Analysts disagree over IBM z900 upgrade

IBM mainframe users considering an upgrade to the vendor's z900 processor are facing conflicting advice from analysts.

Gartner claims that users can cut costs by upgrading to the z900 from its predecessor, the S/390, through IBM's new workload-based pricing scheme.

But rival analyst Giga Information Group has cast doubt on the possibility of saving money through upgrading. It claims that with IBM's own software licences representing less than 45 per cent of a typical user's mainframe budget, much of the potential saving from workload pricing is dependent on fees charged by independent software vendors (ISVs).

"We are hopeful, but sceptical, that there will be significant ISV buy-in to IBM's pay-what-you-use licence scheme. ISVs have promised modifications to their deals in the past and not delivered," said Giga's Colin Rankine.

And another analyst company, Meta Group, is warning that a new mainframe software licensing agreement introduced in the US is an early sign that IBM intends to force S/390 users into upgrading to the z900.

Big Blue has eliminated its annual billing agreement, replacing it with a new software growth attachment program. Meta estimates that the change will increase most OS/390 software budgets by between two and five per cent in 2001, which could be as much as $100,000 for medium to large users.

"IBM is confusing an already confused user base. It's definitely trying to push users to move to the z900. The problem is that there's no immediate reason for them to do so," said Meta program director Rakesh Kumar.

The vendor claims that there are no plans to change software licensing agreements in Europe. "I don't think what we're doing with software is designed to encourage users to change hardware," said David Wilson, European sales director for S/390 software.

First published in Computing