EU launches anti-trust investigation into IBM's mainframe practices

Probe to investigate alleged mainframe dominance abuse by Big Blue

EC to investigate mainframe market practices by IBM

The European Commission (EC) has initiated formal anti-trust investigations against the IBM Corporation in relation to its conduct in the mainframe market.

The EC has said it will look at two separate cases of alleged infringement of EU anti-trust rules where it sees the abuse of a dominant market position.

The first case follows complaints by emulator software vendors T3 Technologies and TurboHercules, alleging that IBM has tied mainframe hardware to its mainframe operating system. It was this hardware that the software vendors were emulating; and IBM's alleged actions have prevented them being able to sell software that runs on the company's operating system.

The second case sees the EC investigating the company for alleged discriminatory behaviour towards competing suppliers of mainframe maintenance services. It has launched the case on its own intiative.

The EC says that in 2009 about €8.5bn (£7.1bn) worldwide and €3bn in the European Economic Area was spent on new mainframe hardware and operating systems.

Software developer and governmental affairs professional Florian Mueller said: "I'm convinced that customers are being locked in and milked shamelessly by IBM, and I hope that the outcome of the process will result in more customer choice."

Ironically, IBM made one of its biggest mainframe announcements of the past 20 years last week, unveiling the next generation of its mainframe hardware, zEnterprise.

According to IBM, ZEnterprise allows users to run x86 applications on server blades which could be managed by IBM’s Unified Resource Manager, announced at the same time.

The EC also said it had concerns that IBM may have engaged in anti-competitive practices with a view to foreclosing the market for maintenance services.

The commission has indicated that it may also make public the initiation of proceedings in any appropriate way, although it would inform the parties concerned before doing so.