IBM responds to Neon Software mainframe lawsuit

IBM has responded to Neon Enterprise Software’s lawsuit claiming unfair competitive practices related to the mainframe, saying the company is encouraging its users to violate agreements with Big Blue.

IBM’s 37-page response is actually longer than Neon’s 24-page lawsuit, which was filed in Austin, Tex. District Court in December. Neon’s main claims were that IBM wasn’t playing fair by trying to limit competition and intimidating prospective Neon clients. The original suit stemmed from Neon’s zPrime software, which allows users to offload workloads from the mainframe’s central processors to specialty mainframe processors. This in itself isn’t unusual, but what zPrime does is allow users to offload more work to these specialty processors than IBM intended, which saves them money because software licensing rules that apply on the main processors don’t apply on the specialty ones.

In its lawsuit, Neon claimed that IBM’s unlawful actions could cost potential Neon customers more than $1 billion in software licensing fees.

IBM has now shot back, however, saying that the issue is really about Neon’s “attempted hijacking of IBM’s intellectual property.” IBM compared what Neon is doing to a “crafty technician who promises, for a fee, to rig your cable box so you can watch premium TV channels without paying the cable company. Even if it could be accomplished technically, it is neither lawful nor ethical.”

Big Blue isn’t stopping at defending its practices, however, which Neon called a “monopoly” in its original lawsuit. Instead, IBM is making counterclaims and asking the court not only to dismiss Neon’s claims, but also to force Neon to stop selling zPrime, give Neon’s zPrime profits to IBM, and award IBM any other damages that the court sees fit.

In part to ease this pricing pain and keep its customers from moving work off the mainframe, IBM introduced specialty processors such as the Integrated Facility for Linux (IFL), the System z Application Assist Processor (zAAP), and the System z Integrated Information Processor (zIIP). Though the specialty processors are the same physical hardware as the central processors, what IBM intended to have customers runs on each was different.

Big Blue’s intention was to allow some z/OS workloads - Linux, DB2, and Java - to move to these specialty processors, where software licensing was free. The processors have become popular among mainframers, in particular the IFL and zIIP. Meanwhile, IBM wanted mainframers to keep their legacy applications on z/OS on the central processors, where licensing fees were still huge.

Neon bucked those intentions. At the end of June, it announced its zPrime software, claiming that mainframers could offload more than just database and Java workloads to the zIIP and zAAP. And then the war of words began. IBM started warning customers that zPrime could cause mainframers to violate software agreements they had with IBM. Neon disagreed. The verbal back-and-forth continued for a few months. Now, it’s a legal back-and-forth.

CA names new CEO: Bill McCracken

CA’s board of directors has selected Bill McCracken as the company’s next CEO. McCracken has been serving as executive chairman of CA since John Swainson announced in September that he planned to retire by the end of 2009.

McCracken, 67, joined CA’s board of directors in 2005 and became non-executive chairman in 2007.  Prior to joining CA, McCracken held numerous executive positions at IBM during his 36-year tenure, most recently as a member of the Chairman’s Worldwide Management Council and general manager of IBM’s printing division.  He previously served as president of IBM’s EMEA and Asia PC Company and as general manager of marketing, sales and distribution for IBM PC Company.

Check out this video of McCracken in December talking about opportunities in clean technology.

At the same time, CA announced quarterly financial results, saying revenue had increased 8% over the same quarter last year. It said saw “significant” demand for its Mainframe 2.0 products, identity and access management software, and its CA Wily application performance management tools.

Mainframe revenue tanks

IBM announced its fourth-quarter results yesterday, and the bad news for the System z mainframe is that revenues tanked 27% from the fourth quarter of 2008.

According to the U.S. Security and Exchange Commission filing yesterday:

Revenues from System z mainframe server products decreased 27 percent compared with the year-ago period.  Total delivery of System z computing power, which is measured in MIPS (millions of instructions per second), decreased 19 percent.

 As you can see from the graphic above, System z was the worst performing hardware segment in IBM’s Systems and Technology Group.

The new mainframe, probably to be called the z11, is estimated to be out in the second half of this year.

Unplugging the mainframe at the House

The U.S. House of Representatives obviously wants to defend its decision to unplug its last mainframe, and so it has produced this video:

Neon Enterprise Software sues IBM over mainframe software practices

The battle between Neon Software and IBM over mainframe software practices, which has been escalating since early summer, has now hit the court system.

Neon Enterprise Software filed the 24-page lawsuit in U.S. District Court in Austin, Tex. yesterday, claiming unfair competition and intimidation of prospective clients for Neon. The suit stems from Neon’s zPrime software, which allows users to offload workloads from the mainframe’s central processors to specialty mainframe processors. This in itself isn’t unusual, but what zPrime does is allow users to offload more work to these specialty processors than IBM intended.

In its lawsuit, Neon claims that IBM’s unlawful actions could cost potential Neon customers more than $1 billion in software licensing fees.

Neon also throws around the word “monopoly” and “locked-in” in regards to IBM’s control of the mainframe market and mainframers’ reliance on IBM. There is no doubt that these statements tap into other complaints about IBM’s mainframe practices.

In particular, there were lawsuits by Platform Solutions Inc. (now owned by IBM) and T3 Technologies, which were selling plug-compatible mainframes that could run z/OS on Intel’s Itanium processor. IBM has essentially shut them down by not licensing z/OS for those alternative mainframes. In addition, the U.S. Justice Department is now investigating whether IBM owns a monopoly in the mainframe market.

Why does all this matter? Software licensing on the central processors (CP) is expensive. For large organizations, it costs millions of dollars per year.

In part to ease this pricing pain and keep its customers from moving work off the mainframe, IBM introduced specialty processors such as the Integrated Facility for Linux (IFL), the System z Application Assist Processor (zAAP), and the System z Integrated Information Processor (zIIP). Though the specialty processors are the same physical hardware as the central processors, what IBM intended to have customers runs on each was different.

Big Blue’s intention was to allow some z/OS workloads - Linux, DB2, and Java - to move to these specialty processors, where software licensing was free. The processors have become popular among mainframers, in particular the IFL and zIIP. Meanwhile, IBM wanted mainframers to keep their legacy applications on z/OS on the central processors, where licensing fees were still huge.

Neon bucked those intentions. At the end of June, it announced its zPrime software, claiming that mainframers could offload more than just database and Java workloads to the zIIP and zAAP. And then the war of words began. IBM started warning customers that zPrime could cause mainframers to violate software agreements they had with IBM. Neon disagreed. This back-and-forth continued for a few months until yesterday, when it appears Neon had had enough and filed the lawsuit.

IBM continues push of Linux on the System z mainframe

This week IBM continued pushing Linux on the System z mainframe, offering a Linux-based mainframethat comes pre-built with z/VM and other Linux-related features.

The starting price, for a Business Class machine with two IFLs, is $212,000 and ramps up from there.

The announcement is the latest of IBM’s System z Solution Editions, which it started pushing out late this summer and which already include bundled packages for disaster recovery, data warehousing, security and a few others. This one, for Linux, can be considered especially important considering IBM’s claim that almost half (3,000 of 6,300) unique applications on the System z mainframe are on Linux. It has clearly been a growth segment of the stagnant mainframe market, with zLinux growing 100% in the last two years, according to IBM.

The System z Solution Edition for Enterprise Linuxincludes from two to 64 Integrated Facility for Linux (IFL) processors, which are geared toward running Linux specifically, as well as memory, I/O connectivity, and the z/VM virtualization operating system that runs under Linux. All of this can go on either a z10 Enterprise (bigger) or Business (smaller) Class machine. The solution can include running Linux alongside z/OS or just Linux only. They include 3-5 years of hardware maintenance, 3-5 years of software support, and partnerships with Novell SUSE and Red Hat Linux distros.

More about the mainframe and cloud computing

James Governor, an analyst at Red Monk, writes about how major IT vendors are now pushing their consolidated architectures - what some might call unified computing - as great solutions for cloud computing. The only problem, Governor concludes, is that the mainframe has been doing this for decades.

Governor is not saying that the mainframe is necessarily a great cloud computing machine. In fact, he thinks that cloud computing is “definitely not a hardware story, except in as much as it fundamentally changes the way we consume system resources.” He brings this up to explain his disappointment at a recent EMC analyst event, where they were pushing the integration with CIsco and VMware as some boon to cloud computing, the foundations of which are so-called Vblocks.

But it wasn’t clear how enterprise compute purchasing is actually simplified with Vblocks. Frankly an enterprise could buy an IBM System z mainframe and it would be just like a Vblock- a fully-virtualised, pre-tested, pretested solution based on IBM software and gear. IBM doesn’t have a TotalStorage, System p and WebSphere coalition.

Compuware announces $1 million mainframe contest

Mainframe software provider Compuware is offering a $1 million prize to someone who best praises the company’s mainframe software.

The Detroit-based company is handing out free assessments to potential customers to determine what they think are the best ways to improve application and system performance.

The contest is open to all Compuware customers who maintain a software maintenance contract with the company through the process of the competition. Customers will be able to submit their stories online until Nov. 30, 2010. Compuware will then select the grand prize winner, which will get $1 million “cash,” as the company put it. There will also be nine runners-up who will get a $100,000 credit toward the purchase of a new software license from Compuware.

“Participants will be able to enter short stories about how Compuware’s mainframe solutions have saved them money or helped them avoid some kind of a problem,” said Rose Rowe, VP of mainframe strategy. “There is no limit to the number of stories. We would encourage employees of customers to submit as many and as often as they would like.”

The company didn’t have a link for me for submitting the stories, and I couldn’t find it going through the Compuware site. Hopefully they’ll have something up soon.

The current and future state of mainframe compliance

I recently spoke to Scott Crawford, managing research director for Boulder, Colo.-based analyst firm Enterprise Management Associates, about compliance on the mainframe. Here’s what he had to say.

Is compliance on the mainframe more of a challenge today than it has been in the past? Why?

I think it’s a question of perception more than anything else. The reason I say that is there has long been the perception that the mainframe is inherently secure. But security professionals shouldn’t think anything is inherently secure. A lot of benefits are based on how the mainframe is managed and administered. Now there’s the challenge of bringing in a new generation of professionals to manage the mainframe. What do they understand about mainframe security and access? How far is the mainframe really extended? How much mainframe functionality is integrated with applications that have high exposure?

Do you see mainframe applications being integrated with non-mainframe apps more frequently now, and maybe more haphazardly?

We have seen a number of system integrators whose primary business focus was integrating mainframe functionality through Web services. LPARs make is possible to host a Linux environment and a z/OS environment side-by-side. It’s also possible to host many common applications in that environment whose exposures are fairly well known. What the mainframe has going for it is a culture of disciplined control and disciplined management. Centralized control gives you benefits, but the risk has to be managed in such a way to get those benefits.

Is there a certain danger around people just assuming that the mainframe is secure?

There are a lot of assumptions around inherent reliability on the mainframe. A lot of security pros come from networking and distributed computing and not as much from the mainframe. They’re not as educated about the mainframe. Even a lot of the people trained as auditors might not have the skills to recognize risks in certain areas. In some case they might not know what they’re looking for, especially if they’re unfamiliar with the mainframe environment.

Is compliance on the mainframe harder than on distributed platforms? Why or why not?

Aspects of it are different as far as the underlying platform. You have to be knowledgeable of things like z/OS, RACF, and other products like (CA’s) Top Secret. You need to know things such as console operations and securing the console itself. But there is a lot that is alike. Securing a Linux host, for example. Those things are likely to be very similar. But the differences require special expertise.

Should IT shops with mainframe look to do compliance internally or just hire someone to do it for them?

Internally, companies need to realize that they need to make the generational transfer of knowledge and expertise. You need to manage the environment. This isn’t going to happen overnight. For external resources, you can turn to those providing tools, companies like IBM, CA and BMC, who have expertise.

IBM to stop selling z9 mainframe next June, “z11″ out 3Q 2010

In an announcement letter it put out today, IBM said it would withdraw the System z9 Business Class and Enterprise Class mainframe from marketing effective June 30.

The boilerplate:

On or after the effective dates for the withdrawal of these offerings, you can no longer order this product directly from IBM. However, IBM will continue to honor contracts until expiration or termination of the current contract.

As one mainframe listserv poster put it: “I thought June 2010 was a little early if the z11 isn’t going to be
available until Q4 2010, but to be honest I haven’t (paid) attention to the exact timing of past withdrawal announcements.”

Ian Bramley, managing director of IT analyst firm Software Strategies, said we can expect to see the z11 mainframes near the end of the third quarter of next year. Perhaps we’ll see them early in the third quarter, or maybe even the end of the second quarter, if IBM plans to pull the z9 off the market on June 30.

Bramley talked about some of the potential forthcoming details of the z11 mainframe, including the move from 65nm to 45nm processors that will run around 5GHz and have simultaneous multithreading, dual-threading and result in a 20-25% performance improvement.