system z market view and new customers

2011 IBM System zSummit System z Market View and New Customers

Tom RosamiliaGeneral Manager, IBM Power and z Systems

2© 2011 International Business Machines Corporation2

Smarter Computing: System z Analyst Summit

Agenda

2010 Review

Client Success and New Accounts

Payment Solution Providers

2011 Imperatives



We are entering the next era of computing

… to deliver twice the capacity on a flat budget

… applied to deliver new insights and drive innovation

… created by the integration of Big data in Optimized systems, managed as a Cloud

Smarter Computing The era of insight and discovery



IBM System z delivers capabilities for Smarter Computing

Automate Integrate SecureCentrally manage and automate operations to lower cost

Integrate multiple platforms to optimize workload deployment

Secure data for accelerated insight

Automated provisioning lowers cost of new and existing workloads

Integrate operations to free up resources for innovation

Advanced security to manage risk and reduce cost

Automated development tools for re-use of existing assets

Integrated private cloud for flexible service delivery

Governance to protect existing investments



System z improves IT efficiency across industries*

44%lower cost per

credit card transaction

31% lower IT spend per

consumer loan

25% lower cost per

mega watt hour produced

24% lower cost per hospital bed

20% lower cost per

airline passenger

26% lower cost per

new vehicle

25% lower cost per

retail store

23% lower cost per

barrel of oil

*Based on Dr. Howard Rubin Study



Centralized management of heterogeneous resources for simplification and resiliency

The next generation of mainframe technology, more performance, more scale, more efficient

IBM zEnterprise 196 (z196)

Integrated IBM POWER7 blades, IBM System x and DataPower and Smart Analytics Optimizer

zEnterprise Unified Resource Manager

IBM zEnterprise System A System of Systems that unifies IT for predictable service delivery

zEnterprise BladeCenter Extension (zBX)



Marketplace momentum

”

percent MIPS growth in 4Q10 – the highest growth in a decade58

“

percent year to year revenue growth in 4Q10 – the best growth in the last decade 69

YE03-YE10

Total InstalledCapacity

System z Install Base

IBM has once again made a hit with the mainframe, as Big Blue's Systems and Technology Group saw revenues increase 21 percent overall and mainframe sales rise nearly 70 percent in Q4 of 2010.

– eWeek, 25 Jan. 2011”“

IBM handily claimed the server market share lead in the fourth quarter as the company rode its new mainframe and Power7 systems, according to Gartner.

– ZDNet, 25 Feb. 2011



2H 2010 activity

Nearly 500 zEnterprise Systems shipped all over the world

Represents nearly 1.5M MIPS delivered to our customers

Delivered zBX to clients in 4Q

300+ clients conducted Fit for Purpose workshops (free service from IBM)

http://www.telcel.com.mx/



System z Linux: Fastest growing server platform

Thousands of ISVs investing in System z platform

Worldwide adoption of mainframe curriculum

Installed Linux MIPS growth of 42% CAGR (2004-2010)

Shipped IFL engine volumes increased 34% (4Q09 to 4Q10)

64 of the top 100 System z clients are running Linux on System z

32% of System z clients have IFLs installed

Linux represents 19% of the System z install base capacity

As of 2010:

More than 7,000 applications are supported on z/OS and Linux on System z

3,250+ Linux applications are supported on System z:

4,000+ applications are enabled on z/OS

There were 1,200 new and upgraded applications on System z in 2010, with 120+ new ISV partners added to the platform.

Thriving System z ecosystem

Based on IBM market analysis

University adoption:

814 schools enrolled globally, 50%+ outside of US

Continued flow of schools adding curricula

32,941 students from 17 countries have participated in Master the Mainframe contests since 2005

SystemzJobs.com: a new resource to connect System z clients, partners and businesses with students and professionals seeking System z job opportunities



System z future direction

IBMSystem z

and beyond …2011

DataPower XI50z

New zEnterprise Statement of Direction for Windows and Linux support in zBX

zEnterprise midrange follow-on

zEnterprise 196 GA2 for new and extended hybrid capabilities

z/OS V13

Increased performance/scale

Leadership technologiesImprove performance and system capacityContinue leadership on single thread performanceImprove OS / app availability via real-time monitoring and diagnosisSimplify management of zEnterprise workloads

Transformational technologiesEnable new capabilities with flash memoryTake advantage of connectivity tools and other industry trends



40% growth markets

60% major markets

50% running Linux

Majority installed Business Class technology

Across all industries

New client success in 2010, growth in 2011

61 New Accounts in 2010

Significant focus area

Increase in resources

Dedicated sales teams worldwide

Dedicated marketing team

First in Enterprise in 2011

© 2011 International Business Machines Corporation11




$11B+ Total Market Opportunity

More than 6,300 companies worldwide are a strong fit for new adoption of System z with sufficient IT spend to invest in $250K+ server market

System z new customer opportunities

Target Segment Profiles

Competitive environments that face complexity in managing their distributed Oracle environment.

Regional banks that need to support rapid growth, while lowering risk and meeting changing regulatory requirements.

Enterprise clients that use SAP for core business processes that face issues around rapid workload growth, availability and application infrastructure complexity.

Organizations that need to rapidly deploy Linux-based solutions and offer pay-as- you-go IT services for their users with capability for a large-scale dev/test environment.

Solution Offerings

Enterprise Linux Server System z Solution Edition for ACI, SAP, ChordiantEnterprise Linux Server

Solution edition for SAPFixed Price Migration offer

Solution Edition for Cloud Computing Smart Analytics Cloud for System z

OracleConsolidation

SAP Infrastructure Optimization

Tier 2 Core Banking Cloud

http://w3.ibm.com/software/xl/portal/content?synKey=T138834X71042V10






Tier 2 Core Banking

Why clients are moving to System z

Up to 80% reduction in TCO for Linux environments compared to a traditional distributed x86 server environment

Flexibility in the overall environment to meet changing business requirements and peak demand

Fully integrated solution across hardware, firmware, OS and applications

Predictable monthly expense via pay as you go model

Reduce server footprints, reduce costs, simplify infrastructure

Integrated system-wide security to protect customer data and lower the cost of compliance

Delivers continuous availability and best in class disaster recovery

Dynamic resources expansion to handle demand

Delivers continuous availability and best in class disaster recovery

Comprehensive system monitoring and workload management for services management and billing

OracleConsolidation

SAP Infrastructure Optimization

Cloud







Vietin Bank: Sun consolidation to Linux on System z

One of the largest banking institutions in Vietnam with 800 offices and 1,200 ATMs

Transaction banking workloads increasing with business growth

Consolidating Sun servers to the Enterprise Linux Server to run a new operational risk management solution

Needs business innovation to remain competitive

Expansion of banking businesses

Deliver premium services to customers



Asian airline: Automating services with SAP on System z

Large regional airline that wanted to upgrade its IT environment to achieve security and reliability as it revamps its operations

Automating various processes, including infrastructure and application support services

SAP deployed on System z with Power Systems as application servers, DB2 and Tivoli; IBM will test and implement the solution

Needs improved operating efficiency

Varied set of applications

Gain ability to deploy new applications on the same footprint, including data warehousing, business intelligence and e-mail



Università di Bari: Innovative cloud solutions for local businesses

University that built a system to sustain economic development in the southern Italian region of Puglia

Strategy provides computing services to local community, enabling fishermen, wine growers and others to contract for services through a portal

Cloud-based solution that leverages Linux on System z, IBM WebSphere and DB2, storage and Global Technology Services.

Needs heavy-duty computing power at minimal cost

Multiple entities tapping into the system

Decrease time-to-market, reduce transportation costs, reduce the amount of wasted products and improve overall product quality

http://www.uniba.it/

PSP: The New Generation of Processing on IBM System z

Danny GurizzanExecutive Vice PresidentPayment Solution Providers Inc.

Payment Solution Providers, Inc.Beyond your expectations

PSP corporate overview• Founded in 2000• Based in Toronto, Canada• Divisions:

•Terminal Division •POS application

•Switch Technology Division•Core Switch for processing•Gift Loyalty Solution•Health/Payment Card Solution

•Networking Division•Processing Division

Payment Solution Providers, Inc.Beyond your expectations

• Key competitors:• Moneris• Chase Paymentec• Global Payment• Ingenico

• Marketplace dynamics:• Reliability• Security• Time to market• Price

18

Business and IT challenges• Where we came from:

•HP (Blade Servers with Virtual Host Server Partitions) / Oracle on Intel solution

• Where we are today:•Completing the conversion to z/OS, WebSphere

and DB2

•Payment Switch Technology running on System z for our PSP Card Services Payment Processing Division

•Single point of contact for VISA, MasterCard, American Express, INTERAC Direct Payment, and numerous Point of

Sale Terminals and Sales Solutions

Payment Solution Providers, Inc.Beyond your expectations19

Why System z• Decision process:

• With thousands of POS devices running off our switch

representing millions of transactions per month and countless

servers growing on a daily basis, what is the future of PSP?

• Cost of ownership• Scalability• Reliability• Secure PCI environment• Reputation / marketplace penetration• IBM expertise and assistance to reach our corporate goals


How we are using System z Technology• As a processor, we require:

•Highly reliable processing of thousands transactions per second from hundreds of thousands of concurrent end‐

users

with sub‐second response, which allows for the ability to accept millions of transactions per day

•Maintains the integrity of the transaction against all types of failures

•Intelligent, automated error processing•Industrial‐strength, high‐transaction capabilities•Scalability


How we are using System z technology• Platform:

Pre‐Mainframe Mainframe


Benefits of System z to PSP• Reliability – 24 x 7 x 365 up‐time, extremely important in

the processor arena:–Reputation as a processor demonstrating the stability of its

environment is one of the most important values.

• By establishing a virtualized environment, we are achieving cost‐reduction goals through increased utilization, while

providing high availability for business‐

critical applications• Unmatched scalability – transaction power as the

processing business is cyclical, e.g., Christmas, Thanksgiving, Valentine’s Day


Benefits of System z to PSP (continued)• With the System z technology, we are able to accept

thousands of transactions per second, which exceeds many current technologies

• Faster time to application development completion• PCI compliance is extremely important to us• Reduced power, operating and cooling costs


Next steps• IBM Smart Analytics Optimizer• Integrated Cryptographic Service Facility• Representation and PSP corporate exposure

•IBM representation of the PSP Switch Technology on z

technology for worldwide banks• License Offering or Hosting • EMV Chip technology (Europay

MasterCard Visa)


Thank you• PSP is its own reference site for its switch

technology, which will process millions of transactions on a daily basis




2011 imperatives

Continue momentum of zEnterprise sales

Upgrade of existing base

Growth through new workloads

Continue our investment in the platform

Deliver product enhancements

Increase our visibility in the market by:

Driving adoption of hybrid workloads

Extending First in Enterprise program



Thank you! ibm.com/smartercomputing



Trademarks and disclaimersIntel, Intel logo, Intel Inside, Intel Inside logo, Intel Centrino, Intel Centrino logo, Celeron, Intel Xeon, Intel SpeedStep, Itanium, and Pentium are trademarks or registered trademarks of Intel Corporation or its subsidiaries in the United States and other countries./ Linux is a registered trademark of Linus Torvalds in the United States, other countries, or both. Microsoft, Windows, Windows NT, and the Windows logo are trademarks of Microsoft Corporation in the United States, other countries, or both. IT Infrastructure Library is a registered trademark of the Central Computer and Telecommunications Agency which is now part of the Office of Government Commerce. ITIL is a registered trademark, and a registered community trademark of the Office of Government Commerce, and is registered in the U.S. Patent and Trademark Office. UNIX is a registered trademark of The Open Group in the United States and other countries. Java and all Java-based trademarks and logos are trademarks or registered trademarks of Oracle and/or its affiliates. Other company, product, or service names may be trademarks or service marks of others. Information is provided "AS IS" without warranty of any kind.

The customer examples described are presented as illustrations of how those customers have used IBM products and the results they may have achieved. Actual environmental costs and performance characteristics may vary by customer.

Information concerning non-IBM products was obtained from a supplier of these products, published announcement material, or other publicly available sources and does not constitute an endorsement of such products by IBM. Sources for non-IBM list prices and performance numbers are taken from publicly available information, including vendor announcements and vendor worldwide homepages. IBM has not tested these products and cannot confirm the accuracy of performance, capability, or any other claims related to non-IBM products. Questions on the capability of non-IBM products should be addressed to the supplier of those products.

All statements regarding IBM future direction and intent are subject to change or withdrawal without notice, and represent goals and objectives only.

Some information addresses anticipated future capabilities. Such information is not intended as a definitive statement of a commitment to specific levels of performance, function or delivery schedules with respect to any future products. Such commitments are only made in IBM product announcements. The information is presented here to communicate IBM's current investment and development activities as a good faith effort to help with our customers' future planning.

Performance is based on measurements and projections using standard IBM benchmarks in a controlled environment. The actual throughput or performance that any user will experience will vary depending upon considerations such as the amount of multiprogramming in the user's job stream, the I/O configuration, the storage configuration, and the workload processed. Therefore, no assurance can be given that an individual user will achieve throughput or performance improvements equivalent to the ratios stated here.

Prices are suggested U.S. list prices and are subject to change without notice. Starting price may not include a hard drive, operating system or other features. Contact your IBM representative or Business Partner for the most current pricing in your geography.

Photographs shown may be engineering prototypes. Changes may be incorporated in production models.

© IBM Corporation 2011. All rights reserved.References in this document to IBM products or services do not imply that IBM intends to make them available in every country.

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