Big Blue Boosts Trade-Ins For Power 770 Deal

May 21, 2012 Timothy Prickett Morgan

Boy, IBM sure seems hot to move its almost-top-end Power 770 servers these days. The company has two deals in the works, and it last week jacked up the trade-in credits on one deal while it at the same time backed off a little bit on the sweetener for another deal that went dormant at the end of March but which was revived two weeks ago.

IBM has been offering trade-in credits to customers who move from older Power-based servers or competitive Unix or proprietary machines made by Hewlett-Packard, Oracle, and Fujitsu to new Power7-based machines for so long it is hard to remember a time when it didn’t. The company is fussing with these deals all the time, so it is also hard to keep them straight. The last time this particular Power Systems Trade-In deal, which gives customers buying new Power7 iron a cash-rebate that ranges from a low of $250 on a PS700 blade server to a high of $120,000 on a loaded up Power 795, was tweaked was back in February, when it added in the new Power 710, 720, 730, and 740 Gen2 machines to the list of acquired machines. (These machines were launched in October 2011 and sport slightly faster Power7 CPUs and PCI-Express 2.0 peripheral slots.)

This time around, in announcement letter 312-063, IBM is juicing the deal for Power 770 buyers. Generally speaking, the trade-in rebates have been doubled compared to the levels they were at before this deal was tweaked on May 15. On certain smaller configurations of the Power 770s with relatively few cores activated, the rebates are almost three times as high, jumping from $750 to $2,000 on machines with from four to seven cores and from $1,250 to $3,000 on machines with eight to 15 cores. With this revision, the trade-ins for buyers of Power 770s now get from $2,000 to $40,000, depending on the configuration of the acquired machine.

This Power Systems trade-in deal sits beside a “spring cleaning” rebate that Big Blue revived in announcement letter 312-058 that is focused on the Power 770 and that gives customers rebates range from $6,500 to $35,000 and that works out to somewhere between 9.6 percent and 14.7 percent off list price for the raw processing capacity in the Power 770 for the configurations in the deal.

IBM i shops would probably love to see a deal sweetener like this for the Power 720, which is by far the most popular target acquisition for customers given their relatively small size. Particularly given the very sweet deal IBM is giving Linux shops with the PowerLinux machines and the intense pressure from Windows-X86 servers.