System z Market View and New Customers

2011 IBM System zSummit
System z Market View and New Customers
Tom Rosamilia
General Manager, IBM Power and z Systems

Smarter Computing: System z Analyst Summit

Agenda
 2010 Review

 Client Success and New Accounts

 Payment Solution Providers

 2011 Imperatives

2 © 2011 International Business Machines Corporation
2


We are entering the next era of computing

Smarter Computing
The era of insight and discovery

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

… applied to deliver
new insights and drive
innovation

… to deliver twice
the capacity on a
flat budget

3


IBM System z delivers capabilities for Smarter
Computing

Automate Integrate Secure
Centrally manage and Integrate multiple platforms Secure data for accelerated
automate operations to lower to optimize workload insight
cost deployment

Automated provisioning Integrate operations to free Advanced security to
lowers cost of new and up resources for innovation manage risk and reduce cost
existing workloads

Automated development Integrated private cloud for Governance to protect
tools for re-use of existing flexible service delivery existing investments
assets

4


System z improves IT efficiency across industries*

44% 31% 25%
lower cost per lower IT spend per lower cost per
credit card transaction consumer loan mega watt hour produced

24% 20%
lower cost per lower cost per
hospital bed airline passenger

26% 25% 23%
lower cost per lower cost per lower cost per
new vehicle retail store barrel of oil

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*Based on Dr. Howard Rubin Study


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

IBM zEnterprise 196 (z196) zEnterprise Unified zEnterprise BladeCenter
Resource Manager Extension (zBX)
 The next generation of  Centralized management  Integrated IBM POWER7
mainframe technology, of heterogeneous blades, IBM System x and
more performance, more resources for simplification DataPower and Smart
scale, more efficient and resiliency Analytics Optimizer
6


Marketplace momentum

System z Install Base “ IBM handily claimed the server
market share lead in the fourth
quarter as the company rode its
new mainframe and Power7

Total
Installed
Capacity
systems, according to Gartner.
– ZDNet, 25 Feb. 2011
”
“ 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

YE03-YE10
nearly 70 percent in Q4 of 2010.
– eWeek, 25 Jan. 2011
”
percent MIPS growth percent year to year revenue
58 in 4Q10 – the highest
growth in a decade
growth in 4Q10 – the best
growth in the last decade 69
7


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)

8


Thriving System z ecosystem
System z Linux: Thousands of ISVs Worldwide adoption of
Fastest growing investing in mainframe curriculum
server platform System z platform

 Installed Linux MIPS growth As of 2010: University adoption:
of 42% CAGR (2004-2010)  814 schools enrolled globally,
 More than 7,000 applications
 Shipped IFL engine volumes are supported on z/OS and 50%+ outside of US
increased 34% Linux on System z  Continued flow of schools
(4Q09 to 4Q10) adding curricula
 3,250+ Linux applications are
 64 of the top 100 System z supported on System z:  32,941 students from 17
clients are running Linux on countries have participated in
 4,000+ applications are enabled Master the Mainframe contests
System z
on z/OS since 2005
 32% of System z clients have
 There were 1,200 new and  SystemzJobs.com: a new
IFLs installed resource to connect System z
upgraded applications on
 Linux represents 19% of the System z in 2010, with 120+ clients, partners and
System z install base capacity new ISV partners added to the businesses with students and
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platform. professionals seeking System z
© 2011 International Business Machines Corporation
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job opportunities
Based on IBM market analysis


System z future direction

IBM
System z

2011 and beyond …
 DataPower XI50z  Leadership technologies
Improve performance and system
 New zEnterprise Statement of Direction capacity
for Windows and Linux support in zBX Continue leadership on single
thread performance
 zEnterprise midrange follow-on Improve OS / app availability via
real-time monitoring and diagnosis
 zEnterprise 196 GA2 for new and Simplify management of
extended hybrid capabilities zEnterprise workloads

 z/OS V13  Transformational technologies
Enable new capabilities with flash
 Increased performance/scale memory
Take advantage of connectivity
tools and other industry trends

10


New client success in 2010, growth in 2011

61 New Accounts First in Enterprise
in 2010 in 2011

 40% growth markets  Significant focus area

 60% major markets  Increase in resources

 50% running Linux  Dedicated sales teams
worldwide
 Majority installed
Business Class
 Dedicated marketing
technology
team

 Across all industries

11


System z new customer opportunities
$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

SAP
Oracle Tier 2 Core
Infrastructure Cloud
Consolidation Banking
Optimization

Target
Competitive environments Regional banks that need to Enterprise clients that use Organizations that need to
Segment
that face complexity in support rapid growth, while SAP for core business rapidly deploy Linux-based
Profiles managing their distributed lowering risk and meeting processes that face issues solutions and offer pay-as-
Oracle environment. changing regulatory around rapid workload you-go IT services for their
requirements. growth, availability and users with capability for a
application infrastructure large-scale dev/test
complexity. environment.

Solution Enterprise Linux Server System z Solution Edition Solution edition for SAP Solution Edition for Cloud
for ACI, SAP, Chordiant Fixed Price Migration Computing
Offerings
Enterprise Linux Server offer Smart Analytics Cloud for
System z
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Why clients are moving to System z

SAP
Oracle Tier 2 Core
Infrastructure Cloud
Consolidation Banking
Optimization

Up to 80% reduction in Flexibility in the overall Fully integrated solution Predictable monthly
TCO for Linux environment to meet across hardware, firmware, expense via pay as you
environments compared to changing business OS and applications go model
a traditional distributed requirements and peak
x86 server environment demand

Reduce server footprints, Integrated system-wide Delivers continuous Dynamic resources
reduce costs, simplify security to protect availability and best in expansion to handle
infrastructure customer data and lower class disaster recovery demand
the cost of compliance

Delivers continuous Comprehensive system
availability and best in monitoring and workload
class disaster recovery management for services
management and billing

13


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

14


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

15


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
16

PSP: The New Generation of
Processing on IBM System z
Danny Gurizzan
Executive Vice President
Payment Solution Providers Inc.

Beyond your expectations Payment Solution Providers, Inc.

PSP corporate overview
• Founded in 2000 • Key competitors:
• Based in Toronto, Canada • Moneris
• Divisions: • Chase Paymentec
• Global Payment
•Terminal Division
• Ingenico
•POS application
•Switch Technology Division • Marketplace dynamics:
•Core Switch for processing • Reliability
•Gift Loyalty Solution • Security
•Health/Payment Card Solution • Time to market
• Price
•Networking Division
•Processing Division
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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
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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
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• 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
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How we are using System z technology
• Platform:
Pre‐Mainframe Mainframe

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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
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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

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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)

25


Thank you
• PSP is its own reference site for its switch
technology, which will process millions of
transactions on a daily basis

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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

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Thank you!
ibm.com/smartercomputing

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Trademarks and disclaimers
Intel, 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
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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
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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
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© IBM Corporation 2011. All rights reserved.
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Trademarks of International Business Machines Corporation in the United States, other countries, or both can be found on the World Wide Web at http://www.ibm.com/legal/copytrade.shtml.

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