Analysis: IBM (NYSE: IBM) created international media attention and industry buzz with the unveiling of new mainframes targeting Linux. Mainframes are a rare bright spot for Big Blue in hardware, and the new LinuxONE program has a big upside, believes analyst Stephen Belanger of Technology Business Research.

HAMPTON, N.H. – IBM launched its LinuxONE portfolio and the Open Mainframe Project to better address enterprise Linux demand.

IBM is narrowing its focus on the Linux market with the launch of its LinuxONE portfolio and its participation as a Platinum member in the Open Mainframe Project, which was launched by The Linux Foundation on Aug. 17. IBM has over 15 years of experience deploying Linux on its mainframes through its zOS platform, with approximately half of its mainframe customers running at least one instance of Linux. Following IBM’s January launch of z13, z Systems revenue increased 40.8% year-to-year in 1H15. TBR notes this is a significant improvement over z Systems’ full-year revenue decline of 23.3% in 2014, and the LinuxONE launch will help IBM drive continued z Systems revenue growth into 2016.


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IBM will leverage the LinuxONE portfolio launch to meet rising enterprise demand in areas such as analytics, mobile processing and cloud computing, as Linux is commonly used by customers for these workloads.

IBM can approach customers with a cohesive portfolio of Linux hardware, software and services, which TBR believes will help the company adapt to the ongoing market shift from data center components to higher-value, end-to-end solutions.

IBM has an opportunity to leverage the performance and security advantages of its z Systems portfolio compared to competitors’ server offerings to target customers in verticals such as healthcare, financial services and public sector that are seeking Linux solutions. Linux has been a key factor that has enabled IBM to keep its mainframe portfolio relevant amid continued hardware commoditization and growing competition from the x86 server market. As customer demand in the global server market continues to shift to more open and flexible systems, Linux portfolio improvements will help IBM better accommodate changes in customer demand.

Last Monday IBM launched two LinuxONE systems, Emperor and Rockhopper. Emperor is capable of analyzing transactions in real time and scalable up to 8,000 virtual machines or hundreds of thousands of containers. Rockhopper will target entry-level mainframe demand from customers seeking the advantages of the mainframe, including performance, security and availability, but in a smaller and more affordable package compared to Emperor.

IBM is approaching the market with a message of “Linux your way,” providing customers several choices for distribution, runtime, hypervisor, database, analytics and cloud management tools. This is the first time customers will be able to purchase Linux mainframes with multiple options for each aspect of the software stack. IBM is working with a number of partners to allow software such as Red Hat, SUSE, KVM, Python, Node.js, Docker, Chef, Puppet and Oracle database to run on its Linux mainframes.

IBM is also offering multiple pricing models to support its “Linux your way” approach. The vendor will offer a pay-for-use model for its hardware and software solutions, a per-core pricing model for its software stack for Linux and a rental model with a low-lease commitment. TBR believes multiple pricing models will enable the company to better serve customers’ unique needs.

At the same time as announcing its new LinuxONE offerings, IBM announced it joined the Open Mainframe Project (OMP) as a founding Platinum member. The foundation was established by The Linux Foundation, a nonprofit organization dedicated to driving Linux adoption. Other founding Platinum members of OMP include ADP, CA Technologies and SUSE, which plan to collaborate to create new Linux solutions.

Specifically, OMP members will focus on creating new Linux technologies that can take advantage of the security, performance and availability advantages of IBM’s mainframes. Founding Silver members of OMP include BMC, Compuware, LC3, RSM Partners and Vicom Infinity. Additionally, OMP partners plan to collaborate with academic institutions such as Marist College, University of Bedfordshire and the Center for Information Assurance and Cybersecurity at University of Washington to ensure there are future employees who are capable of managing mainframes.

(C) TBR