IBM this week plans to launch its latest System z mainframe, expected to be the hub of Big Blue's system of systems plan for the data center.
On a conference call with analysts following the company's second quarter report, IBM CFO Mark Loughridge said:
System z revenue declined 24 percent year to year. This week IBM will announce the next generation of System z, the fastest and most scalable enterprise server in the industry. This server provides 40 percent more performance on a mix of workloads than the equivalent z10. Some workloads can achieve greater performance improvements such as Linux which has 60 percent better performance and 35 percent lower cost. This announcement is the foundation for IBM’s first System of Systems, which provides the capability to manage 10 times the virtual machines of VMWare by extending mainframe governance to our other industry leading technologies.
IBM's launch isn't unexpected. After all, rivals ranging from Oracle to HP have been pinging us for counterprogramming. The storylines proposed are all similar. IBM's mainframe is so 1964 and it's a joke as a next-gen private cloud player. Obviously, the attention paid to System z may warrant another look as IBM aims to reinvent the mainframe again. HP's Integrity competes with IBM's System z.
Meanwhile, the Oracle-IBM hardware war is picking up. Last week, Oracle held a financial analyst powwow to chat about Exadata. The call was more infomercial than educational, but it's clear that Oracle execs had IBM targeted. Andy Mendelsohn, senior vice president of Oracle database server and technologies group, said positioned Exadata as a building block for the next-gen data center, or private cloud. Mendelsohn added that 30 percent of Exadata buyers are acquiring multiple systems. "IBM doesn't have a strategic building block for a data center or private cloud," he said.
IBM wasn't going to let that Exadata chatter slide. Loughridge was pretty blunt about Big Blue's take-out Sun plan.
In second quarter we had 225 competitive UNIX displacements of which almost two-thirds were from Sun. This resulted in $225 million of business and nearly 4 points of share gain. This is a sequential increase of over $75 million from the first quarter where we gained over seven points of share. We have now won 620 deals from Sun totaling nearly $650 million over the last 6 quarters. The win rate has been increasing and we expect these take-outs to continue throughout the second half.
This quarter we will announce our Power7 entry and high-end systems with availability in September. Our high-end systems will scale up to 256 cores and are capable of running 1,000 virtual images, which is 4 times more than our current high-end Power6 processors. Additionally, the energy efficiency of these new high end systems will be five to seven times more efficient than the latest UNIX systems from both Sun and HP.
Get use to the sniping as hardware giants all aim for IT infrastructure buyers. Forrester Research on Monday released a report indicating that tech execs are looking beyond just keeping the lights on. If that's the case, these hardware giants have a big opportunity to juice sales.