Maxed Out

Because the System i can run at redline speed all day long . . .

September 25, 2007

Two Minutes with Kevin Fratzke on IBM's Reorg

I connected with Kevin Fratzke, vice president of the iSeries Solutions Practice for MSI Systems Integrators, and asked him about his thoughts on IBM's reorganization -- the new Business Systems unit and the Power Systems unit. Here's a quick Q&A:

CM: Does IBM's change make sense to you? Does the rationale behind it, as publicly stated, that IBM's very large System i customers are very different from IBM's smaller System i customers, appear to reflect the real world?

KF: Yes, this change makes sense to us. For several years, we have been wondering when IBM would make a change like this. The customers are different from several perspectives -- smaller customers tend to stick with ISV packaged solutions with less customization around them. Also, the technical skills and investments required to sell to these two customer bases, from an IBM Business Partner's perspective, are very different.

CM: About the possible ramifications of this change -- what areas do you think have the potential to become much better or worse?

KF: I think IBM's exposure is that fewer traditional business partners may market to the Business Systems space, leaving IBM to rely more on the ISVs packaging hardware with their software.

CM: Can you elaborate just a bit? Meaning, an ISV would create a bundle with IBM hardware and then sell the package -- both hardware and software?

KF: Yes, I think IBM will have to rely on more ISVs bundling hardware with their solution to be effective in this space -- either by signing more ISVs as resellers or having traditional partners reach out and partner with the ISVs via the Value Net Solutions Provider (VNSP) program, which allows traditional partners to sell through ISVs to create a total solution. The challenge here is that most ISVs are not primarily interested in hardware, so once it's installed, it's hard to keep people focused on keeping the hardware current. This is why the teaming with traditional partners (via VNSP) is a better option in my view.

CM: How does this change affect MSI's approach to the System i market?

KF: No change yet, but we are looking at several scenarios. We want to give the IBM change some time to mature before we align with it. I would expect we might make some changes at calendar year end or at our fiscal year end in June of 2008.

CM: Oh, one more thing: are you seeing any other particularly hot topics of interest these days?

KF: Right now it's WebQuery replacing Query/400 and trying to figure out where it will really play and what adoption rate we will see.

Posted by cmaxcer at September 25, 2007 8:24 AM

Comments

Chris, why are you interviewing companies that are still not supporting IBM with its current server line?

MSI has an "iSeries Solution practice" - iSeries has not been sold by IBM for over 20 months now. And Query/400 has not been sold since V5R1. These vendors are taking the System i to customers, presenting it as the old stuff, and not promoting the future of our platform.

When you interview companies with this backward thinking approach, it appears that we continue to promote System i = AS/400 = "out of date".

Just checking - it seems that our community is passive, passionless and lack caring about the future. While you personally continue to use the System i brand name, talking to people who don't use System i seems to advertise our legacy, not our future.

Trevor

[*Note From Chris: Trevor, you make a good point. Many long-time AS/400-iSeries pros have a hard time making the transition in everyday speaking. Some, I think, continue using "iSeries" because that's still a dominant term of language (and identity) in some circles. Some guys will ask me to change their quotes to Sytem i if they accidently slip to iSeries or "400" in the heat of the moment. Either way, your point brings up the issue of choosing to be a leader in this area -- even if you're not on board with IBM's naming schemes -- because IBM isn't going to revert to iSeries. Half the posts to this blog still use iSeries, and half of those don't bother to punctuate it with a capital S -- as in, iseries -- and sometimes they actually mean the iSeries and not a System i. As for MSI, the company uses System i predominatly on its forward-facing Web pages, though it does put a "(iSeries)" along side System i often enough. As for us, we try to use the official IBM names for products more often than not, but it can get awkward trying to cut to the chase and not have to explain that this new XYZ is the replacement to the ZYX that will take people years to stop calling ZYX. Either way, I could work a little harder at being a System i usage advocate -- because, as you suggest, letting it slide doesn't help our System i world much.]

Posted by: at September 25, 2007 3:11 PM

It's a sad day when we find ourselves focusing on the name of the platform rather than on its technical capabilities or business solutions, yet this is where IBM has left us. Nothing can be done about the box's ridiculous nomenclature history, but what IBM can do is to promise absolutely that the name will never, ever be changed again.

Posted by: Ken Burton at September 26, 2007 6:26 AM

"That which we call a rose by any other name would smell as sweet" (Shakespeare)... Give me a S/38 programmer today and I'll give you a System i coder tomorrow.

Posted by: reid at September 26, 2007 6:46 AM

"...Either way, I could work a little harder at being a System i usage advocate -- because, as you suggest, letting it slide doesn't help our System i world much. ..."

If this is a matter up for voting, I would rather have SystemiNetwork correspondents focus attention on IBM's continued under investment in its products.

Over the next 6 months MSFT is releasing an improved server OS, a better IIS web server, a new SQL Server release, WPF (a programming framework that merges web with desktop programming), LINQ (language integrated query - a way to use SQL-like coding constructs with data collections not stored in a database), WF (flowchart programming), significant improvements to the C# and VB programming languages. Intel and AMD release more powerful processors every month.

How does IBM's investment in core software and hardware technologies compare to the competition? My guess is IBM spends a fraction of what Intel, AMD and Microsoft spend on R&D.

-Steve

Posted by: steve richter at September 26, 2007 10:51 AM

What's really sad is the IBM has been browbeaten by the press into coninually renaming its platform, and in the process has squandered billions of dollars in brand value.

I just got a new 515, it is a screamer of an AS/400, and like a true AS/400, it will never break, and always be reliable.

The marketing people at IBM are like a bunch of teenagers ashamed to be seen with their parents.

If every time you add a feature to the system you are going to rename it, we would be ready for constant renames.

I propose I I I Series next, then AS/I then Series/400 then I/400, then 400/i/400 then 400/i/Series, then Gooblamakia (just for something different).

[*Note From Chris: Brad, Gooblamakia is my middle name! Ah man, you've got me rolling on the floor laughing here . . . that's just funny in a painful way.]

Posted by: Brad Jensen at September 27, 2007 3:34 PM

Steve,

All I can say to your last post is Amen.

The $10 million question off course is, 'Did IBM already pull the switch on the System i product line?' They won't tell us, but the writing on the wall is becoming clearer every day. Let's take a closer look at the System i merchandising. On the hardware front, the System i users are being milked for their last penny (what IBM calls legacy revenue), and in return they receive a throttled down CPU and outdated hardware (remember the days we all struggled with tape storage and token ring networks while the rest of the IT industry used CD's and ethernet, even today, most System i disks are 18GB or 36GB while a laptop or desktop today commonly has 250GB.

On the software front, it's an equal sad story. WDSC, licensing, infocenter ... all outdated and overpriced stuff. The new Notes release runs on DB2 (PC or mainframe), but not on System i DB2 ... anyway the list of hints for the future of System i is endless.

And on top of that, Windows Server 2008! Windows Server 2003 already gave a big blow to OS/400 when it captured the SMB market for up to 500+ user installations. Maybe Windows 2008 is considered reliable enough to serve up to 5000 users.... Poor IBM, or more precisely, poor Rochester. Let them live on peacefully in their ivory tower where they can put together a new blade System i. But dear engineers, remember the good old IBM tradition, make the hardware weigh at least 500 pounds. The more iron used, the higher the sales figures will be!

Posted by: ugeerts at September 27, 2007 3:37 PM

Cheers to Steve: "If this is a matter up for voting, I would rather have SystemiNetwork correspondents focus attention on IBM's continued under investment in its products."

Chris, stop doing softball interviews such as you did with Kevin Fratzke on the IBM reorg. I think that the "reorg" is a bunch of "Sound and Fury signifying nothing."

Substantive initiatives or the lack of them is of interest to me. The glacial pace of IBM's progress compared to the high-energy ferment going all around me with Microsoft products such as VB.NET, SQL-2005, and VS is unacceptable.

Chris, your slip in saying the word, "iSeries" points to the underlying causes of the seven quarters of steadily and rapidly declining revenue. It is yoked with balky and incomplete products such as WDSc 7.0 and so forth.

I am looking forward to rapid progress and correspondents such as you putting the heat on IBM to get it done.

--John deCoville

Posted by: John deCoville at September 27, 2007 4:19 PM

Steve, don't "guess"........

MSFT 10K:R&D=$6.18 billion ?? patents,
IBM 10K: R&D=$5-6 billion 3,621 patents,
Intel 10K: R&D=$5.1 billion 1,959 patents,
AMD 10K: R&D=$1.144 billion ?? patents.

Different businesses, different investment streams, different "visible" results.

Posted by: Chuck at September 27, 2007 4:43 PM

Hey guys,

Any guesses when i5/OS will be renamed ... in light of the fact that we will soon be running POWER 6 processors?

I'm an IBM stockholder and am cringing in anticipation of the costs of that name change.

Whoever the genius was who thought to rename an operating system after the then-current generation processor model should be shot!

I do understand and support the strategy of defining the "server families" with different initials ... especially in recognition of the fact that IBM is now a "server company". The problem sounds like there were too many "newly minted MBA's" in marketing positions with no sense of history ... while we "seasoned MBA's", who know better, are sitting on the sidelines.

I think that you would be shocked to know how much IBM spends on R&D. Unfortunately much of that is on "basic research" where there is no short-term product impact. The real issue is how much of the product of that R&D makes it to the marketplace as an IBM-branded product.

No wonder IBM Services has become the largest and, I suspect, most profitable part of IBM!

Posted by: John Myers at September 28, 2007 10:11 AM

I don't know if it still holds true, but it was not that long ago that IBM was the world's largest investor in R&D -- in fact, they spent more on R&D than all their competitors combined. (Back in the 1980s they spent more on R&D than the others took in in revenue. They're still awarded more patents than anyone. That doesn't happen without investment in R&D. It would be interesting to hear where the various companies rank today.

Before we laud Microsoft for all their investment in software, it can be interesting to look at their track record. A few years back when the Trustworthy Computing Initiative was announced, Bill Gates said it was the company's number one priority. Now I haven't checked the last year or two, but for the first couple of years I surveyed their security bulletins. It was a very low percentage that were possibly discovered by Microsoft. I say "possibly" because Microsoft's policy is to only give credit for a security bulletin when their prescribed process for vulnerability disclosure is followed. If a company has so many billions of cash available and 14,000 developers available and they really want to make security the number one priority, I would think they could do a little more digging into their code and find a higher percentage of their vulnerabilities themselves.

That said, I too, would enjoy seeing a higher investment in the System i platform. IBM had a great advertising campaign for the system (Ted, I believe, with Gil and the gang), but no one thinks of the System i when you see the ads anymore.

You think of blades, storage, network management, etc. I still love the tag line from the laughing boardroom ads. "Someday, all computers will be built this way." That's a slogan I like to pair with my i.

Posted by: Michael Quigley at September 28, 2007 11:04 AM

IMHO, naming is one area that IBM can improve upon. System i, System p, System z, etc. sound like names given by engineers. They are not too catchy, and do not sound too interesting. Imagine GM named their car models as Car a, Car b, and Car c. But now that these names have been decided upon, it would be good to stick to them for a while and invest in them (strong marketing and advertising to bring visibility and awareness). Although a name may not be inherently interesting and catchy, strong marketing and advertising can rectify the situation or at least enhance their “coolness�. Frequent changes in names cause confusion and affect loyalty of customers.

I have always been impressed with the names given to different models of cars. These car manufacturers have given those names much deserved attention and thoughts. They have done extensive market surveys and gathered feedback from customers before the names are chosen. This may not be a bad approach for IBM to adopt. The naming of the new Microsoft OS, Window Vista, seems to be following the naming approach in the car industry. Microsoft has been using the brand names, Window and Office, and appending another word or year to them to identify different versions of Windows and Office (e.g., Windows XP, Windows Vista, Office 2007, etc.). This approach serves to promote the brand names, Windows and Office, and to signify to the customers that they are constantly and continuously making improvement and enhancement to the products (from Windows XP to Windows Vista, Office 2003 to Office 2007). iPhone and iPod sound good, too. It is also not a bad marketing move to promote each major release or version with some big events (e.g., at major conferences) with lots of press and publicity. Business executives do not have time to read Computer and IT magazines but they will watch CNN and read newspapers.

Given that IBM no longer has a PC division (it is Lenovo now), it needs to invest more in Academic Initiative to bring awareness and visibility to the IBM name to the students. Students will be exposed to Windows OS and Office suite at a young age, and will they use iPhone and iPod. Unless IBM invests heavily in Academic Initiative, the next generation of business students may not be aware of the existence of IBM at graduation. And that will be a very sad day given the contribution of IBM to the IT field.

Posted by: Keng Siau at September 29, 2007 1:02 PM

I'm afraid the name change is not the main reason for the decline of iSeries, but as you say, it doesn't help strong branding. The main reason imho is the lack of credible, native graphical user interface. By native I mean the transformation of the system's natural language (rpg or cobol) to a language with Visual and OO extensions. Most languages underwent this transformation in the nineties, RPG did not. As a shining example, I keep on referring to SAP, who transformed mainframe Cobol to Abap. Now SAP is a class of its own in the IT world. Any business manager won't hesitate to switch thousands of users to SAP, something most would (rightfully) hesitate to do with a VB.Net Erp solution.

So my statement: the main reason for the failure of iSeries is that "the RPG language has not succeeded in transforming into a Visual and OO extended language" is probably up for debate.

So feel free to post your opinion on what is for you the main reason for the decline of iSeries.

Posted by: ugeerts at October 1, 2007 4:49 AM

"...As a shining example, I keep on referring to SAP, who transformed mainframe Cobol to Abap. Now SAP is a class of its own in the IT world. ..."



I will take your word for it that a server language like RPG or Cobol can be transformed into something that renders GUI displays. I dont see how it can be superior to desktop or browser client programming languages.



RPG is done. It is legacy. I have been coding as400 applications the last 2 yrs at various locations and have hardly touched RPG. I get the bulk of my AS400 work done with SQL procedures.


To write interactive, GUI applications on the as400, use C# or VB, the .NET framework and an ODBC link to the 400. The .NET SDK, which includes the C# and VB compilers, is a no charge download. The only thing stopping i5 shops from writing great GUI apps is their inexperience at coding to the .NET framework.



-Steve

Posted by: Steve Richter at October 1, 2007 8:50 PM

Extension to ugeerts' opinion... Native graphical would be the best, though it would take years to transfer legacy software into that even if we would had that 'native graphical' tomorrow.

Because of that, in the mean time we would need products like WebFacing, which is buggy, but capable tool when you have a html/JavaScript resource who also understands dds/rpg(le).

But what did IBM? After many years of 'free' WebFacing it decides that let's put it together with HATS via mandatory WDHT runtime with incredible license price (26K€ in Europe for Windows and 13K€ for p10 i5!). It's like hitting with a hammer. And many use(d) that tool to extend the use of rpg applications and System i.
And when asking about this, STG says it's SWG's business. And SWG says it's STG's business. And soon because no one will buy it (26K€...think!), IBM will stop support from WF, HATS and WDHT.
IBM with it's reorganizations is the one who's killing System i. And meanwhile doing it, it's losing the trust from customers and partners with these kinds of actions and pushing them/us towards SAP, Oracle and Microsoft.

Posted by: Chimera at October 2, 2007 7:18 AM

Getting By

IBM does what it thinks it needs to do to survive. "Getting by" is the new IBM mantra and System i is its poster system for "getting by". The Rochester revolution ended in the 1980's. No marketing and no major computer science breakthroughs for twenty-years and you become like everybody else. But, if I am not mistaken, that was the objective -- to make all servers alike . . . and therefore able to run all IBM software. . . .

In IBM's case, of course, its decisions make the demise of its SMB market share seem more like it was by design, not by happenchance. "Getting By" will do that to you.

Microsoft is still entrepreneurial and does things to capture what ever market it positions itself to take. Ya gotta hand it to them. They take nothing lying down. Considering that Windows V1.0 was announced two years before it squirted out of the labs as a big flop in the mid 1980's, it is clearly a legacy operating system today -- but it still looks new and it is sold as new . . . and after twenty years of promises, it actually works -- well, sometimes. . . .

Microsoft announced vapor so that Visi-On, which had a real Windows product about 1984, would have nobody to sell to: "If MSFT was coing out with it, let's not invest in Visi-On."

Was MSFT embarrassed that Windows 1 did not really work? Nope. It was the marketing plan. It gave them the marketing time to beat Visi-On's GUI. Visi-On was beaten by MSFT Windows vapor, a.k.a marketing.

So Windows is legacy eh -- 20+ years but try to get away with telling Bill Gates that! IBM not only takes the legacy moniker on the chin, it actually uses it to describe its own products. Back in the mid 1980's Bill Gates was still having fun counting his money and projecting what he could eventually earn if only if . . . IBM's big systems were not even a Gates target then but the guy certainly has vision.

IBM must see the reaction of its customers to what it is not doing -- such as no natural Web GUI for the OS or for RPG. Microsoft tried three times to beat Novell with various LAN Server products. The first two were with black screen approaches like Novell but it finally did it with NT and a natural LAN server / management GUI. Is there a lesson here? Bill Gates is no longer impatient. Is Windows our destiny?

IBM wants to "get by" for sure. It doesn't want any marketing challenges that place entrepreneurial executives at risk.

The IBM Company is the inventor of the Intel-based Windows-driven PC, the Disk drive, and the System/38 - System i. If success were measured by great technology (disks and System/38) and very popular products (PC), IBM would be a $200 - $300 billion dollar company. The stockholders should be upset at how all three of these technologies / products were / are managed, not just the System i community.

Success unfortunately for IBM's System i users is achieved by how much one wants to win. When you want to win, eventually you win -- especially when your competitor just wants to "get by." For Microsoft, "getting by" is not an option. MSFT would not let Novell survive and it finally destroyed them with GUI.

Novell like IBM firmly believed that the server did not have to have GUI. What is Novell doing today? IBM certainly seems to believe that GUI is not needed on System i for users or developers, or as sane people do, they would solve the problem. How well is System i doing today? Of course it may be that IBM would have to invest in the product and who knows, with little to no marketing, the investment might not pay off. Are you thinking -- what's wrong with doing some marketing????

IBM would never consider engaging Microsoft in a marketing skirmish. The marketing department seems to be empty. It seems to still be thinking about how it can help Lenovo. Who is there that might engage the competition? Who is left to fight?

MSFT always wins its IBM battles with no bloodshed. Ya gotta hand it to them. They owe their success to a product that IBM invented and no longer sells. They're at least fun to watch and their machines don't freeze all the time any more. It sure beats "getting by."

Wouldn't it be nice if IBM chose to listen to its customers? When the biggest System i news is that IBM reorganized internally, you know that customer needs are not close to the top of the list.

How about announcing a plan that has some real objectives such as gaining 10% of the Microsoft SMB market share and taking them on big-time and beefing up the System i armaments to put on the big fight. How about starting by giving existing customers what they want and telling suspect and prospect customers that the System i exists and that IBM wants their business... etc. etc.

Doesn't that sound a lot better than "getting by"?

Posted by: Brian at October 3, 2007 10:58 AM

"...IBM would never consider engaging Microsoft in a marketing skirmish. ..."

More of a product skirmish or battle, no? Should IBM compete in all facets of the IT business? My guess is IBM mgmt sees that it would cost $billions per year to compete in the OS space against Linux and Windows and calculates there is no profit to be made. Same with languages and run time frameworks. Soon it will get out of the CPU business.

You might ask what is left. Plenty. Global services, DB2, Lotus Notes. Web query at $400 per user. The packaged software that businesses run on is a huge market space with no dominant player.

My only complaint with IBM on this is that they will not allow i5/OS to be free. Sell it or open source it. Let those who believe in i5/OS have a chance to improve and make it a viable long term option for its users.

-Steve

Posted by: steve richter at October 3, 2007 3:48 PM

Hi guys,

I see this thread suddenly popped up again.

In response to Trevor:

The failure to move the RPG language to the Visual and OO world is probably the major reason for the decline of iSeries. The extensions IBM gave to RPG (ILE) weren't in many cases enough to motivate shops to move to RPG ILE. I would suspect more than one third of them still write and maintain rpg400 code. Visual doesn't mean RPG should run GUI code (nor does ABAP for that matter), it means the language is for example able to control window sizes and visual components on the GUI and intercept GUI events. The actual GUI programming of low level visual components is done either in C or assembler and in 99% of cases on Windows O/S.
But alas, the time to transform RPG has long time passed by, IBM should have done that ideally around 1995-2000.

Therefore, as you say, I agree the RPG language is on its way to extinction.

In response to Chimera: right on the mark.

In response to Brian.

IBM tries from time to time to put up a fight, for example, think of the latest offering of cheap(?) 515 systems to recapture the SMB market. Was that initiative a flop yes or no? Sure the answer will be a well kept secret. BTW, Microsoft's oven is cooking more than ever. Anyone tried the free downloadable Virtual PC 2007 tool? Great stuff, let's you even run OS/2 or Linux under windows XP or 2003 - and it's totally free (hint for Rochester)

Posted by: ugeerts at October 4, 2007 10:13 AM

One final idea for a once and forever rename of the i think I remember what IBM calls it series:


'The Processor, formerly known as the AS/400'

and then, like Prince, when the current marketing geniuses move on to their successful futures in real estate and insurance sales, we can name it back to the AS/400.

Posted by: Brad Jensen at October 5, 2007 4:39 PM

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