According to the press reports IBM System z revenue grew 4% year on year with 45% MIPS growth. It's the 8th straight quarter of mainframe MIPS growth, something that hasn't happened in well over a decade.
A few comments on this. First, and most importantly, thank you once again. Everyone in the extended IBM mainframe community sincerely appreciates your continued enthusiasm and support. It's important to note that this is the first quarter with a z9 BC model comparison. That is, in 2Q2006 the z9 BC began shipping. Analysts are now observing correctly that this continued strong growth is well outside any product cycle bump. Also, that combination, revenue growth with declining per-unit prices, is really good for both mainframe consumers and for IBM alike. Much of the MIPS growth is of the "new workload" variety, e.g. Java on z/OS (zAAPs), Linux (IFLs), and zIIPs, and that's another very positive sign. A healthy mainframe market needs both organic growth (higher business activity driving existing applications) and steady additions of new applications, and that's exactly what IBM says happened. The IBM software numbers were extremely strong. Although IBM does not break out mainframe software -- it's actually very hard to do that since we have a lot of multi-platform part numbers -- the Tivoli brand was up 33%. That's hard to account for unless System z software performance was strong, especially given the addition of Consul's products to Tivoli. WebSphere and Information Management brands were also very strong, representing the other two brands with the heaviest System z software portfolios. Tape -- remember tape? -- grew 19%. It's still the most cost-effective medium for myriad data storage purposes. Just a guess, but I bet there was strong demand for the TS1120 which can encrypt data at the drive, to protect customer and business privacy. That's a hot issue right now. Here's what Mark Longbridge, IBM CFO, said on the earnings call, in response to a question about System z product cycles: "...It's hard to use the old metrics to apply to this [mainframes]. It's a different business, it’s a different value proposition and now moving into newer markets." As a reminder, I don't speak for IBM, and I certainly cannot provide any stock market advice. - - - - - Timothy Sipples IBM Consulting Enterprise Software Architect Specializing in Software Architectures Related to System z Based in Tokyo, Serving IBM Japan and IBM Asia-Pacific E-Mail: [EMAIL PROTECTED]
