IBM Revives Power 770 Discount Deal For Spring Push

Published: May 14, 2012

by Timothy Prickett Morgan

Back in March, when IBM was hot to sell some of its fairly large Power 770 servers to close out a good first quarter, the company whipped out a quick rebate scheme for the processing capacity on the machines that I dubbed March Madness. It is not clear how effective this deal was, but it has come and gone and now IBM has a similar rebate to push some more Power 770 iron here in the second quarter.

The original March Madness deal in announcement letter 312-038 gave the same discounts on two generations of Power 770 machines with roughly equivalent processing features but different memory and I/O capacities. The original Power 770 from February 2010, what IBM calls the 9117-MMB machines and which I call the Power 770 Gen 1 machines to keep them straight in my head, are based on 3.1 GHz and 3.5 GHz processors; they have PCI-Express 1.0 peripheral slots, 8 GB memory sticks, and scale from one to eight processor cards with either 48 or 64 cores, depending on the processor chosen. The Power 770 Gen 2 machines as I call them and 9117-MMC as IBM calls them, have slightly faster 3.3 GHz and 3.7 GHz Power7 processors; they also sport PCI-Express 2.0 slots and supports 16 GB memory sticks to double up the system memory capacity. The Gen 1 and Gen 2 machines have exactly the same list price for processor cards and processor core activation features.

In the March Madness deal, depending on the configuration, the rebates that IBM offered to customers buying new Power 770 machines ranged from $7,000 to $37,000 and amounted to somewhere between 10.5 percent and 15.1 percent off the price of buying the processor cards and activating the cores on the cards.

In announcement letter 312-058 last week, IBM launched the Power 770 Spring Rebate promotion, which cut the discounts back a bit on Power 770 processor cards, but the money is still significant. As you can see in this analysis table I built for this latest deal, the rebates now range from $6,500 to $35,000 and that works out to somewhere between 9.6 percent and 14.7 percent off list price for the raw processing capacity in the Power 770 for the configurations in the deal.

The Power 770 Spring Rebate deal runs until--you guessed it--June 30, which is the end of IBM's second quarter. So it looks like IBM has a lot of Power 570 and 595 gear running AIX and IBM i that it wants to move ahead to Power7 iron as well as needing a deal sweetener to chase big Solaris and HP-UX shops. I cannot think of more than a few thousand IBM i shops that would need dozens of IBM i cores, but such a box could be used to consolidate AIX and Linux workloads onto a single machine. But for most IBM i shops with less than 40,000 CPWs of capacity needs, the Power 750 Gen 1.5 machines and the Power 740 Gen 2 machines, which have 3.72 GHz processors, are a better fit for a P20-class machine because the CPUs run faster than the ones in the cheaper--and slower--Power 770 boxes. Every gigahertz counts.

I will remind you once again that IBM put out a processor book promotion back in January that runs until June 22 that gives customers a 16.8 percent on processor books for Power 770 machines using the six-core Power7 processors. Presumably you can get the Spring Promotion rebate and have the freebie processor books thrown at you and mix both deals. In the processor book deal you have to two buy two books, activate a dozen cores, and then IBM gives you one book for free. You can do that twice to flesh out the system.

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