The Four Hundred - IBM Launches New Gap-Filling iSeries Model 870

IBM geared down the Model 810 iSeries machine back in May to offer a machine with a lower sticker price and a smaller amount of performance that would fill a gap between the entry Model 800 and the Model 810 machines. This week, IBM will fill another gap in the iSeries product line, which was revamped in January. Big Blue is announcing a geared-down Model 870 machine to fill an even bigger gap between the Model 825 and the prior Model 870.

The original second-generation iSeries line, announced last January, had nine distinct machines that spanned a power range of 300 CPWs to 37,400 CPWs, with one to 32 PowerPC or Power4 processors. But there are some holes in the line and issues that IBM has had to deal with in order to more closely align the product with the needs of customers. With this latest tweak, IBM has added two machines to the line. The company has not yet added support for the Power4+ kickers to the Power4 processors, and these could be coming any month now or early next year. The Power4+ chips run at 1.2 GHz, 1.45 GHz, 1.5 GHz, and 1.7 GHz, while the Power4s, which are used in the Model 825, Model 870, and Model 890 servers, run at either 1.1 GHz or 1.3 GHz. The Model 800 and Model 810 iSeries machines use 540 MHz and 750 MHz S-Star PowerPC processors, which are several years old.

The Model 810-2465 uniprocessor server, announced in May, is based on the same 540 MHz S-Star PowerPC processors as the Model 810-2466, which was previously the smallest iSeries machine that could run the full OS/400 Enterprise Edition. The Model 810-2465 with OS/400 Enterprise Edition is rated at 750 CPWs and costs $55,000. That works out to $73 per CPW on 5250 OLTP workloads. This price/performance compares favorably with the Model 810-2466, which costs $78,000, is rated at 1,020 CPWs, and results in a price/performance of $76 per CPW. The more powerful Model 810-2467 and 810-2469 servers cost $120,000 and $230,000 respectively, and yield a little bit less bang for the buck, at $82 and $85 per CPW. Running OS/400 Standard Edition, the geared down 810-2465 costs $11,000, while the Model 810-2466 cost $12,000. Clearly, the geared down Model 810 machine was not aimed at people who were buying iSeries machines just to run modern, non-5250 applications. (For those of you not quite used to IBM's new nomenclature for OS/400 packaging, the standard edition is for Web, Java, and any other workload that does not make use of OS/400's 5250 green-screen protocol. OS/400 Enterprise Edition activates the 5250 protocol and can bring the full processing power of the iSeries server to bear on it.)

You might think of this new Model 870 as the midrange of the midrange, and it is aimed at customers using either OS/400 Standard Edition or Enterprise Edition. It is in particular aimed at customers who fall into the gap between the Model 825, which has from three to six 1.1 GHz Power4 processors and has a performance range of 3,600 to 6,600 CPWs, and the prior Model 870, which had 8 to 16 processors and 11,500 to 20,000 CPWs of performance. That gap between 6,600 CPWs on the Model 825 and 11,500 CPWs on the Model 870 is a pretty big one, so IBM has tweaked the Model 870 to create a different package that has five to eight processors and 7,700 to 11,500 CPWs of power. It very neatly fills this gap.

The new Model 870-2489 uses the same I/O, memory, and capacity-on-demand instant upgrade features as the Model 870-2486. Main memory ranges from 8 GB to 64 GB, and has only two memory slots. The bigger Model 870-2486 can support from 8 GB to 128 GB of main memory, and has four memory slots. This means that 870-2489 customers have to be careful about what memory cards they buy, since they have to be installed in pairs. If you install 16 GB of main memory (two 8 GB cards), for instance, you need to double up to 32 GB; you will have to remove your two 8 GB cards and buy new 16 GB cards. This can be very expensive, and there is not yet an organized market in second-hand iSeries memory for the revamped line in which customers could get at least some of their money back. Customers who upgrade to the Model 870 from Model 740s, 830s, or 840s can get partial credit on the memory they have installed, according to IBM sources. Customers have to trade in four Model 740 or 840 memory features for each Model 870 memory card, and eight Model 830 memory features for each Model 870 memory card. Any additional memory cards installed on the older kit cannot be traded in. IBM is not saying anything about trade-ins for memory cards for customers who upgrade from the new 870-2489 to the bigger Model 870-2486. Both Model 870s can support up 3.1 TB of internal disk and have seven LAN ports, 38 communications lines, and room for two Integrated xSeries Servers. Activating each additional processor on the machine costs the same, too, at $25,000 a pop. (Activating processors costs $20,000 on the Model 825 and $30,000 on the Model 890.)

The new Model 870-2489 is also in the same P40 software tier as the Model 870-2486. This is something that customers who might otherwise buy a big Model 825, which is in the P30 software tier, have to think about. Jumping from a P30 to a P40 software tier can mean spending hundreds of thousands of extra dollars--sometimes more--on a software stack. IBM could have made a P35 tier that split the difference, but its a software vendor itself, and is at the mercy of software resellers that push the iSeries and want each server in a given power range in the highest tier that the market will bear. Given this, you can see why there is no P35 tier, and why IBM has not added software tiers since it moved backed to tiered pricing after a few years' hiatus with user-based pricing in the mid-1990s.

As you can see in the table, the Model 870-2489 machine has a lower cash outlay than the existing Model 870, but the price/performance on this box is not as good. And a five-way Model 870-2489 with 7,700 CPWs of power running OS/400 Standard Edition is only $55,000 cheaper than an eight-way Model 870-2486 with 11,500 CPWs of power. As IBM itself conceded to business partners briefed on the forthcoming machine last week, the bigger Model 870 is a better bargain for customers, except those who know they will never need anything larger than an eight-way Power4 machine for the next few years. Indeed, with OS/400 running on all eight processors, the new Model 870-2489 running OS/400 Standard Edition costs $510,000, which is 27.5 percent more expensive than a base eight-way Model 870-2486 with the same OS/400 edition. The price disparity is less jarring on eight-ways running OS/400 Enterprise Edition. An eight-way version of the new Model 870-2489 costs $1.13 million, compared with $1.33 million for the Model 870-2486. That's only a premium of 17.6 percent.

IBM says that the best prospects for the new Model 870 machine are customers who were considering a move to a bigger Model 825 configuration but want to avoid having to change memory cards when they move to a Model 870 some time down the road. Customers who need more I/O and memory would do well to consider the new Model 870 over the Model 825, too. Customers with Model 740s with either 3,660 CPWs or 4,550 CPWs of power, and companies with Model 830s with 7,350 CPWs of power, are probably the best fits for this new box.

IBM will announce the new Model 870-2489 on July 22 and will begin shipping it on July 30. It requires OS/400 V5R2, either Standard Edition or Enterprise Edition, as do all of the revamped iSeries machines from this year.

Big Blue plans to make some other minor tweaks and changes to the OS/400 platform, and we'll tell you about those next week. The new Model 870 is the big news.