IBM Cuts Memory Conversion/Activation Prices on Older Power 570s

Published: June 14, 2010

by Timothy Prickett Morgan

Clearly some big Power Systems customers are not quite yet ready to let go of i5/OS V5R4 and AIX 5.3, something I surmise by the fact that IBM last week chopped memory prices on its older iron.

Yup, you heard that right. Only a few weeks ago, as The Four Hundred previously reported, IBM had to tweak some upgrade prices for customers moving from Power 570 to Power 770 and 780 boxes, lowering the price of converting DDR2 memory activations on the Power 570 when they are converted to DDR3 memory blocks on the new Power7-based Power 770 and 780 machines. IBM didn't explain its rational, but I simply think someone typed in some wrong numbers somewhere and the prices were not consistent with other upgrade fees for memory conversions.

Last week, in announcement letter 310-194, IBM dropped the price of memory activation feature conversions between older Power5 and Power5+ machines bearing the Power 570 label (in both the i5 and p5 sides of the formerly separate Power Systems houses) when customers upgrade to Power 570 machines using Power6 or Power6+ processors. Both sets of machines used DDR2 main memory, but with different feeds and speeds and thus require conversion. IBM's old price for converting 1 GB of main memory from the old machines to the Power6/6+ boxes was $758 per GB of activated memory. Which, given the fact that 1 GB of capacity on the open market costs a hell of a lot less than this, is totally nuts. My guess is that some AIX and i shops want newer iron (not brand new Power7, but newer Power6 or Power6, machines) but don't want to make the jump to i 6.1 or 7.1 or AIX 6.1. The i releases require program conversion and requalification of apps and the newer AIX release would require requalification. With i5/OS V5R4 able to run on Power6/Power6+ iron, not jumping to Power7 iron is the easy way out. Exactly the right move for midrange shops not looking to spend a lot of time and money on program conversion in a jumpy economy.

Also, there are probably resellers that have inventories of Power6 and Power6+ machines in the 570 class, and they want to move this iron. One of them being IBM Global Financing that is no doubt taking old machines back in trade as some customers upgrade to Power 770s and 780s. Those memory conversion prices are too high and will kill deals given the relatively low price of memory on the new Power7 iron and the equally low Power6/6+ machines, which got a memory price cut last November in anticipation of the Power7 launch in early 2010.

At any rate, whatever the reason, now if you have an old Power5 or Power5+ 570-class machine, you can convert your memory activations over to 570 boxes using Power6 or Power6+ machines for $293 per gigabyte. That's a 61.3 percent price cut, and will significantly cut the cost of upgrading that vintage iron.

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