Buy One XIV Array, Get Another For A Buck

March 3, 2014 Alex Woodie

IBM last week unveiled a new pay-as-you-go pricing scheme for its high-end XIV storage systems, which supports IBM i and other server platforms. The deal prevents customers from paying the full price of their XIV array until they’ve used a certain amount of the storage capacity. And when the first array fills up, IBM will ship a second XIV for an incredibly low–and incredibly un-IBM–price.

The deal is available to IBM customers through something called the Advanced System Placement program. Under this program, customers can get an XIV array installed at just a fraction of the full cost. The customer only pays for the full cost of the array once they hit a predetermined capacity threshold. And once they fill it up, IBM will ship customers a second XIV array for $1. IT shops can do this as many times as they need to, in order to meet storage needs.

IBM says the program is aimed at cloud storage and cloud computing operators, or at any organization that wants to have spare capacity to meet future storage demands. One operation that is already taking advantage of the program is Cegeka, a Belgium-based company that provides a variety of cloud-based services.

IBM’s third-gen XIV Storage System.

“For Cegeka, it means we’ll be able to get customers onto cloud storage solutions quickly, and they’ll be able to pay for it when they have the revenue to support it,” Luc Greefs, Cegeka’s director of shared technology and infrastructure delivery, said in statement. “The technological impact on our clients, whose data volumes are growing rapidly, will be profound.”

IBM also unveiled a financed version of the Advanced System Placement program that enables customers to enter into a 36-month hardware lease (and an equivalent “software loan”). For the first six months, the payments are just a fraction of the overall cost. Once a system hits a certain storage threshold, IBM ships the customer a second system, and the payments for the first system continue as planned. The second system also will come with its own 36-month lease, but the first six monthly payments are zero.

The XIV systems are one of IBM’s high-end, block-level disk arrays. Whereas the DS8800 line of SAN arrays run on Power processors and feature high-end network connections and disks, the XIV systems use commodity Intel chips for controllers and cheap SATA disks. XIV arrays connect to host systems via SCSI or Fibre Channel adapters, while inter-node connections within XIV clusters are handled via fast InfiniBand links.

When IBM launched the third generation of XIV systems two-and-a-half years ago, the base price of a XIV 2810 Model 114 device was $135,700 for a base module with a two-year warranty. A fully outfitted XIV cluster equipped with about 162 TB of usable capacity was going for about $2.8 million (which includes hardware, software, and maintenance).

Under the new deal, users can delay writing out checks of $100,000 or more to expand their arrays, and only pay once they have actually the storage. That’s a good thing, especially if customers can’t easily move their data to Amazon S3 or another cloud storage provider. This deal helps cloud providers make the economics work, and also helps customers become their own private cloud provider, which is also good thing.