IBM Lets MSPs Have Utility-Priced IBM i 6.1 For Clouds

April 8, 2013 Timothy Prickett Morgan

If you want to build a cloud and charge utility style pricing, it is very tough to come up with the capital ahead of time to get the hardware and software to build that cloud and then wait patiently as you find customers to pay monthly fees to use that infrastructure. IBM Global Financing has always offered financing on new machines at fairly attractive prices, but to go after managed service providers and help them build cloudy infrastructure based on IBM i, Big Blue has been giving deep discounts to MSPs for specific hardware and also providing utility pricing on IBM i and AIX.

Back when Technology Refresh 5 was announced for IBM i 7.1 on October 3 last fall, IBM debuted MSP pricing on IBM i 7.1 and AIX 7.1, charging $500 per core per quarter (that’s three months). That price applied to IBM i 7.1 and the integrated DB2 for i relational database and also applied to AIX 7.1 Express, Standard, or Enterprise Edition, just to keep it simple. In announcement letter 213-111 from April 2, IBM extended the special MSP operating system pricing back to IBM i 6.1 and AIX 6.1. The licenses for these older operating systems can be used on Power Systems rack and tower servers as well as BladeCenter PS7XX blade servers.

This being an IBM i newsletter, the ability to peddle the older AIX 6.1 release by MSPs is inherently not as interesting as being able to put IBM i 6.1 on clouds, but the same issues driving IBM’s decision apply. There are many more applications that are certified on the 6.1 releases than on the 7.1 releases, and some customers need these older releases to be able to move their applications to the cloud. I would argue that there are lots of customers who need i5/OS V5R4 and that IBM should allow for applications for this old and soon-to-be-expired release to be run in emulation mode atop the PowerVM hypervisor. But that said, giving MSPs utility pricing on IBM i 6.1 is important and will greatly expand the ability of MSPs to attract customers, particularly in cases where third-party software suppliers have long since certified their applications on IBM i 6.1 and, for whatever reason, have not yet done so on IBM i 7.1. The backstep OS support is also important for customers who write their own applications, who are even less likely to port their code to each release as IBM brings it out.

Having said all that, I will echo the IBM party line that customers should try to get to IBM i 7.1 because of the Technology Refresh mechanism it has to update the operating system with important features without breaking application runtime compatibility and therefore requiring a recertification of applications for the updated release.

In addition to the support for the older IBM i and AIX releases in the MSP pricing program, IBM is also adding the PS702 entry blade server–that’s the single-socket, four-core Power7 blade–to the MSP Utility Pricing Offer that was announced last November, as you can see in announcement letter 113-044.

That deal, as The Four Hundred explained last fall, was available on PS703 blades as well as Power 720, Power 740, Power 770, and Power 770+ machines and has been expanded to include the Flex p260 and Flex p260+ Power-based nodes as well as the Flex x220, x240, and x440 Xeon-based nodes. Under that MSP offer, IBM is giving MSPs a 55 to 65 percent discount off the cost of the server nodes to help cushion the blow on building clouds as well as 60 percent off the IBM i or AIX licenses if they want to buy them upfront instead of using the utility pricing above.

With the BladeCenter PS7XX machines being the end of the line for Power-based blade servers and IBM focusing on Flex System iron going forward, it is quite possible that MSPs will be able to get very attractive deals on PS702 machinery if they don’t mind using technology that is a generation back. It stands to reason that some will go for it, and others will want to just use rack machines or the Flex Chassis and the p260 or p260+ server nodes to build out their clouds.