IBM Lowers and Then Raises Ultrium Media Prices
July 14, 2008 Timothy Prickett Morgan
Sometimes, I think that IT vendors are just trying to drive us all crazy. On July 1, IBM put out an announcement letter (308-800 to be precise) that showed the company had significantly lowered the price of its Ultrium tape media for various tape drives in the TotalStorage family of products. As usual, I went through all the feature codes, explained what they are, and built a table that explains how deep the price cuts were. This is why you keep me around, I suppose.
Anyway, that table looks like this:
All is well and good and right in the world, since IBM took a hatchet and chopped prices on Ultrium tape media by a lot–particularly for the variants of the tape cartridges that function like WORM (Write Once, Read Many) drives. These price cuts were huge for IBM–ranging from 17.5 percent to 35.6 percent, depending on the feature; Big Blue tends to do things in the 5 percent to 10 percent range when it does official price cuts. To do otherwise is to admit an initial pricing error, I guess. Or to admit there is actually competition and that the list price should reflect the street price realities. (I would go a little further and say that street price should be standard across all customers and actually be the list price, which means no haggling. But I am crazy. . . . )
Anyway, so imagine my surprise as I am writing this story to see little old announcement letter 308-805, which came out on July 8 and which says IBM is jacking up prices on exactly the same Ultrium media features.
In fact, as this table shows, IBM jacked prices by 20.8 percent to 55.2 percent to get all the Ultrium media feature prices right back where they were before July 1. See for yourself:
Customers buying Ultrium media, which is quite expensive, might be tempted to see if their resellers had seen the second announcement yet. (I didn’t catch it until I went online to get the Ultrium feature codes, and it took me three beats to figure out there were two announcements.) But that would be dishonest. I find myself wondering exactly what IBM was planning, and when. I wonder what will happen on July 15 and then on July 22. Stay tuned.