OK, here we go. Many were wondering what IBM’s reaction to the Neon zPrime software would be. As you may know, the purpose of zPrime is to offload work from a mainframe’s central processors to specialty engines such as the zIIP and zAAP, saving on software costs and possibly delaying a multimillion-dollar mainframe upgrade. What Neon claims is that zPrime can offload a lot more than just DB2 and Java workloads, which is what the zIIP and zAAP are aimed at, respectively. One beta customer said they could save $10 million a year using zPrime.
Initially, IBM had no response, saying it needed to look into the product first. Neon was also being coy, not releasing any pricing on their product even though it is supposedly in general availability.
Now IBM is warning its mainframe customers.
In a letter dated July 10 and addressed to a generic client, IBM restates that it is trying to learn more information about the product “and how it is supposed to work, but the vendor has not yet offered to provide IBM with any detailed information and seems to be restricting access to such information.” Though I’m not positive about what “restricting information” means, I heard from a reliable source that a Neon Webcast last week on zPrime wasn’t allowing IBMers to register. The letter continues:
In general, any product which is designed to cause additional workloads, not designated by IBM or other (software) providers as eligible to run on the Specialty Engines, to nevertheless to be routed to a Specialty Engine should be evaluated to determine whether installation and use of such a product would violate, among other things, the IBM Customer Agreement (for instance, Section 4 regarding authorized use of IBM program products such as z/OS) and/or the license governing use of the IBM “Licensed Internal Code” (frequently referred to as “LIC”) running on IBM System z servers, or license agreements with any third party software providers.
IBM would also caution its customers regarding any claimed ability to reduce IBM Program license charges by off-loading workloads to Specialty Engines beyond the eligible workload identified by IBM. IBM’s applicable pricing terms governing Eligible Workloads on zIIPs and zAAPs will not apply to zIIPs and zAAPs running anything other than IBM specified eligible workloads. Therefore, customers should not anticipate any reduction (and may actually experience an increase) in the IBM Program License Charges associated with non-Eligible Workloads which may be off-loaded to IBM Specialty Engines, since the non-Eligible Workload running on the Specialty Engine will cause the software running on the Specialty Engine to be chargeable. IBM cannot comment on the potential impact on the software charges from other third party software providers.
So what will happen next? Will IBM still try to work with Neon to make this product a viable one for reducing mainframe costs? Will the negotiations turn contentious, possibly resulting in lawsuits and/or an acquisition, as was the case with Platform Solutions Inc. (PSI)? Rich Ptak, an analyst with Ptak, Noel & Associates, gave his opinion on the two sides of the coin.
“It could provide [IBM with] the significant opportunity to reinforce the message that the mainframe can be a very attractive workload platform,” he said. “It could really go to the heart of the challenge today that HP and Microsoft and distributed folks make about moving off the mainframe. They could also just as easily decide that they’ll just start including MIPS [million instructions per second] on the specialty engines in their pricing. To me, in many ways, that would be self-defeating.”
I discovered this IBM letter through DataDirect, another mainframe software vendor that sells a product for offloading work to the zIIP. Neither IBM nor Neon Software got back to me yesterday for an interview.