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I have the dubious honor of being what some people may refer to as a mainframe pricing expert. In one fashion or another, I have supported or developed mainframe software pricing programs to support various generations of IBM hardware over the last twenty-five years.
Mainframe software pricing is one area that has lagged behind the many innovative improvements that we have seen on the mainframe. How can this be true when the mainframe is touted as being the best price/performance technology on the planet? Has the performance of mainframe hardware improved to the point that it offsets any deficiencies in software pricing models? Have we reached a point where the majority of software expenditures on the mainframe are for ongoing maintenance? If you are in maintenance mode, who is monitoring the cost and effectiveness of your software stack? Here are a few things that are holding back innovation in mainframe software pricing:
I see innovation and new mainframe workloads driving major changes in mainframe software pricing models. Have you noticed how the specialty engines continue to increase in popularity? New workloads are being created on the specialty engines, and that reduces the processing power needed for the traditional engines. It is not uncommon to see a customer upgrade to a new machine with the same or fewer traditional MSUs while adding 2-3 IFLs for new Linux workloads. The pricing on the specialty engines will become more sophisticated as vendors play catch-up to the technology. Initially, the specialty engine model has been to price on a per-engine or full-capacity basis.
When it comes to mainframe software pricing, there is no single silver bullet. However, a good start is to make sure that you develop a relationship with a prospective vendor as the first step. If the relationship works, doing business can be totally transparent and you will receive an excellent return on your mainframe investment. If a vendor doesn’t have a clear understanding of your business and what you are attempting to accomplish, it is virtually impossible for them to position solutions for moving your business forward.
Do you have an interesting pricing experience to share?
Best Regards,
Jon
Topics: Executive Suite
While I was reading the business section of my local newspaper (The Columbus [Ohio] Dispatch) and enjoying my morning coffee, the following article (March 21, 2013) caught my eye: “IT contract expected to save $150M in five years.” The only thing more intriguing than the title of the article was the opening paragraph:
The state of Ohio’s IT mainframe currently takes up four floors and 350,000 square feet of space, and worse, it’s inefficient. So the Department of Administrative Services expects a $267 million contract with IBM will save tax payers millions in return.
Please respond to the next portion of the article:
“When thinking about better operation of state government, we think about areas like these,” said Beth Gianforcaro, a spokeswoman for the information-technology department. “IT tends to be the most expensive of operations.”In fact, the state spent $830M in fiscal year 2012 to run its mainframe, which includes 5,000 servers that are each running at about 6 to 8 percent capacity.
Gianforcaro said that’s inefficient, and one of the state’s goal is to compile [sic] its 19 e‑mail systems into one that everyone could use.
That’s where IBM is supposed to help: getting the state’s servers to 60 percent capacity and cutting the IT budget by $150 million in five years. Plus the new mainframe is expected to take up one third of the square footage currently used.
What do you think?
—Jon
http://washingtontechnology.com/articles/2013/03/21/ibm-ohio-contract.aspx
http://finance.yahoo.com/news/state-ohio-awards-ibm-contract-134800920.html
Topics: Executive Suite
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Posted by CSIBlog
Apr 2, 2013 5:30:50 AM
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Here are five common mainframe myths dispelled:
http://enterprisesystemsmedia.com/article/linux-on-system-z-new-beginnings
Topics: Executive Suite
Posted by CSIBlog
Feb 20, 2013 3:30:25 AM
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