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Technology Stocks : IBM -- Ignore unavailable to you. Want to Upgrade?

To: chunmun who wrote (5105)	5/2/1999 3:22:00 PM
From: VICTORIA GATE, MD	Read Replies (2) \| Respond to of 8218

Sunday May 2, 1:49 pm Eastern Time New IBM mainframes to ship in May, ahead of plan By Eric Auchard NEW YORK, May 2 (Reuters) - International Business Corp. (IBM - news) is set to unveil on Monday the company's new generation of mainframe computers, the world's highest-capacity business machines, and ship them at least a month ahead of schedule. The G6 mainframes -- IBM's sixth generation mainframe since 1994 -- once again smash industry performance records and give IBM a sales head-start on even more powerful machines due out in September from rival Hitachi Data Systems. The new IBM computers, officially called the S/390 Parallel Enterprise Server - Sixth Generation, can process 1,600 million instructions per second (MIPS), or 50 percent more data-handling capacity than IBM's record-setting G5 machines. G6 mainframes are set to begin shipping May 28, at least a month ahead of IBM's original schedule. ''The S/390 G6 Server provides the capacity, bandwidth and flexibility that customers need to run an integrated e-business,'' said David Carlucci, general manager of IBM's S/390 division, using IBM's term for Internet-based business. Mainframes, despite IBM's diversification into software and computer services, remain key to financial performance for IBM, the world's largest computer maker. Each mainframe sale tends to bring in additional software and services revenue. ''Obviously, the more successful we are shipping 390 (computer) capacity, the more it benefits our middleware (software) business, our financing business, and to some degree our services business,'' Carlucci said. IBM hopes the G6 machines will capitalize on the momentum of the G5 Server, which analysts say has captured as much as 95 percent of worldwide sales of mainframe computers over the last three quarters, leaving only crumbs for Hitachi Data and Fujitsu Ltd.'s Amdahl, IBM's two direct competitors. Hitachi Data, a joint venture between Japan's Hitachi Ltd. and U.S.-based Electronic Data Systems Corp. (EDS - news) , has said its Skyline Trinium, due in September, will be able to process up to 3.2 billion instructions per second. ''Every month that IBM can deliver the G6 before Hitachi can deliver their new Trinium just means more business for IBM,'' said Charlie Burns, an analyst with Giga Information Group. By arriving early, the G6 line-up gives IBM a head-start not only on rivals like Hitachi, but on a possible purchasing slowdown in the second half of 1999, as customers turn to focus on possible Year 2000 glitches in existing machines instead. ''We saw 1999 as a bit of a unique year as to how much disruption customers would implement, particularly as the year carried on,'' IBM's Carlucci said. The 50 percent increase in capacity of the G6 systems is partly a function of new microprocessors using high-speed copper-wiring -- a technology developed at IBM -- instead of conventional aluminum-wired chips, IBM said. Carlucci said IBM is marketing the G6 to handle not just traditional corporate database and transaction processing jobs but demanding new workloads like electronic commerce. The G6 handles business intelligence -- combing massive company databases for marketing data -- and electronic resource planning (ERP) -- stitching together key business operations like manufacturing, payroll and human resources. Toward that end, Germany's SAP AG (quote from Yahoo! UK & Ireland: SAPG.F), the world's No. 1 maker of ERP software, will announce at a conference in Nice, France, this week that by the fourth quarter G6 mainframes will be optimized to boost the performance of SAP software. In this, IBM is looking past traditional markets to compete in the biggest growth market -- handling Internet transactions -- against rivals like Hewlett-Packard Co. (HWP - news) and Sun Microsystems Inc. (SUNW - news). H-P and Sun make high-performance server computers running UNIX software. In recent years, they have won the lion's share of orders for computers used to run Internet-based businesses. But IBM mainframes -- once written-off as dying technology -- are once again in fashion due to their time-tested readiness in handling millions of simultaneous customer requests -- an increasing necessity on popular Web sites. This is because electronic commerce transactions over the Web are much the same thing as the ''online tele-processing'' IBM invented in the 1960s to allow corporate customers to shift mainframe data over dedicated phone lines. Instead of a central company computer serving only its own office workers, mainframes are now used to supply data to millions of customers -- creating unpredictable surges in usage -- but surges IBM has decades of experience in handling. The design of mainframes allows computer administrators to allocate up to 100 percent of capacity to respond to sudden spikes in customer usage, a sharp contrast to UNIX computers from Sun or H-P or ''server farms'' running Microsoft's Windows NT, which must rely on spare computers to handle such spikes. These new computer functions, which are becoming widespread among large corporate computer users, now comprise about 27 percent of the tasks handled by IBM mainframes, up from only 5 percent or so in 1997, Carlucci said. The figures are important as they suggest that mainframes -- which for decades have stored most of the world's corporate data but were seen as dinosaurs at the start of this decade -- are once again finding favor in the Internet era. ''We really put the competitive focus on Sun and H-P rather than looking strictly at our traditional competitors,''