All,

I read the response below in regard to below to Sabre. I have a comment and
take for what it's worth ( 30+ yrs - IBM MVS/VM/VSE/VTAM/CICS/TCPIP/NCP )
and now a developer. The thing that drove everyone off Mainframes according
to reports was the cost. So now small and medium shops have 1 or 2 or 3
mainframes to do the work and to convert to Unix or Windows they  have 30 or
more Unix or windows servers to accomplish usually less and more staff
required...Unfortunately, it usually boils down to money. After working for
a very very large IBM customer nationally and internationally for many years
I saw the effect of a company with mucho
bucks, we got just about anything we wanted, as long as we bought software
and hardware from IBM. When they switched to Hitachi, well the attitude
toward the company changed significantly. I wonder why ???

Scott Ford
Senior Host Developer | Forging Enterprise Identity |  IdentityForge.com
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-----Original Message-----
From: IBM Mainframe Discussion List [mailto:[EMAIL PROTECTED] On Behalf
Of Timothy Sipples
Sent: Monday, May 05, 2008 3:12 AM
To: [email protected]
Subject: Re: (Mainframe has competition was fwd) Re: COBOL Compiler for
Windows

>For example, Sabre (airline reservations, Travelocity) cut its total
>expenses 50% when it switched from mainframe to Unix.

I do not have any particular knowledge of Sabre, so I would assume absent
any information to the contrary that they're wonderful people.

But I do have a problem with whoever this poster is. I would advise
everyone to turn their marketing BS detectors to maximum when you see
claims like these. Always sanity check them. It's really quite easy to do.
Sabre Holdings went private in early 2007 (in a buyout by Silver Lake and
Texas Pacific Group), but they did publish their full year 2006 financial
results. Between 2005 and 2006 their operating expenses *increased* 12.3%,
while total revenues increased a more modest 12.0%. The comparable figures
are +20.7% and +18.3% for the year prior (2005 v. 2004). You can find these
data on their Web site.

When your costs increase faster than your revenues you suffer declining
gross margins in your business. Perhaps somebody could check prior years to
see if any of them show a 50% decrease in operating expenses. (I seriously
doubt it.) It might also be interesting to see margin trends, especially
relative to peer competitors.

Here's another sanity check. The biggest corporate operating expense is
generally payroll. Sabre reported having about 9,000 employees at the end
of 2006. If you assume each employee has a fully burdened expense of
$150,000 -- probably about right -- then that would be an annual total
expense of $1.35 billion. That amount is more than half of Sabre's entire
operating expenses for 2006, which makes sense given Sabre's business. In
other words, for the poster's claim to be true Sabre would either have to
fire almost every employee (without hiring replacement contractors) or
slash every non-payroll cost to zero. (The latter wouldn't quite make the
goal, actually.) So they'd either have buildings, equipment, and other
assets with no employees to operate them, or they'd have 9,000 employees
who don't have a single computer among them. Anybody think either case is
realistic? :-)

Look, if there are numerous and frequent strong business cases for moving
off the mainframe, why does this particular individual (at least) have to
fall back on ridiculous claims that are rather easily disproved by just
checking corporate annual reports? Why not just present honest facts if the
facts are so wonderful? Should a rational person believe any other claims
from such a person? (Again, I don't know much about Sabre, so I don't even
know if they "switched from mainframe to Unix.")

That said, I do agree with one thought: there's choice and competition in
where to run workloads.

As a reminder, my opinions are my own and do not necessarily represent
those of my employer or anyone else.

- - - - -
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]
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