Whenever I visit Las Vegas, it is quite amusing to listen how different “players” opine about beating the odds and winning big. I often hear tales of big winnings, but seldom do I hear about the other side where the participant may be contributing to the increased profits of the establishment. Is software pricing on the mainframe much different where “luck” may play a role in “contributing to increased profits of the establishment”?
Feeling Lucky
Let’s look at mainframe sub-capacity pricing which is based on the utilization of LPARs where the mainframe software executes. The pricing is based on the highest observed 4-hour rolling average utilization – which is fine if the workload is fairly predictable, but not if you have unexpected spikes in usage. If your usage spikes do drive up the “highest observed” 4 hour average, you are now paying more for ALL your software running in that LPAR. Has your marketing department ever failed to tell your IT group about a new promotion that would drive up compute resources? So - Are you feeling lucky?
OK - you’ve gone with Sub-capacity pricing, so you now have to run the Sub-Capacity Reporting Tool (SCRT) to collect mainframe SMF type 70 and type 89 records from every LPAR on the machine that runs z/OS at any time. You also have to send these SCRT reports to IBM each and every month…or risk being charged 100% of the capacity, regardless of the usage. This may require a dedicated resource just for reporting. So – does the potential savings justify the additional cost for a reporting resource? Does any other system vendor require a dedicated person to track system usage and billing? With any luck, the reports will be sent on time every single month…if not, then you are paying more.
Now let’s say you have bought in to the mainframe sub-capacity pricing scheme and made the switch, but now realize that the pricing was actually more advantageous under your old full capacity pricing methodology. You can move back – right? Wrong. “You may only convert full-capacity license entitlements to sub-capacity”. Again – I ask you “Are you feeling lucky?”
Back to my Vegas analogy where I only hear from people who have hit it big in their gambling pursuits. All you need to do is look around Las Vegas and see the over-the-top opulence to notice that the casinos are experts at profiting from a captive audience. Have you noticed that once you get in to the casinos, it is difficult to find your way out? Is it much different when about 40% of IBM’s profits are estimated to be driven from the mainframe hardware, software & services – from a relatively small number of remaining companies. Would that be considered “profiting from a captive audience”?
Jackpot
HP’s Instant On Enterprise supported by a Converged Infrastructure is a cost effective way to run mission critical workloads that enable choice to companies in an open system world. Since we often see 50%-70% TCO savings when helping companies modernize their applications move a mainframe to an HP platform – it’s like you’ve won the jackpot. See for yourself by visiting HP’s Mainframe TCO Challenge.
