Yet Another IBM Pricing Scheme For Power MSPs

February 1, 2016 Timothy Prickett Morgan

One of the problems with hardware is that it is a sunk capital cost to acquire it, which is why financing and now cloud computing, where you lease or rent the capacity in a server or storage array rather than buy it, is popular. But the service providers building Power-based clouds are not always happy to do financing. They want IBM to offer flexible pricing without them having to take the risk.

And so, several times over the past couple of years, Big Blue has offered special pricing for systems software and hardware to managed service providers. In announcement letter 116-003, IBM is offering yet another pricing scheme to MSPs, in this case on very specific configurations of its Power S822 two-socket server.

That machine is significant for a number of reasons. First, when the Power8 machines launched back in April 2014, the Power S822 was in the lineup, but it was only allowed to run AIX and big-endian Linux. The Power S822 node is used in IBM’s PurePower converged systems, which debuted in the summer of 2015 in the wake of IBM’s sale of its System x server division to Lenovo Group. These converged systems are aimed specifically at cloud builders, and that is why IBM eventually allowed for IBM i to run on the Power S822 nodes last October.

So given IBM’s desire to have MSPs embrace IBM i and put it on the cloud, it is a bit perplexing to find that this new Power Systems EasyScale for MSPs offering is only being made available for Power S822 machines running AIX or Linux. It should obviously include IBM i, too.

Under this EasyScale for MSPs deal, IBM configures a Power S822 with two 10-core Power8 chips running at 3.42 GHz and a single 146 GB disk drive; only one core is activated on the machine. With 256 GB of main memory, it costs $2,000; with 512 GB it costs $4,000; and with 1 TB it costs $8,000. For the base price, the Linux and AIX machines cost the same. To activate cores, IBM is charging in 570-day increments, and the price varies depending on the original memory configuration and operating system chosen. For the skinny memory Linux machine, each core costs $5,100 for 570 days; on the midrange setup, it is $7,000 per core; and on the heavy configuration it is $12,300 per core. The AIX premium is 49 percent higher for the skinny config, 35 percent for the middle config, and 20 percent for the heavy config.

By the way, you can add more storage to the machines, but IBM says the memory and processor configurations in the Power S822s bought under this deal are set in stone. The PowerVM Enterprise Edition hypervisor is thrown into the deal to virtualize the compute and I/O, too.

I can understand why IBM wants to keep the Linux prices lower to compete with Xeon-Linux systems that dominate the cloud and parts of the corporate datacenter. But I can’t understand why it doesn’t also want to sell its own AIX and IBM i platforms on clouds built from the Power S822s, and why it is not putting IBM i in this deal is completely annoying. Customers and business partners should complain. Loudly.

IBM will start shipping Power S822 machines under the EasyScale for MSPs plan on February 26, so there is still time for the company to do right by IBM i.

And while I am thinking about it, if IBM is willing to give such flexible pricing to MSPs, why not to the entire Power Systems customer base? Why are private clouds any less important than public ones?

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