Our company is very willing to continue to pay version 3 price for version 5. If
IBM were to offer version 5 at version 3 price to its current customers now
running version 3 on flex almost all would take it. The fact that other
customers with large IBM machines are paying much less for version 5 would not
matter. When and if a company grows its flex box to where it approaches the size
of a small IBM box, then having VM cheaper on the IBM box will make a
difference. It will encourage users of large flex boxes to go to an IBM box.
[EMAIL PROTECTED] wrote:
I have no inside knowledge, but I have a pretty good guess. Remember that IBM
cut the cost of z/
VM in half going from version 3 to version 4, and then in half again going from version 4 to
version 5. Third-party vendors kept their software prices high (a cash cow) so IBM came up with
IFL so you could run z/VM and Linux without paying higher third-party prices.
This was, clearly, to sell IBM Series z hardware. IBM doesn't get that revenue from FLEX customers.
So it has to make the money entirely from the software. I don't think it can at the prices it is now
charging. (Just a guess!) Would the FLEX customers be willing to pay 4x or more as much for z/VM
as the Series z customers pay?
You say there are customers willing to pay. But are they really willing to pay what it actually costs
IBM, plus the current mark-up? (Remember, if IBM can get more profit somewhere else, they are
going to spend their money there instead.)
I think those of you who say this is short-sighted may well be right. I think all of American
business is short-sighted. The current methods of making a business case and planning simply
don't allow for more then a very few years in the future -- at most two or three.
I don't know whether the leaders of our corporations don't think there is much of a future or just
think the future is too unpredictable. Either way, the direction seems to be to only worry about the
stock price for the next six months.
This scares me! Phrases like:
- Take the money and run!
- Apres moi le deluge!
come to mind. I hope I'm just being overly imaginative.
Alan Ackerman
Alan (dot) Ackerman (at) Bank of America (dot) com
--
Stephen Frazier
Information Technology Unit
Oklahoma Department of Corrections
3400 Martin Luther King
Oklahoma City, Ok, 73111-4298
Tel.: (405) 425-2549
Fax: (405) 425-2554
Pager: (405) 690-1828
email: stevef%doc.state.ok.us
