Enabling Flexibility

Cloud provides new opportunities for organizations: It has changed business models for companies, including how software and hardware purchases are made. In response to these changes as well as client requests, IBM announced a consumption model for AIX* software purchases.

AIX Monthly Pricing, which was launched in March, is being well received by clients, says Jennifer Monk Lin, senior offering manager, AIX. The monthly pricing offering helps clients optimize their purchasing models.

The monthly pricing offering reflects how organizations have changed their accounting methods for software.

“It’s an important move for IBM because we want to make sure that our clients can shift some of their software spend to operational expense, rather than capital expense. We want to make sure that IBM has price models that align with that,” Lin says.

How It Works

AIX Monthly Pricing offers clients the ability to purchase AIX Standard Edition software licenses for each virtual processor core on a monthly basis. Previously, clients could only purchase the software for each processor core as a perpetual license. While perpetual licenses still exist, clients now can choose the best option for their organizations.

The monthly license entitles a client to run the AIX software for the month purchased. The monthly price includes software maintenance and support. It’s important to note the AIX software clients purchase under the monthly option isn’t a reduced version. “It’s the full AIX that you are used to. It has the same amazing performance, minimal downtime and robust security,” Lin adds.

The monthly pricing option is only available on the Small Tier classified servers (E850C and smaller), but isn’t tied to any specific hardware. Clients can purchase hardware separately and however they choose. “Instead of being tied to a prescribed machine, you have the ability to select hardware based on your business model and the needs of your client base. You also have choice in acquisition whether that’s via a partner or utilizing tools like IBM Global Financing,” she says.

Client Benefits

The AIX monthly option offers many benefits for end clients as well as managed service providers (MSPs).

Clients that have seasonal workloads, such as retailers, can ramp up capabilities as the market or season demands. DevOps is another use case that is well suited to the consumption model. “Clients who need to test a change to their database may need a couple of additional LPARs for just a few months. This option gives them the freedom to get the extra resources they need and only pay for what they will use,” Lin explains.

This pricing model adds flexibility to any organization operating hybrid cloud environments or utilizing cloud services. Clients and partners who are starting an IBM Power Systems* hosting practice of their own will be interested in the monthly model as they will incur lower operational risk to enter the cloud market.

The monthly pricing option also provides an alternative to IBM’s EasyScale offering. New MSPs could be concerned by the large investment needed to get their business off the ground. Besides purchasing hardware and software, MSPs must configure and test their cloud before they can accept clients. Licensing AIX on a monthly basis provides more control over their starting expenses and risk in order to better align with initial demand.

“IBM is doing everything it can to enable cloud providers to offer AIX,” Lin says. “Allowing new MSPs to pay for what they need, when they need it will enable MSPs to enter the business more easily. It’s a very attractive option,” she notes. The monthly pricing option also means that an MSP isn’t holding onto a perpetual AIX license when its client load changes.

Many multiplatform service providers are recognizing the opportunity that this monthly model provides. “Multiplatform service providers are used to optimizing upfront expenses, choosing what servers to acquire and how to optimize them within their data center. The monthly model helps them have an easier transition to the AIX and Power Systems platform,” Lin says. “Enabling MSPs to shift their expenses away from a large upfront cost allows them to focus more of their time and expense on creating a quality experience for their clients.”

The EasyScale Option

AIX Monthly Pricing is available to any AIX client who wants to use it for software purchases. But IBM also has a MSP-specific offering called EasyScale that has been on the market for several years.

With EasyScale, MSPs lease hardware under a three-year agreement and purchase software, processor core and memory activations as needed. The offering applies to AIX as well as IBM i and Linux* OS.

EasyScale’s leased machine—the S822—is the most popular hardware model for hosting. With this offering, MSPs can turn on one or two cores as demand requires. “When you need more cores and licensing as your business expands, you can purchase additional capacity on a daily basis. That gives MSPs granularity within their business model,” Lin notes.

Comparing EasyScale With Monthly Pricing

Recognizing that many clients are interested in moving to cloud providers or enabling a private cloud on premises, IBM performed user research on the pain points for both providers and end users in this space. The AIX monthly option aims to address those specific areas.

Here’s a look at the differences between EasyScale and AIX monthly pricing:

1. Hardware: EasyScale provides a good baseline of a best practice hardware and software combination for hosting, but some clients prefer to optimize their business around different hardware acquisition models.
Solution: The AIX monthly offering separates hardware from software.
2. Purchasing and Billing: EasyScale is only available via special bid, with manual reporting back to IBM.
Solution: The AIX monthly pricing offering is available through the IBM Passport Advantage ordering system. Clients can manage their entitlement and billing themselves as well as determine whether the billing cycle will be monthly, quarterly or annually. Reporting back to IBM isn’t required.
3. Serial number entitlement: Licensing tied to hardware serial numbers are difficult to manage, especially in a cloud-like environment where LPARs are being moved around and multiple tenants reside on different pieces of hardware.
Solution: Hardware support entitlement is done by IBM Customer Number, which does away with cumbersome bookkeeping and entitlement transfers based on serial numbers.
4. Multiple OS capability: The EasyScale offerings are built around scaling a single OS on the box, and clients wanted the option to have multitenant environments with AIX, IBM i and Linux potentially all co-existing on the same frame.
Solution: The AIX monthly price offering places no restrictions on usage of other OSs on the server, increasing flexibility.

Seizing Opportunities

Clients can expect to see additional positive developments for AIX and Power Systems. IBM plans to provide automation around a fully operationalized Power Systems software stack, and the focus remains on enabling clients to seize the opportunities that cloud offers.