Re: Linux (see smaller server Iseries)

["Nathan M. Andelin" <nandelin@xxxxxxxxxxxxxxxxxxx>]

From: <thomas@inorbit.com>
> It's hard to imagine IBM foregoing a big bunch of profit from
> MVS (or z/OS or whatever) by offering Linux in its place. I suspect
> that the profit margin is reasonably similar and that the price
> difference reflects some actual costs, perhaps costs of ongoing
> maintenance and enhancement. Those costs might drop significantly
> with Linux allowing lower price per server.

It seems to me that market potential is driving IBM to support Linux.  Not
short term profit.  IBM wants market share.  After a new customer base is
established, or an existing customer base is shored-up, they will profit via
middleware.

Consider how IBM prices interactive features separately on the iSeries.  The
higher price has little to do with cost.  It's a value proposition.  The
value comes partly from legacy applications (ironically, which other people
write), partly from the cost of moving to other platforms (the lock-in
effect), and partly because of its efficiency in comparison to other
alternatives.

Most of my work in 1981-1987 was under MVS.  It hasn't changed that much
since then.  TSO, JCL, ISPF, CICS, IMS, DB2, etc :-)

Nathan M. Andelin
www.relational-data.com