Computer Associates International Inc. and IBM today announced a collaboration in pricing, software-package development and support for the IBM OS/390 platform.
The two companies are betting that "OS/390 will become the e-business server of choice," said David Carlucci, general manager for the S/390 division at IBM.
The pricing alignment for IBM's Multiprise 3000 Server will deeply cut CA software costs, said Charles B.Wang, CA chairman and chief executive officer (CEO).
Educational Credit Corp. in St. Paul, Minneapolis, has been outsourcing its data management but seeks to resume operations internally; it will take delivery on one of IBM's new Multiprise machines at year's end. Mike Coleson, application manager for the student-loan guarantor, 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," he said.
CA is offering another price break to companies migrating from the VSE to 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 Inc. in Houston. While mainframe hardware prices have dropped, software prices haven't, he said. "People try to upgrade, and they save on the hardware, then get hit with millions of dollars of upgrade costs on the software, and they're like, 'whoa,' " he said.
The new e-business applications will further buttress a company's decision to stay with its mainframe environment, Burns predicted.
A typical mainframe operation looking at implementing e-business must choose to connect existing applications to the Web or go to a new platform and recreate and reinvent as much as 30-years' worth of business applications, he said.
IBM is taking a business-like, hardware vendor's approach in striking an alliance with a direct competitor of its own Tivoli Systems Inc. in Austin, Texas.
"There isn't a direct one-to-one relationship between what" software the companies offer, Carlucci said. "And many customers have already chosen their software."
Tivoli is also aggressively pursuing e-business and OS/390 users, issuing its own OS/390 management software and conducting a series of e-business management seminars, beginning today in Boston.
Coleson said Tivoli representatives have called him to talk about their OS/390 tools. His company hasn't yet decided on which management software it will use.But, he said, "we're already familiar with CA software because our service provider uses it, and the Tivoli pricing is still a little higher than CA's."