Enterprise 2013: IBM, System z, Power and Transaction Evolution

By Charles King, Pund-IT, Inc.  October 30, 2013

IBM’s recent Enterprise 2013 conference in Orlando, Florida, was the company’s Systems and Technology Group’s (STG) inaugural event focusing on CIOs, partners and IT practitioners—data center admins and managers—who work with IBM’s System z mainframe and Power Systems platforms.

In a strong sense, these groups represent the company’s core IT and business constituencies. With the IBM mainframe’s 50th anniversary just around the corner (in April 2014), the company is the only U.S. IT vendor still building these solutions, and System z constitutes more than 90% of the global mainframe market. IBM’s Power Systems owns well over half of the market for enterprise Unix/Linux solutions, a position that neither of its chief competitors (Oracle/Sun and HP) seems ready or willing, let alone able, to challenge.

Stick with the Old but Bring in the New

But at the same time, those critical IBM markets are under pressure. While sales of mainframe MIPS (millions of instructions per second—a benchmark for System z solutions) continue to be up year over year, revenues have lagged. In other words, the company is selling more and more mainframe capacity but at lower cost and margin. Similarly, sales of Power Systems and competitors’ platforms have fallen as customers move traditional Unix workloads and applications to x86-based servers and alternative solutions, including cloud computing services.

So while Enterprise 2013 featured a wide range of System z and Power Systems technical sessions, the conference also focused a great deal of time and attention on highlighting mainframe and Power capabilities in emerging cloud, big data/analytics and security scenarios. For those of us who follow IBM on a regular basis, this was old news—the company has long espoused the value its traditional enterprise platforms represent in these new/emerging markets.

In fact, some might argue that IBM’s messaging around virtualization and cloud sometimes escalates from vociferousness to stridency, and thus plays into competitors’ hands, but the stakes couldn’t be higher. Despite all its focus on and achievements in developing and delivering innovation, the IT industry tends to be easily distracted by shiny new things and queasily willing to abandon tradition without a backward glance.

So it behooves vendors of deeply-established technologies, like IBM, to clearly define the continuing, growing value of those solutions to the people who matter most—the data center professionals whose lives are touched and careers depend on the company’s System z and Power Systems every day.

IBM’s Transaction Leadership

Many would argue—emphatically and mostly correctly—that mainframe and Unix platforms represent the epitome of enterprise transactional computing. As IBM executives noted at Enterprise 2013, System z solutions occupy crucial data center positions in 90 percent of Fortune 500 companies and are the preferred backend systems for a large majority of banks, credit card companies and financial services firms. Its robust capabilities have made Power Systems the leading platform for enterprise databases, including Oracle and IBM’s DB2, and related data warehouse, business intelligence and analytics applications.

That’s all to the good, but do either or both deserve the strategic repositioning for emerging cloud, big data/analytics and security workloads? Absolutely.

System z and Power offer highly robust and scalable virtualization, pooling and management features that are core to cloud computing functionalities and services. Both IBM platforms support muscular analytics solutions and can be leveraged in numerous big data scenarios. IBM System z’s unequaled position in the financial services sector and in public sector agencies, including the Internal Revenue Service and Social Security Administration, serve as testimony to its security capabilities.

Transactional Evolution

But at Enterprise 2013, we were struck by the benefits both platforms offer for emerging applications and workloads in these areas. The fact is that businesses and business IT are in the midst of what might be called a transactional sea change. As more and more companies and the processes and services they use move online and onto mobile platforms, business relationships and activities are becoming increasingly abstract.

Signs of these changes are everywhere, from expanding volumes of Internet-based retail sales to the ramping revenues of online and mobile advertising to the growing importance of social networking-enabled customer business ratings and complaints. As companies move from bricks to clicks and face-to-face dealings become less and less common, transactions will reflect and even come to represent core business relationships.

One should add “For good or ill” to that last statement, because if any core transaction computing characteristics—speed, accuracy, reliability, security—falter or fail outright, the processes they support suffer, the relationships they represent are damaged and the organizations that employ them face serious consequences to their reputations and brands.

With the stakes so high, why shouldn’t organizations employ deeply-established, long-tested transaction platforms like IBM’s System z and Power Systems? More to the point, with the stakes so high, why should they trust lesser known or less able solutions?

Final Analysis

Like other largely technical IT conferences, Enterprise 2013 was designed to educate data center managers and administrators and address the questions they posed about the IT platforms and solutions they use every day. But IBM STG also pursued another, significant goal during the conference—to get attendees to begin thinking differently about the company’s enterprise solutions.

While System z and Power System offerings continue to reliably support the applications and workloads they always have, the platforms are also well-suited for use in emerging cloud, big data/analytics and security. In fact, given the evolving nature of business IT, especially in sustaining and enhancing business relationships, it seems entirely reasonable to believe that what is old in IBM System z and Power Systems transaction computing could well become new again.

© 2013 Pund-IT, Inc. All rights reserved.