Re: Fast400 Value to iSeries community is less than zero

[Chris Rehm <javadisciple@xxxxxxxxxxxxx>]

On Thursday 08 November 2001 09:33 am, Don wrote:

> Justifying to people that they're paying PREMIUM pricing for a machine
> that they'll not be able to use all that they're paying for is getting to
> be alot harder in the real world...

Well, Don, I think you are comparing apples and oranges to make your case.

But the bottom line of it is that IBM has costs associated with providing
the iSeries platform. If there is no market justification for them, then
why have the system at all? If your customer sees no benefit from having
the iSeries features, why would you want them to buy it?

If, on the other hand, the facilities and reliability of the iSeries
platform provide function above the level of the Wintel platform (or *nix
platforms) then what is the crime in IBM charging for that? It's not like
they get it free out of the ether, they actually do employ people to
develop the platform.

Now, there might be justification in being upset that IBM charges too much
for the iSeries. I haven't seen the figures of late, but I sure know they
used to have a very high margin in the AS/400 arena. I'd like to see lower
prices myself. But the pricing of models with a CFINT governor is just a
method IBM uses to maintain a revenue stream for a product that they are
selling.

What is the difference to your customer between IBM controlling CFINT with
a governor or IBM actually manufacturing boxes with different levels of
processor performance and physical limitation? If you went out and bought a
50 CPW machine then, you wouldn't be upset that it only handled 50 CPW,
right? Would it be possible then to get down to the real issue of whether
or not the features are worth the money they are being charged for?

So, ignore the fact that the method used by IBM to sell CPW includes a
governor to manage the level. That is really irrelevant. Your customer buys
a level of CPW. The question is, "Is it worth it?"

While the iSeries TCO is still lower than the TCO of other platforms, then
it appears to still be worth it. If that changes, IBM has to decide if they
want to lower the price or drop the product.

I do not personally see how IBM would be able to maintain the level of R&D
the iSeries needs if they were to just sell it on the same commodity level
of the Wintel boxes. I'd love to buy iSeries at the same cost as a Dell,
but I just don't know how that would work.

> Don in DC

--
Chris Rehm
javadisciple@earthlink.net

And thou shalt love the Lord thy God with all thy heart...
...Thou shalt love thy neighbor as thyself. There is none other
commandment greater than these. Mark 12:30-31