Re: Fast400 Value to iSeries community is less than zero -- MIDRANGE-L

On Saturday 10 November 2001 12:06 pm, Nathan M. Andelin wrote:
> > My argument is that IBM did not "sell" a 500 CPW
> > machine and hobble it. A customer ordered a machine
> > capable of 50 CPW and received that.
>
> That's the standard IBM line.  But the properties of the machine are not
> defined by CFINT.  They're defined by hardware components.

Well, I'm not trying to describe what happened in the "legal" sense, only
what happened in the actual sense. Whenever I've been involved in the
purchase of an AS/400 the customer looked at the IBM performance ratings
for the models and the prices. A choice was made balancing those options.
Checking the processor options was primarily for the purpose of determining
IBM described upgrade paths and availability of options.

Perhaps you have been in different purchasing situations where people tried
to figure out how much "actual" CPW a processor was going to be capable of
when they modified it and bought a model based on that.

> If someone were bright enough, they could probably figure out a way of
> changing the configuration of the chip, or swap a low-speed clock for a
> high-speed clock, and thereby dramatically increase the performance of
their
> box.  Would there be anything wrong with that?

Wrong in what sense? Would it be illegal? I doubt it from what I've read
here. If hardware modifications cannot be licensed, then I doubt there is
any illegal problem here. I'm pretty sure it would invalidate IBM
maintenance, so that would only be "wrong" if the customer wanted IBM to
maintain the box.

> To answer that question, you need to go back to who owns the box, the
> customer or IBM.  If you buy a car and modify its engine to perform
better,
> is there any difference?

Well, I don't see the difference unless licensing is an option. But again,
even with the car, when you've modified it to suit your purposes the
manufacturer no longer warrents it, right?

> Actually somebody over in the MI list summarized a court case involving
IBM
> equipment.  A customer made some simple changes to their hardware and
viola,
> double the performance.  IBM argued the point that the customer needed to
> pay for the extra capacity, which was equivalent to their higher priced
> model.  IBM reportedly lost the case.

This anecdote doesn't really add value to this discussion. For one, you
don't seem to have any more certainty of its truth than I do. But the more
important question is what would happen if this were true?

The question you should ask yourself is "What will IBM do if this little
story is true?" If IBM has been using such means to maintain a profit and
they can no longer use those means, what will they do? Will they decide
that they've lost the battle and now they just have to go ahead and sell
their products at lower prices regardless of their profit or loss? Will
they just find some other way of protecting their margin? Will they just
discontinue the line of (without artificial protection) less profitable
hardware?

Is it worth it to your customers to modify the system in order to beat IBM
out of some revenue if this threatens the future viability of the platform?

> vendor, and generic to all sales.  People who have invested in IBM
equipment
> over a number of years can't be held hostage by IBM's interests.  They
have
> a right to be in business too.

They surely do. But you should keep in mind that IBM's interests and the
customers are parallel in some places. IBM wants to sell hardware at a
profit. The customer wants a cost effective solution to IT problems. If the
iSeries is a solution to both their problems, everyone's happy. But if the
iSeries cannot support a margin attractive enough for IBM to market it,
then the customer and IBM both have to look elsewhere for a solution.

> I don't like to be taking a position that's different than IBM's.  I sell
> only iSeries software and services.  I need the iSeries to be successful.
> But there's something slippery about using a program to burn cpu cycles.

Well, I understand the perception. Like the perception of tier pricing or
other such things. This seems to be just an awkward solution to a difficult
problem. One that may not make everyone happy on both sides, but that might
not really have a better choice waiting in the wings. By better, I mean one
that will make everyone happier than they are now.

> It would seem so much more strait forward if IBM were to stop saying that
> "interactive features" is hardware, and simple ask customers to pay for a
> 5250 license the way Citrix asks cusomers to pay for it's terminal
emulation
> software.

Well, I know that I've written some code that this would kick off the
iSeries. Just because I know I like to use the 5250 screen (its easy to
code to) and remove the heavy labor to server jobs. So I have some POS
stuff that would become a lot more expensive. Right now, those screens sit
around waiting for a sale most of the time.

> Nathan M. Andelin
> www.relational-data.com

--
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