EPHA	$4,299	$2,434	-43.4%
9117	5671	9179	EPHA	$4,299	$2,434	-43.4%
9117	5672	9179	EPHA	$4,299	$2,434	-43.4%
9117	7306	9179	EPHA	$4,299	$2,434	-43.4%
9117	7700	9179	EPHA	$4,299	$2,434	-43.4%
9117	7719	9179	EPHA	$4,299	$2,434	-43.4%
9117	5403	9179	EPHC	$3,009	$1,703	-43.4%
9117	5670	9179	EPHC	$3,009	$1,703	-43.4%
9117	5671	9179	EPHC	$3,009	$1,703	-43.4%
9117	5672	9179	EPHC	$3,009	$1,703	-43.4%
9117	7306	9179	EPHC	$3,009	$1,703	-43.4%
9117	7700	9179	EPHC	$3,009	$1,703	-43.4%
9117	7719	9179	EPHC	$3,009	$1,703	-43.4%
9117	5626	9179	EB95	$8,400	$3,600	-57.1%
9117	5683	9179	EB95	$8,400	$3,600	-57.1%
9117	5627	9179	EB96	$8,400	$3,600	-57.1%
Power 780
9179	5664	9179	EU09	$2,320	$1,200	-48.3%
9179	4982	9179	EPH0	$33,370	$21,134	-36.7%
9179	4982	9179	EPH2	$42,832	$32,708	-23.6%
9179	5469	9179	EPHA	$4,867	$3,083	-36.7%
9179	5469	9179	EPHC	$3,123	$2,385	-23.6%
9179	5597	9179	EB95	$8,400	$3,600	-57.1%
9179	5598	9179	EB96	$8,400	$3,600	-57.1%
9179	EU05	9179	EU09	$2,320	$1,200	-48.3%
9179	3712	9179	3716	$2,500	$1,500	-40.0%
9179	3713	9179	3717	$5,000	$3,000	-40.0%
9179	3714	9179	3718	$7,000	$3,600	-48.6%
9179	5003	9179	EPH0	$33,370	$22,247	-33.3%
9179	EP24	9179	EPH0	$33,370	$22,247	-33.3%
9179	5003	9179	EPH2	$42,832	$34,266	-20.0%
9179	EP24	9179	EPH2	$42,832	$34,266	-20.0%
9179	5339	9179	EPHA	$4,867	$3,245	-33.3%
9179	EP25	9179	EPHA	$4,867	$3,245	-33.3%
9179	5339	9179	EPHC	$3,123	$2,498	-20.0%
9179	EP25	9179	EPHC	$3,123	$2,498	-20.0%
9179	5595	9179	EB95	$8,400	$3,600	-57.1%
9179	5596	9179	EB96	$8,400	$3,600	-57.1%

The price changes actually took place on October 7, the same week as the big Power Systems announcements. But the IBM announcement system is fluky, and so am I some days, and we both missed each other. Which is why I am telling you about it now. If you have done a deal in the past month on this iron, IBM will no doubt make good on the discounts.