Re: Midrange Computing is liquidating.

>> Revenue (not profit):
>> OS/400 software   $350M
>> AS/400 hardware  $1,500M

>> No $ 10 B

The other premise that can be questioned is whether the split between 'OS/400'
software and the rest of IBM software is correct, as well as the division of
hardware. Much IBM accounting goes on to determine what the charges are between
groups, and what the credits are...  For example, if an AS/400 shop buys 10
seats of VisualAge for Java, does that count as AS/400 software? And how much
UDB development is charged back to the AS/400 platform?

I'm not making any claims here, but it *could* be that the downward trend was
created by charging more and more expenses from other groups against the AS/400
group.  And it *could* be that software group is now claiming some of the base
AS/400 income because of WebSphere, UDB, and other components that are sold as
part of OS/400.  Similar accounting games could be played with the hardware.

LOTS of questions need to be asked and answered before final conclusions can be
reached...

What IS clear to me is that IBM would be happier with us if we started to think
of ourselves as eServer owners, rather than as an AS/400 or iSeries community.
One fact I am confident of is that the iSeries eServer has a wider, more
complete application base available for it than any other eServer platform,
partly because it is getting so good at hosting non-native applications. And
MANY of those applications have competitive interfaces, even though many still
have their business logic in RPG or COBOL. Our system is far, far from dead!

If you haven't signed up to attend COMMON in Minneapolis in October
(www.common.org), please THINK now about joining thousands of other citizens
from the iSeries Nation for a celebration of just how far we've come!

Janet Krueger
Andrews Consulting Group


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