IBM “Harmonizes” Power Systems, Storage, And Software Prices Upward
November 28, 2022 Timothy Prickett Morgan
The worsening economic conditions and the strengthening of the U.S. dollar against other currencies is forcing companies to do two things: Raise their prices in the United States in some cases, and raise their prices a little more than that in Canada, Europe, the Middle East, Africa, and Japan.
Last week, IBM did the latter on Power Systems and storage hardware and software, with the price increase taking effect on January 1, 2023. So if you are outside of the United States, you have time to close whatever deals you have in progress at the lower prices if you hustle a bit. And we think that if a recession really takes hold, IBM will raise all kinds of prices because it has pent up costs to cover – just like all businesses do.
“With the current macro-economic conditions including inflation at over 8 percent depending on the market, IBM must now revist and adjust pricing,” Kate Woolley, general manager of IBM ecosystem within Big Blue’s PartnerWorld organization, explained in a message sent out to business partners on November 22. “IBM is increasing list prices for EMEA, Japan and Canada across infrastructure (Power & Storage), and software (Software Trx, and Monthly License Charge).”
The price hikes on Power Systems servers are outlined in announcement letter 323-537, and range from 5 percent to 25 percent, depending on the country and the system or feature. In case IBM removes the pricing from its Web site, we have downloaded and stored the Power Systems hardware price change spreadsheet at this link. The price changes affect the Power E980, the Power E950, and the Power E1050, plus the Hardware Management Console, the Enterprise Slim Rack, and the rack-mounted console kit for system management.
The price hikes on IBM Storage products are outlined in announcement letter 323-536, and varies from 5 percent to 10 percent, again depending on the market and the storage server or device. The prices are going up on FlashSystem 5, 7, and 9 arrays, DS 8000 SAN arrays, the SVC virtualization controller, the ESS parallel file system appliance, and various tape libraries and drives. In case IBM removes this pricing, we have downloaded and stored the Storage systems hardware price change spreadsheet at this link.
The price hikes on the Distributed Software products, which often run on Power iron, range from 5 percent to 23 percent, depending, and are outlined in announcement letter 323-531. The details on the distributed software price hikes are in this spreadsheet. Here is a handy dandy chart that IBM gave business partners to show how the price changes on software running on Power and System z mainframe iron vary:
None of the IBM i software stack is affected by this price increase.
We did not know this, but IBM increased prices overseas on various software on September 30, and this more recent announcement supersedes those two announcements, which were outlined in announcement letter 323-481.
The amazing thing, as far as we are concerned, is that there has not been a generic, across-the-board price increase out of IBM United States, given the state of inflation and the dearth of alternatives for Power Systems and System z customers. Our guess is that pricing on Power10 and z16 systems already has that price increase baked in. It would not be surprising to see price increases on Power9 and z15 systems and their peripherals in the coming year, and any peripherals or services that are still available for Power8 and z14 systems.