CA, IBM troffer price breaks for OS/390

Computer Associates International and IBM recently announced a unified front in pricing, software-package development and support for the IBM OS/390 platform meant to appeal to mainframe users who are developing e-commerce applications.

The two companies are betting "OS/390 will become the e-business server of choice," said David Carlucci, general manager of the OS/390 division at IBM.

The pricing alignment for IBM's Multiprise 3000 Server will deeply cut costs for CA software, said Charles B. Wang, chairman and CEO of CA.

Educational Credit in St. Paul, Minn., has been outsourcing its data management but wants to resume internal operations. The student-loan guarantor will take delivery on one of IBM's new Multiprise machines at year's end. Mike Coleson, application manager at the company, said he has run the numbers, and the price CA is quoting for a Unicenter TNG and application package for OS/390 is "about half what I would have paid for the same package a month ago."

CA is offering another price break to companies migrating from the VSE to the OS/390 operating systems. During the transition - for up to three years - companies pay none of CA's VSE software licensing fees, said a CA spokesman.

"It's a bold approach," said Charlie Burns, an analyst at Giga Information Group in Houston. While mainframe hardware prices have dropped, software prices haven't. "People try to upgrade, and they save on the hardware, then get hit with millions of dollars of upgrade costs on the software," he said. The new e-business applications will further buttress a company's decision to stay with its mainframe environment, Burns said.

A typical mainframe operation looking at implementing e-commerce must choose to connect existing applications to the Web or go to a new platform and re-create and reinvent as much as 30-years' worth of business applications, he said.

IBM is taking a businesslike, hardware vendor's approach in striking an alliance with a direct competitor of its Tivoli Systems unit in Austin, Texas.

"There isn't a direct one-to-one relationship between" the software the companies offer, Carlucci said. "And many customers have already chosen their software."

Tivoli is also aggressively pursuing OS/390 users looking to e-commerce, issuing its own OS/390 management software and conducting a series of electronic-business management seminars, beginning last week in Boston.

Coleson said Tivoli representatives have called him to talk about their OS/390 tools. His company hasn't decided which management software it will use, but Tivoli's price is still higher, he said.

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