But Wait, There's More
Look for the 'Four Hundred 2005 Special Report' on December 15
Another year is winding down, and all of us are looking ahead to 2005 and beyond. So what does the future of the IT market in general and the iSeries market in particular hold? What are the products and policies that OS/400 shops would like to see IBM and its partners implement in the iSeries? Find out in the "Four Hundred 2005 Special Report," which will be published on December 15. You don't have to do anything special to receive this report. We are sending it free to all subscribers to our OS/400 newsletters as a holiday gift.
FalconStor, ICM Partner for iSeries Storage Gateway
FalconStor, a Melville, New York, supplier of storage services software, has partnered with ICM Computer Group, a British supplier of high availability services, to deliver a storage gateway appliance for the iSeries product line.
The Nexus Storage Gateway from ICM will run FalconStor's IPStor Enterprise Edition software, which is used to create a single storage infrastructure based on SAN and NAS devices operating over Fibre Channel, IP, SCSI, and iSCSI protocols. In addition to providing connectivity services, the IPStor software also offers active-active failover, synchronous mirroring, remote replication, dynamic multipathing, and other high availability features for the storage devices in its storage pool, which is why ICM is interested in creating the gateway for the iSeries. ICM claims that it is the leading independent supplier of services for the IBM midrange in the United Kingdom, and it wants to be able to more easily administer the iSeries servers and their storage that it manages on behalf of customers and to schedule the journaling of disk images, mirroring of disk data, and replication of data between systems. ICM has not said when the Nexus gateway will be available, what it will cost, or if it will try to sell it outside of the U.K.
Greif Says It Saves $1 Million with SSA Global Applications on the i5
IBM, SSA Global, and Sirius Computer Systems are cranking up the PR machine for the iSeries, and they announced last week that they had collectively created an eServer i5-based solution for industrial packaging manufacturer Greif that allows it to save $1 million in IT costs per year.
Greif, which is located in Delaware, Ohio, and runs 160 plants in 40 countries, has been an SSA BPCS customer for a long time, and engaged IBM, SSA, and reseller Sirius to come up with a server consolidation strategy that would save it some money. Greif has acquired some companies that ran the Baan ERP suite on a mix of Windows and Unix, and decided to consolidate its OS/400-based BPCS applications and those Baan applications (which were running on iron from Hewlett-Packard) onto a single i5 Model 570 that is running OS/400 and AIX partitions and supporting those same applications. Greif has a 16-way Model 570 with half of the processors turned on to support its combined ERP applications, and this server has replaced a total of 17 OS/400, Windows, and Unix servers. Greif says it has plans to activate some of those spare partitions for running Linux, but doesn't say why. The odds favor it moving some network infrastructure workloads onto the i5 box.
The Sports Authority Buys 18,000-Employee License for Kronos iSeries Central
We always like to hear when a big company decides to invest in the iSeries in a big way, and we are happy to report that The Sports Authority, one of the largest sporting goods retail chains in the United States, has bought an 18,000-employee license for the iSeries Central workforce management software from Kronos.
The license covers the employees at 400 stores and is an example of the iSeries winning out over competitive options in the wake of a merger. The Sports Authority merged with Gart Sports a year ago, and the latter was already using the iSeries Central software. After looking at its options for the combined company, The Sports Authority decided that the iSeries package was the best solution and bought a license from Kronos to cover the whole company.
IBM Sets Up Power.org Community for Power Chips
If the open-systems and open-source movements have taught us anything, it's that a technology that is malleable by the organizations that use it is more widely and more quickly adopted than a technology that is held by one or a few vendors. That is why IBM opened its Power chip architecture to wider licensing in March 2004, and why the company launched the Power.org community recently at its Power Everywhere Beijing event in China.
IBM, Motorola, and Apple formed the PowerPC Consortium back in 1991 to develop a set of RISC processors that would support IBM's workstation and server lines (which ran on Power and proprietary chips), Apple's workstations and laptops (which used Motorola 68000 processors), and the vast embedded controller chip business that Motorola had through the 68000 chip family. The idea back then was to take on Intel's X86 processors as well as RISC alternatives from Sun Microsystems, Hewlett-Packard, Digital Equipment, and SGI. While Apple and Motorola have had their ups and downs with the PowerPC, IBM has turned its Power chips into a strategic differentiator.
As IBM said back in March at the original Power Everywhere event in New York, the company wants to do an end-run around the X86 and take over the high and low ends of the IT markets. IBM knows full well that it can't get Power chips easily onto the desktop or in volume servers. But the chips are used by the tens of millions a year in all kinds of embedded devices (such as printers, PDAs, automobiles, routers, and game consoles) as well as in midrange and high-end servers. However, developing and manufacturing the family of Power processors takes big bucks, and IBM needs to foster a community of Power chip enthusiasts who will help shoulder the burden of development and manufacturing. For instance, IBM spent $2.5 billion to create the 300mm chip factory in East Fishkill, New York, where it makes its latest Power processors, and it spent $500 million to design the Power4 and Power4+ processors. The company is now expanding that East Fishkill facility, presumably to prepare for the manufacturing of the "Cell" Power-derived processors that Sony and Toshiba have been working with IBM for more than three years, to develop for future game machines and consumer devices. And they have paid for this Cell work; exactly how much is unknown, but the word on the street is that the three Cell partners have paid $400 million to create the chip, which is a variant of IBM's 64-bit Power processors with huge amounts of floating point processing power.
Earlier this year, Sony gave IBM $325 million to work out the kinks in the 65 nanometer processes that were supposed to be used to create the Cell chips, which are now going to be made in IBM's 90 nanometer processes. L-3 Communications, a defense electronics firm, said this spring that it would kick in $80 million over five years to license Power chip designs. The Global Brands Manufacture Group, a Chinese computer maker, is looking at creating a line of Power-based desktops and laptops as well as digital cameras and DVD players, and has similarly licensed Power technology from IBM. Chartered Semiconductor, a chip maker based in Singapore, will be the first non-IBM fab to make Power processors using IBM's own 90 nanometer copper/SOI technologies; Infineon and Samsung also have licensing deals for custom Power chip designs and fabrications. Somewhat strangely, not all of these players are yet members of the Power.org initiative. Toshiba was noticeably absent in the Power.org lineup, as were Motorola and Apple.
The Power.org community is similar in concept to the Eclipse Consortium, which IBM launched several years ago, with a $40 million grant, to create a set of open-source development tools with a single interface and framework. In February 2004, the Eclipse consortium was reorganized into a nonprofit corporation that is completely independent from IBM. Power.org is already independent from IBM and is organized much like Eclipse, in that it has founding members that organize themselves into working groups. IBM has not said how much seed money it has pumped into Power.org, but that it is donating intellectual property. One example is the Core Connect bus interface used in embedded Power processors, which, IBM says, has 1,500 licensees already. The founding members of Power.org include IBM and Sony, as well as AMCC, Bull (which rebadges IBM's Power servers), Cadence Design Systems, Chartered Semiconductor Manufacturing, Culturecom, Jabil Circuit, Novell, Red Hat, Shanghai Belling, Synopsys, Thales, Tundra Semiconductor, and Wistron. The idea is to allow these companies that are interested in Power chips to collaborate without having IBM necessarily in the loop.
As part of the Beijing announcements, IBM has promised to add 150 engineers to its Power Architecture Technology Center in Shanghai over the next 18 to 24 months; the Power chips used to be designed exclusively in a PowerPC facility in Austin, Texas, and in IBM's labs in Rochester, Minnesota, but the political and economic realities are such that if IBM wants China to push Power, it has to give Chinese engineers jobs. IBM also is working on a deal with Shanghai Belling, China's biggest semiconductor company, for it to license Power chip technology and make chips for consumer devices. Peking University is also going to host a cluster of Power servers to allow software developers to test open source applications without having to buy their own servers.
IBM's top people in the Microelectronics Division also outlined an emerging chip technology called wet immersion lithography, which allows tweaked versions of the current class of lithography equipment used to make 300mm wafers to support thinner transistor lines. By using de-ionized water or other liquids, where light can be bent more efficiently than it can be in air, smaller circuits should be possible, thereby upholding Moore's Law (the number of transistors you can pack on a chip doubles every 18 months or so). IBM has been able to build variants of the Power chips using this under-water lithography, and it's the first company to do so. The process has been under development for a number of years. IBM did not say its Microelectronics Division might bring it to market with commercial Power chips.
Oracle to Merge Apps After PeopleSoft 9, If It Prevails
Oracle hosted the annual OracleWorld customer trade show in San Francisco last week and tried to calm the nerves of PeopleSoft customers who think Oracle is not going to do right by them if it prevails in its takeover of the company.
Oracle CEO Larry Ellison said that the company would support PeopleSoft customers and "invest heavily" to ensure that PeopleSoft customers remain happy and pay for software and support. He also said that when (not if) the acquisition of PeopleSoft is accomplished, Oracle would complete work on the PeopleSoft 9 update of its ERP suite. All of this sounds fine. But after PeopleSoft 9 is delivered, Ellison said, the company will deliver a merged product line that it will sell to both PeopleSoft and Oracle customers. This may not be something that either Oracle or PeopleSoft customers want, and it's certainly not something that is appropriate for the 4,000 or so iSeries shops running the World ERP suite, which is coded in RPG and integrated with DB2/400.
Oracle never says anything about what its plans are for iSeries shops running JD Edwards software, since these customers never really fit into PeopleSoft very cleanly and will stick out like a small, sore thumb in a combined Oracle-PeopleSoft. It seems likely that Oracle will spin out or sell the iSeries portion of the business. Oracle could get aggressive and try to convert these shops to other platforms and software, but it would have to give away its software--and probably more--to get them to do it. It is hard to say if a spinout of the iSeries part of the JDE business would be better or worse for that specific software business or the iSeries base as a whole. A tightly focused iSeries software company would be great as a competitor and champion for the base (as JDE, SSA Global, MAPICS, and others used to be), but it also would be a lot smaller than SAP, Oracle, and Microsoft, which would give it less maneuvering room and more shallow pockets.
WRQ Acquired by Venture Capitalists
Host connectivity vendor WRQ announced last week that it has been acquired by two venture capitalist firms. The terms of the acquisition were not disclosed, since WRQ is a privately held company, as are the two venture capitalists, Francisco Partners and Thoma Cressey Equity Partners. The deal is expected to close in a few weeks.
"With WRQ's financial performance, reputation and large loyal customer base, the company now has even greater growth potential," Doug Walker, cofounder and CEO of WRQ, said in a statement. "The resources and expertise of Francisco Partners and Thoma Cressey Equity Partners will better enable WRQ to deliver on that potential and further position WRQ as a market leader. WRQ looks forward to continuing to serve our customers and offer new products and services to them in the future." After the deal closes, Walker plans to retire, and Shaun Wolfe, the company's president and chief operating officer, will become CEO.
WRQ, which sells its Reflection host access software for clients and Verastream host integration middleware, has about 6 million customers. The company was founded in 1981. In 2003, WRQ had sales of nearly$100 million, was profitable (but how much is unclear), had no debt, and enjoyed an 87 percent renewal rate in its Reflection licenses and a 50 percent growth rate on its Verastream product, which is a pioneer product in the services-oriented-architecture approach to building applications. The company sounded more like one that was looking to go public once the stock market picked up than one looking for backers. But with the stock market still rocky and Walker wanting to retire, it's possible that selling was quicker and easier than going public.