IBM vs. Oracle HP Itanium

It was mind boggling enough when Oracle bought Sun Microsystems in April 2009, ostensibly to create “the only company that can engineer an integrated system – applications to disk – where all the pieces fit and work together..,” as Oracle CEO Larry Ellison declared at that time. Huh, had he ever heard of IBM?

Since then, Oracle has done nothing with Sun or SPARC while IBM has been converting Sun customers to System z and Power platforms by the hundreds. So, what possibly could Oracle been thinking when it recently declared Intel’s Itanium chip dead before Intel or HP did other than to hand IBM another banquet of system conversions to feast on? It’s not like Oracle can offer new Sun/SPARC servers as a viable replacement for Itanium. To the contrary, Oracle reported Q4 hardware sales down 6% year-over-year.

Let the IBM feasting begin. The company has identified several thousand potential HP Itanium prospects and started rolling out its strategy to bring them over to System z, Power, or System x.

In truth, Itanium already wasn’t doing well before Oracle stuck a knife in it. As IBM interprets the IDC market data it extended its lead in the UNIX servers in Q4 2010 by capturing 53.9% revenue share of that segment, gaining 5.9 points of share over competitors and leading the second-place vendor, HP, by more than 30%. If you then consider the huge gains made by the System z in the high end server market following the introduction of the zEnterprise, IBM clearly dominates the high end server market over both HP and Oracle/Sun. The latest IDC server market report, May 2011, can be found here.

For the high end server market, the choices are clear: after two years under Oracle Sun/SPARC is going nowhere and, despite what Intel may still say, Itanium isn’t going anywhere either, especially after what Oracle just did to it and HP. The only platforms capable of running enterprise-class UNIX or Linux applications are IBM System z (z10, z196, zEnterprise/zBX) and IBM Power Systems with Power7. At some point Intel may rev up Xeon but that would be well into the future.

Of course, IBM also provides high end x86 systems, the eX5 platform that uses the Xeon processor. And if you need a more enterprise-capable version of x86, the zEnterprise will be sporting x blades running Linux before the end of the year and ultimately run Windows.

Meanwhile, IBM is ramping up a worldwide full court press to win nervous or disgruntled or frustrated Itanium customers to one or another IBM platform. To date, it has had its biggest success in terms of conversions to the Power platforms. In 2009, it reports migrating over 600 customers to Power, 85% of which came from Sun or HP.  Over the past four years, IBM has migrated over 2000 companies to Power, again most coming from Sun or HP.  Earlier this year IBM reported that 61 companies adopted the System z platform either for the first time or returning after a long absence and some came from HP systems. You will find case studies on several of those HP refugees here and here.

To facilitate the exodus from Itanium to an IBM platform, IBM is offering help and incentives. The Stop & Think program brings a variety of technical and financial assessments to help reduce data and application management costs by up to 30%. If the organization wants to shift from the Oracle database to DB2 it will save one-third the cost and be able to cut the number of FTEs needed to administer the database by over half. Similarly, the Breakfree program offers a three-year 50% TCA savings. Along the way, IBM will discount or bundle in Migration Factory to actually get you there.

IBM recently compared an HP Itanian Superdome 12 with 32 cores and the Oracle database with an IBM Power 770 with 16 cores and migration to DB2 via IBM Migration Factory with the Breakfree discount applied. The 3-year HP cost, including the usual Oracle discounting end up 50% more than the 3-year IBM Power/DB2/Breakfree deal. Then IBM’s financing group will work the numbers to smooth the transition costs over the three years.

Most of IBM’s migration customers go with the Power platform. For those that want the advantages of the System z or zEnterprise there likely will be some very good deals cropping up this summer with the widely expected introduction of lower cost business class z196 machines and, probably, deeply discounted hardware/software/maintenance System z Solution Edition bundles. Since those are usually reserved for new workloads, a migration customer should automatically qualify.

If you were an HP Itanium customer or a Sun/SPARC customer pondering your organization’s IT roadmap, what would you do?

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One Response to “IBM vs. Oracle HP Itanium”

  1. bob Says:

    If you read HP’s literature, they will claim, somewhere, inevitably, that one of their machines beats IBM on price and performance. If you read Oracle’s literature, they will claim somewhere, inevitably, that that one of their machines beats IBM on price and performance. Neither will give any scientific basis to the claims. Yet, here we have in this article, exactly the same guff about IBM beating oracle and HP on price/performance, again with no scientific arguments to back it up. You marketeers really do live in a dreamworld!

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