IBM Global Financing Deals To Push Power E950 And E980 Sales
September 24, 2018 Timothy Prickett Morgan
As we have pointed out many times before, Big Blue is not just a creator and manufacturer of technology, but as one of the largest renters and lessors of equipment with vast access to capital and a relatively strong balance sheet, it is also effectively a large bank focused on IT. And more times than not, it takes IBM Global Financing – and the economic might that parent IBM brings to bear – to close the deal, as much as any hardware or software technology does.
At the moment, IBM is focused on increasing sales of the midrange “Zeppelin” and high-end “Fleetwood” machine announced in August, pulling revenue that might have been generated in 2019 into the third and fourth quarter of 2018 so IBM can end the Power Systems division on a high. In particular, IBM is telling the reseller channel and its own sales force (which sells to the top 2,500 Power Systems accounts directly) that they should open negotiations with customers with financing options because this move can help alleviate discount levels. (To which our advice is to negotiate the best deal you can and say you are not all that interested in financing, but then change your mind at the last minute.)
IBM Global Financing offers three different financing options:
- Lease: Lowest periodic payment, protection against technology obsolescence, and lower TCO
- Payment plan: Low rate interest payment plan up to 60 months, or a 0 percent interest 12 month payment plan
- Payment deferral: Install now, pay later is available for both payment plans and leases
The financing, as you can see, can include a straight-up loan, just like a bank, but without any interest. All of these financing options can include servers plus system software and pre-paid one-year or three-year maintenance as well. Application software or SaaS services that are pre-paid can also be rolled into financing, and so can non-IBM wares if customers need it as part of a larger deal that includes a lot of IBM stuff.
Under a promotional offer that will be available until December 1, 2018 – plenty of time for IBM to complete shipment before December 31 and therefore be able to book the revenue in 2018 – IBM is offering customers in North America and Europe a payment plan with a four-month deferral and then offers a low financing rate (at least according to IBM, but based on the credit rating of your particular company) on a 32 month deal. (In some countries, these deals are 30 or 33 months long with quarterly payments.)
Here is an example of the deals on Power E950 and Power E980 machines:
You can find out more about this Q3/Q4 2018 Global Financing promotion for Power Systems at this link.