IBM Financing and Storage News

IBM Corp. announced a range of new storage products while the IBM Global Financing (IGF) unit launched an Economic Stimulus Advantage Offering to lower the cost to U.S. customers leasing new equipment in 2008.

Focal Points:

• IBM unveiled new DR550, DS3000, N7000, N3000, SAN, and tape storage offerings last week. The DR550 v4.5 provides new packaging that simplifies acquisition, set up, support, and upgrading of the DR550s. There are two new models – DR1 and DR2. The DR1 is designed for the small and mid-sized businesses (SMBs) with a capacity ranging from 880 GBs to 37 TBs of raw disk storage. It has a 25U rack with lockable doors and is tape ready. The DR2 is targeted at large enterprises that have a storage capacity requirement in the 6 TB to 168 TB range. It has single or dual server options, 36U rack with lockable doors, and replication options, and is tape ready. The DS3000 is aimed at the small and medium-size business (SMB) market, has a scalable storage manager, SATA drives for tiered storage, and AIX support. It is accessible from IBM BladeCenters and System x servers as well as System p servers on the DS3400. Dell Inc. and Hewlett-Packard Co. servers are also supported. Prices start at $4,500.
• The second generation of the N7000 series was announced. It has faster onboard port speeds and is extremely scalable. It can handle up to 1,176 TBs of raw storage, 1,176 fibre channel or SATA disk drives, 56 fibre channel ports, and 52 GB Ethernet ports. The new N7900 has two times the processing cores of the N7800. The N3000 series comes with an easy start wizard for rapid installation, internal low-cost SATA drives, and more expansion slots. There is a new IBM System Storage SAN768B fabric backbone with 8 GB/s link speeds and more than four times the performance of previous b-type and m-type directors, according to IBM. It is also designed to support future 10 GB/s Fibre Channel over Ethernet (FCoE) standard and Brocade Communications Systems Inc.'s Data Center Fabric Architecture. IBM introduced the TS3100 and TS3200 tape libraries that use LTO-4 half-high SAS tape drives. The high capacity, high performance drives support data encryption and write-once, read-many (WORM) cartridges and are read/write compatible with LTO-3 cartridges.
• In response to the U.S. Economic Stimulus Package that President Bush signed into law last week, IGF created an Economic Stimulus Advantage Offering that will give customers a new low rate over the life of the lease or a free three month deferral on the acquisition and lease of new IT equipment installed in 2008. According to IGF, this offering applies to IBM or non-IBM equipment for customers in the U.S. that are eligible for the federal economic stimulus package. The bill also gives U.S. customers the opportunity to take advantage of IBM's Asset Recovery Solutions. Under this program, IBM can buyback and dispose of excess or existing technology, replacing it with new technology that may potentially benefit from the enhanced lease and financing terms in IGF's Economic Stimulus Advantage Offer.

Experton Group believes IBM is stepping up its campaign to redefine the IT financing and storage markets, demonstrate its thought leadership, and expand its market share. While the IBM announcements addressed all size customers, the storage announcements were primarily targeted at the SMB market, where IBM's penetration is quite low. IBM restructured its product division last month to allow for added focus on the SMB customers and to create more products specifically tailored to meet their requirements. These announcements are the first salvo of many, as IBM works to grow its business globally with customers that are mostly medium sized enterprises. IGF over the last few years has been developing new tools and methods to expand its presence in all aspects of the IT financing markets worldwide. The Economic Stimulus Advantage Offering is another example of the creative leadership that IBM brings to the market and expects others to follow IBM's lead. IT executives should develop a strategic approach to expansion and use of storage within the enterprise – creating a cohesive storage architecture for data centers, departmental and client systems while addressing consolidation, energy conservation, scalability, security, and virtualization requirements.

IT executives of companies that can take advantage of the U.S. Economic Stimulus Package should work with their finance staff to reevaluate their hardware and software acquisitions in light of the new regulatory incentives and the IBM leasing alternatives. IT executives should view this as an opportunity to align their acquisition actions with the 2008 strategies under development and/or review by the CFO and the finance organization.