CA plans UK launch for US licensing scheme

Computer Associates (CA) has promised to slash maintenance costs by more than two-thirds for UK customers that use IBM's OS/390 platform.

However, analysts warn that its proposed licensing scheme may not be as beneficial as it first appears. The scheme is already in use in the US. But it could prove costly if users' mainframe requirements rise over the course of the contract, warned Barry Graham, an independent analyst with researcher Xephon.

Currently, CA customers pay an annual maintenance fee for OS/390 software. The Millennium licensing programme will instead comprise a one-off licence fee and reduced maintenance fees. These are normally based on the power of customers' hardware but will be capped at 600 Mips.

"This is a great deal for those users who intend to stick with the mainframe platform for the next few years," said Jay Huff, product marketing manager for CA.

"It's good for CA because it increases its revenue in a given period," said Graham. "The problem for users is that the upfront licence fee assumes that you won't go past a certain point on your mainframe usage. If you do, then you could find that any price saving you negotiated could disappear."

About half of CA's revenue comes from products running on OS/390.

Last month, the company announced plans to allow IBM Multiprise users to lease software on a monthly basis.