RE: Re: slanted article "Inside System Storage -- by Tony Pearson"

Paul,

I love the mainframe too and have great respect for IBM. But I like to think
that those of us in the PCM industry made significant and valuable
contributions to mainframe technology as well, and weren't just "clone"
makers. Perhaps even more importantly, we helped to legitimize the IBM
mainframe as a de-facto industry standard which customers over the years
could confidently embrace and build upon as the IT foundation of their
business, but now find themselves beholden to a sole vendor. IBM is a great
company, but much of their enduring market power in high-end business
computing derives from their ironclad proprietary hold on a pervasive
industry standard. Many of the recent "innovations" in z/Architecture were
pioneered by others (64-bit addressing, more/wider registers, IEEE floating
point, relative branching, etc.). It endures more because of its incumbency
than leading-edge technological innovation. Which is not to say that
backward compatibility is not vitally important. It absolutely is, and the
most cost-effective way to provide long-term legacy compatibility is
emulation. But as long as it threatens a powerful incumbent, it will never
be fully embraced, no matter how nicely we ask. IBM and other corporations
are not evil. But they can be counted on to act in their own self-interest,
and justify it as their fiduciary duty to the shareholders all the way to
the bank. Antitrust enforcement has a legitimate role to play in maintaining
the free market and may be the only answer in this case.

Ron Hilton

-----Original Message-----
From: [email protected]
[mailto:[email protected]] On Behalf Of Paul Raulerson
Sent: Wednesday, September 22, 2010 9:01 PM
To: [email protected]
Subject: Re: [hercules-advocacy] Re: slanted article "Inside System Storage
-- by Tony Pearson"


On Sep 22, 2010, at 8:57 PM, ron.hilton wrote:

> Paul,
> 
> Here's a thought experiment to help determine whether IBM has a lock on
the
> market. Suppose that Dell decided to increase prices by a factor of 10,
what
> would happen? Customers would be able to switch to HP, Lenovo, or any of a
> number of PC-compatible hardware vendors with very little disruption, and
> Dell would go out of business.
> 
I see your point, but Dell's business is built on an entirely different
premise than IBM's.  Dell is setup to produce the lowest cost devices it
can, then market and deliver them to a  mass market audience with the lowest
overhead possible. 

IBM developed and paid for proprietary technology that is not "mass market"
by any definition.

That makes a difference, but does not invalidate your point. 

> Now suppose that IBM decided to increase
> mainframe pricing by a factor of 10, what would happen?
> 
The person making that decision would be immediately "retired" and his
successor would roll back the pricing. That's what a Board of Directors is
there for, to oversee the company and ensure that it remains healthy,
profitable, and ethical. 

Take a look at this board - these folks have integrity. 

http://www.ibm.com/investor/governance/board-of-directors.wss



> Well, a decade or
> more ago customers could have gone to a PCM such as Amdahl or Hitachi with
> little disruption.
> 
But they left the business when it became obvious that IBM no longer had to
cater to them per the consent decree. Those companies made money pretty much
only because IBM was not allowed to openly compete with them. 

And since then, IBM has provided so many innovations, z/OS, zSeries, and
dozens and dozens of products upgrades, it isn't even the same scene
anymore. 


> But that was then. Can you imagine the worldwide economic
> impact on large corporations and governments of a 10-fold increase in
their
> mainframe costs from their sole vendor, IBM? Even for the lucky minority
for
> whom a wholesale migration using LegacyJ or something like that might be
> feasible, they would still experience enormous disruption in the short
term.
> Of course IBM would not likely do that, because even a monopolist knows
> better than to charge more than the market will bear. But in the absence
of
> direct competition, the mainframe market is bearing a great deal more than
> when the PCMs were in business. And the even more cost-effective,
innovative
> emulation-based technology has been denied to mainframe customers.
> 
> 
I would content that "lucky minority" is more like an "overwhelming
majority", but that's opinion. :) 

This discussion is really taking an odd turn, because I am usually arguing
on the other side of this issue. Often with anyone at IBM whose ear comes
within chewing distance.  However, I really love Hercules. And I want to 
see it totally legitimated, and totally accepted in the mainframe world. 

I just do not see that happening by the community being so negative to IBM.
It reminds me of a teenage going on about how UNFAIR it all is. Usually
because he is being made to complete his chores before an allowance or
special privilege is granted. 

This is very much a similar situation - we want big daddy IBM to give us
something, and we are acting rather obnoxious about it. Look at some of the
comments about IBM in this thread, and check the words that were used. 
They are not very polite. 

For heavens sake, we should be advocating everything amazing and good about
Hercules - not deriding IBM. 

I will point out that just about everything I love about mainframes - the
hardware, the software, the history, is thanks to efforts by IBM.  Almost
everything that is - lots of other stuff I love too. Hercules for instance.
Linux, 
Dave River's and Co. Assembler, SHARE, and more. But NONE of it, not one
thing, would exist if IBM had not put the company on the line half a century
ago, and developed the thing. And most of it would not exist if they had not
kept investing in it, and selling it, and making it better and better and
better. 

So let me turn the question around -  what can we do with Hercules that
would:
(1) Allow IBM to remain in control of their products and brands?
(2) Encourage or enable research or development into mainframe subjects?
(3) Decrease internal costs of mainframe support and training?
(4) Encourage widespread but controlled development of new mainframe
software
(5) Encourage or enable the use of Linux on mainframes
(6) Enable embedded mainframe programs in very small devices? 
(7) ????
(8) ????

That's the kind of stuff we should be showing and advocating. That's the
kind of stuff I believe will get us where we want to go. 

-Paul


> Ron Hilton
> 
> -----Original Message-----
> From: [email protected]
> [mailto:[email protected]] On Behalf Of Paul Raulerson
> Sent: Wednesday, September 22, 2010 5:39 PM
> To: [email protected]
> Subject: Re: [hercules-advocacy] Re: slanted article "Inside System
Storage
> -- by Tony Pearson"
> 
> On Sep 22, 2010, at 7:21 AM, Roger Bowler wrote:
> 
> > On Wednesday, September 22, 2010 Paul Raulerson wrote:
> > > Believe it or not, IBM *does* have a point about protecting IP that
> > > they spent *billions* of dollars to develop. MVS alone cost about a
> > > *billion* dollars to develop. I have no idea how much more money has
> > > been put out iby IBM for development and support of OS390, z/OS, VM,
> > > z/VM, CICS/Transaction Server, DB2, and all the other products
> > > around.
> > 
> > More to the point is where did that R&D money come from. IBM didn't
> > just conjure it up out of thin air. It came from sales of mainframe
> > systems to banks, airlines, utility companies, and government
> > departments. And where does their money come from? It comes from you
> > and me. Over the last 40 years IBM has been paid vast amounts of money
> > by all of us to help develop an IT infrastructure on which our modern
> > society now depends.
> > 
> The R&D money came primarily from customers yes. Customers who
> believed they got fair value for their money when they spent it. Certainly
> all the companies I know that run on mainframe hardware are quite 
> realistic, and even hardnosed about their IT budgets. They spend what they
> spend because they realize profit from their mainframe operations, one
> way or another. 
> 
> Unless those customers are shareholders in IBM as well, then they have
very
> little indeed to say about how those profits are spent. 
> 
> And IBM's decisions to put profits back into R&D was a wise move indeed.
> Look at the internally developed patent portfolio. It can be argued that
> along with AT&T,
> IBM has contributed more technology discoveries that the rest of the
planet
> combined.
> Don't know if that is precisely true or not, but I have heard it bandied
> about more than once.
> 
> > 
> > And let's not forget that the mainframe ecosphere does not consist
> > solely of IBM hardware and software. As well as an enormous range of
> > third party products, the viability of the mainframe depends most
> > importantly on the existence of the 20 trillion dollars worth of
> > customer-developed applications which IBM is so proud of (see
> > http://www.ibm.com/software/htp/tpf/tpfug/tgf02/tgf02x.pdf slide 5)
> > Who paid for those COBOL applications and the IT infrastructure that's
> > built around them? Not IBM, and yet IBM now seeks to retain a monopoly
> > on reaping the rewards from this massive customer investment. A
> > customer investment which dwarfs IBM's claimed R&D expenditure.
> > 
> > 
> 
> What customer investment? Are you saying IBM owns the COBOL programs 
> developed by say, Nationwide? Or mine?! 
> 
> I'm not sure what your point is here. People and companies paid for those 
> programs and infrastructures - and those same people and companies own
them.
> 
> The same is true for companies that build around Unix, VAXen, or even PCs.

> 
> > The real question is, should the customers, who have invested so much
> > in legacy applications, be obliged to continue to pay through the nose
> > to contribute to IBM's profits, or should they have a choice about
> > where they run their legacy applications? I stress, these are customer
> > applications we are talking about, they are not IBM's. Many mainframe
> > customers continue to be happy with IBM quality and are willing to pay
> > a premium for that. That is fine, and that is free competition. But
> > the flip side is that many customers are seeking alternative
> > solutions, not necessary for their core applications but for a variety
> > of reasons including disaster recovery, testing, training, "sunset
> > applications" which must be kept running for regulatory reasons, and
> > which do not need the latest IBM System z to run on. These are the
> > areas in which IBM is using its monopoly position to exclude customer
> > choice.
> > 
> > 
> 
> If you want to run on IBM hardware, then yes, you are obliged to pay IBM. 
> If you want to run IBM licensed software, and IBM demands a license fee,
> then yes,
> you are again obliged to pay IBM for the privilege. 
> 
> If you want to run IBM software on non-IBM hardware, then you are
> obliged to negotiate with IBM for the right to do so. That's the whole
point
> isn't it? 
> 
> And no mainframe shop is locked to the mainframe platform, especially
shops
> whose applications are primarily in COBOL or Fortran. My shop uses a lot
of
> assembler, 
> so we are tied pretty tightly to mainframes, but then, we can use Hercules
> to run z/Linux,
> and our applications, even the assembler ones, will run on top of that. 
> 
> But Oracle/Sun for instance, offers a CICS like transaction platform
> designed to 
> run Mainframe CICS programs, with a suitable re-compile. 
> 
> My buddy Dan Meyers, is the CEO of Legacyj - and he will sell you a COBOL
> compiler that will compile and run your COBOL and CICS programs on a
> Windows, Linux, or other platform. It works very well too. Indeed, he will
> even sell the serives to port your programs off to the platform of your
> choice. (I have no financial interest in Legacyj, I just like it.) 
> 
> There are at least a dozen other choices for porting and running mainframe
> apps on non-mainframe platforms. Nobody is really locked into the
mainframe.
> 
> Now, grant you, I love our mainframe, not the least because the lovely
> little box never breaks, and works and works and works and works.
> 
> I also want to see Hercules mainstream. 
> 
> But blaming IBM because people bought their superb products? Doesn't that
> seem a little silly to you? 
> 
> > The billions of R&D spent on System z is a red herring. I've no doubt
> > that System z has some marvellous technology inside it, but that is
> > not the point. Hercules does not have access to that technology and
> > does not copy it. What Hercules does provide is an independently
> > developed alternative platform capable of running customer's legacy
> > applications. And in a free market the customer should be able to
> > choose whether he wants to run his applications on System z or a
> > lower-priced alternative.
> > 
> > 
> In a truly free market, IBM would also be free to choose to whom, and how
> and when it
> sells it's hardware and software, without reservation. That certainly
isn't
> true, though it has certainly
> been more so since the consent decree expired. 
> 
> We might not like it, but either you want a free market, or not. If you
do,
> then you have to realize that IBM holds the moral high ground here, and we
> are the supplicants asking for a boon. 
> 
> > --
> > Regards,
> > Roger Bowler
> > http://perso.wanadoo.fr/rbowler
> > Hercules "I can't believe it's not a mainframe!"
> > 
> > 
> 
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