The Four Hundred--How to Get a $4,000 Tape Exemption on Model 800s

A little more than a month ago, IBM released an announcement letter that looked like a $4,000 price increase on certain iSeries Model 800 servers. At the time, I said that this price increase seemed to be the result of a misunderstanding, and that customers should fight it. Here's how you do it.

A little explanation is in order. First, this price increase is not a huge deal, unless you happen to be a small business where $4,000 is a big deal. (It certainly is at this company.) In that September 5 announcement letter, IBM said that it had left the price of the entry Model 800 Value Edition at $8,795. When you purchase this machine, IBM does not require customers to buy a quarter-inch cartridge (QIC) or VXA-2 tape drive--or any other kind of tape drive, for that matter. (Programs are distributed on CD-ROM these days, so you don't need a tape for OS/400 or licensed programs.) This Model 800 Value Edition has a 540 MHz S-Star PowerPC processor, 256 MB of base memory, a single 17.5 GB disk drive, 25 CPWs of 5250 green-screen processing capacity, and a rating of 300 CPWs on non-5250 workloads.

The next two bigger Model 800 machines are more expensive, and now they require customers to pony up $4,000 to buy a 30 GB QIC or 80 GB VXA-2 drive. You cannot buy a Model 800 Standard Edition or Model 800 Advanced Edition configuration without also buying the tape drive. Many people, including myself, were under the impression that the standard and advanced Model 800 configurations included a tape drive with their original $14,860 and $34,363 price tags. But, alas, IBM says that a QIC tape was required but not included. They now cost $18,860 and $38,363, an increase of 27 percent and 12 percent respectively, to my way of thinking.

Knowing this, and knowing that small shops are particularly sensitive to price, I said that if you were buying a Model 800 Standard or Advanced Edition configuration, you should seek an exemption from this requirement and shop around for a tape drive from eStorage, GST, or another third-party tape supplier. These companies generally offer much less expensive tape drives than IBM, and they are often based on the same core technology that IBM is selling.

I shoot my mouth off pretty freely about how iSeries and AS/400 customers should be tough when they talk to IBM, but getting such an exemption requires proper procedures and paperwork--two things that I am allergic to. David Breisacher, CEO of GST, offered his advice on how to get such paperwork in order. He even gave me a sample of the special Request for Price Quotation form, which you need to have in order to get the exemption from buying the IBM tape drive. (In the normal IBM sales system, if you don't add the tape drive, the configurator will not allow the transaction to process, because it is not a valid configuration. The special request form allows the configurator to do the Model 800 deal without the tape drive.) To our knowledge, no one has put in the bid for the special request for a tape exemption yet, but once someone does, and it is approved, all customers will be able to use this form to avoid having to buy the IBM QIC or VXA-2 drive. To get you started, Briesacher gave me a quotation form for a disk drive exemption, which you can use as a template to create one for the tape. Somebody has to go first, people.

GST, which sells tape drives to iSeries and AS/400 customers for a living, obviously doesn't want IBM to lock it out of the tape acquisitions that OS/400 shops do. So you can understand the enlightened self-interest going on here. But this situation is larger than GST or eStorage or any other vendor. What if, for instance, a company has already invested in an LTO drive, or another technology, and doesn't want to buy a tape as part of the Model 800 deal? And, as Briesacher correctly points out, while QIC and VXA-2 drives are fine for many customers, they may not be up to the task in terms of capacity or performance for a machine that can house over 4 TB of disk capacity. IBM should be giving customers a choice in tape technology, not requiring them to buy into anything just because it wants to boost profits on its entry machines.