IT KEE

Lloyds mulls offshoring deal with IBM
By John Oates
Published Tuesday 25th May 2004 10:08 GMT
High street bank Lloyds TSB is considering an offshoring agreement with IBM that could see as many as 10,000 UK jobs go overseas. The deal could be worth as much as £1bn over ten years.

Many of Lloyds' IT staff would move to IBM as part of the deal. IBM would run the bank's internal systems, websites and the network linking its branches, according to London local paper the Evening Standard. IBM is believed to be one of two companies bidding for the contract.

Lloyds TSB faced anger at its annual meeting last week where protesters objected to its plans to offshore 1,500 call centre jobs to India.

The bank refused to comment to the paper, saying if such a deal had gone ahead then staff and unions would have to be informed first. ®

What makes Linux standout when compared to z/OS or to rephrase, what are the additional features in Linux on the mainframe not available under MVS? z/OS and even OS/390 I believe already possess Unix like capabilities (providing TCP/IP applications, Web services, Web to CICS connectivity, etc.)?

In the future, in your opinion what business value will Linux provide running along with z/OS on the same machine?

This question posed on 06 January 2004

Primarily, the major advantages to having Linux on the mainframe is -- in combination -- with the traditional IBM operating systems, not by itself.

Linux is:

1. ASCII based, allowing easy portability of useful applications w/o the difficulties of porting to a non-ASCII environment.

2. Widely accepted outside the mainframe universe. This benefits both consumer and ISV in that code does not need to be dual-path for mainframe and non-mainframe environments. The same applications that run in traditional Unix environments are immediately available -- at the same level and level of function -- on the Linux platform as elsewhere. No waiting for USS ports or rewrites for z/OS.

3. Widely accepted tooling. The software development and deployment tools are the same ones used in every other Unix environment immediately making your programmers productive. These are also the tools that your new hires are likely to know without additional training.

4. ISVs are much more likely to port popular applications to Linux than z/OS or USS due to the larger potential market. If an ISV has an Intel Linux version of the application, providing a mainframe version is a matter of compiling the binaries on a 390 and testing. Producing a USS or z/OS port is much more difficult.

5. The combination of Linux on the mainframe and the traditional IBM operating systems allows Linux to quickly provide accepted industry standard access tools and methods but allow data to reside in an environment that is optimized for data management. z/OS is transaction-oriented, Linux is communications-oriented. Right tool, right job. Unix System Services (USS) is the z/OS component that provides a Unix 95 API to z/OS function.

It is:

1. EBCDIC, which requires significant coding in most applications to cope with a non-contiguous character set.

2. Unfamiliar to most developers (even IBM no longer recommends USS as the native platform for z/OS apps).

3. Missing access to many z/OS function (such as tape) except through assembler programming (a rare skill for Unix programmers).

4. Non-standard API. Unix 95 may be a "standard" but it lacks acceptance in the real world. The Linux and Solaris APIs are the de-facto "standards."

5. Non-portability of code. Unless you have very skilled or disciplined programmers, code written for USS is not reusable elsewhere.

In my opinion, Linux will take over a majority of the application logic and front-end access to mainframe applications due to its wide acceptance with tooling and interface toolkit vendors and z/OS will be tasked with providing a transaction and data storage/data management engine. z/VM will assume a majority of the function of LPARs (as it should have years ago!) and take over resource management and virtualization of server and network hardware.

IBM lands Qantas outsourcing deal

May 17, 2004, 9:53 AM PT

IBM Global Services on Monday announced a $450 million, 10-year contract from Australian airline Qantas Airways to manage its data center and other information technology needs.
The deal is effective May 31. IBM will shift all Qantas servers to IBM's Sydney data center and run machines and a range of managed services for Qantas at different locations.

The Australian airline will use the IBM servers on an on-demand basis with payment limited to usage time. IBM claims that the arrangement will help Qantas cut costs and increase flexibility and efficiency.

IBM has been pushing its on-demand services, saying the process will enable it to outsell its competitors. The company has been trying to convince customers that on-demand computing maximizes performance while cutting overhead.

This is the third major deal landed by IBM in less than a month. Earlier, global oil giant Shell and Morgan Stanley inked outsourcing contracts with IBM.

Grid fuels innovation at Johnson & Johnson

By Mark Brunelli, News Writer
27 May 2004 | Search390.com

PHILADELPHIA -- When most people think of Johnson & Johnson, Inc., images of baby powder and shampoo come to mind. But the company is also on the forefront of pharmaceutical research, and grid computing is becoming a major part of that effort.

Jeffrey C. Mathers, director of research innovation at Johnson & Johnson Pharmaceutical Research & Development LLC in San Francisco, Calif., told the audience at Gt'O4 that in the pharmaceutical industry, there is always a lot of pressure to cut costs and bring products to market faster. That is why his company has begun to employ grid technology.

He said that J&J PRD, an IBM customer, is using grid technology to run powerful applications which model clinical trials of pharmaceuticals, and ultimately speed up the delivery of innovations and new products.

Mathers said grid computing has greatly sped up the company's ability to test the effects of molecules on proteins. Through grid computing, J&J is now able to take a three dimensional model of a protein structure and virtually insert small molecules in order to measure the interaction.

Prior to grid computing, these compounds and molecules would need to be synthesized in a lab, a process that could take up to three months. Now, he says, the entire testing process takes about two weeks.

"It's a really valuable technique," Mathers said. "We have theoretical libraries of compounds that we don't even have (synthesized) and can screen huge numbers of molecules."

Relational DBMS market rebounds

By Robert Westervelt, News Writer
27 May 2004 | SearchDatabase.com

The relational database management software market grew by 5% last year, and IBM held onto its lead for the third consecutive year, according to a Gartner Inc. study released Wednesday.

Sales of RDBMS software reached $7.1 billion in 2003.


IBM is not converting customers to DB2 on Linux as they had hoped, so the real growth that IBM had was on mainframe, where they have no real competition.

The three largest database software vendors maintained their spots in the market, with IBM grabbing about 36% of the market, fueled by the success of its DB2 database on iSeries midrange servers and zSeries mainframe hardware, according to the report.

"We're seeing increased spending as enterprises free up resources and the economy continues to rebound," Kevin Strange, principal analyst for Gartner.

Oracle Corp. lost overall market share for the third straight year, taking 32.6% of the market. But it surged ahead in Linux, grabbing $207 million in sales, accounting for 69.1% of the overall Linux database market.

Microsoft's SQL Server gained a market share point in 2003, for a total of 18.7%.

Strange said that a new battle is being waged on the Linux platform, where IBM is losing ground steadily.

In 2002, IBM led the Linux market with $67 million in sales, and Oracle had only a $45 million share.

"IBM is not converting customers to DB2 on Linux as they had hoped, so the real growth that IBM had was on mainframe where they have no real competition," Strange said.

Oracle is seeing huge increases in Linux sales in data warehouse environments where critical data is stored, Strange said.

"When customers go to Linux, they are paying 50% more license fees to Oracle and because of that Oracle is getting a nice pop," Strange said. "Unless something negative happens in the Linux world, I don't see this trend slowing down."

DB2 achieved strong overall growth as a result of IBM's independent software vendor (ISV) program, which focuses on penetrating the small and midsized business market, Strange said.

In a press release issued in response to the report, Oracle praised its performance on Linux and disputed how Gartner defines the market. Gartner defines the relational database management market as software running on Windows, Linux, Unix and two versions of IBM's programs for mainframe and mini-computers.

"Oracle remains, by far, the market share leader in the modern relational database market on UNIX, Linux and Windows platforms," said Robert Shimp, vice president of Oracle. "Particularly in the new, rapidly expanding Linux market, Oracle is solidifying its position, with the highest growth and largest market share of any vendor."

Carving a niche for ourselves - IBM's winning plays
1. seize the initiative and establish leadership in biz value.
2. drive hyper-growth in banking, gov and SMB.
3. establish critical infrastructure and industry-specific open stds.
4. dramatically grow our systems share.
5. reinvent processes and incentives to drive profitable growth.
6. shape the external biz environment to support IBM strategie

May 10, 2004
Hardware Today — Mainframes Remain Main Event for Some
By Ben Freeman


Mainframes may not be the next big thing or front-page news these days, but they aren't out of the running, either.

The latest batch of stats from IDC offers proof of this. In the fourth quarter of 2003, x86 servers had the most growth: Revenue was up 15 percent, and unit shipments were up 23 percent. However, Unix sales increased marginally (0.8 percent to be exact), and two vendors had substantial mainframe victories. Sun, in third place, posted 18.2 percent unit growth, the strongest year-over-year showing in that department among the five major players, and IBM, in first place, achieved 33 percent unit growth in OS/390 sales.

Today's mainframe is often deployed in server environments where ROI and consolidated infrastructure are of prime importance. This week, Hardware Today takes a close look at three mainframe vendors, IBM, Unisys, and Sun, as well as some recent deployments.

Still Thinking Big With Big Blue

As Gartner anticipated in last year's "Predicts 2004: Future of the Mainframe," IBM has continued to innovate its eServer zSeries mainframe line. But the $1 billion Big Blue invested in the z990 leading up to its May 2003 product launch pales in comparison to the $5 billion it shelled out in 1964 to develop its first mainframe, the System/360, which was first unveiled in April 1964.

One early System/360 adopter, Aetna Insurance, has been loyal to mainframe computing and IBM since it began using mainframes in 1965. "The transaction-processing capability of the mainframe allowed Aetna to start automating the process of creating an insurance policy," and IBM spokesperson told ServerWatch. "Until then," he said, "policies were handwritten and mailed to the home office."

Today, a paper to mainframe migration is unlikely, but IBM mainframes remain compelling. "The more security and compliance concerns emerge as the key issues for companies across the board, the more frightening the idea of a distributed, decentralized IT infrastructure becomes," IBM said. Instead, managers "want to house their data and applications all in one place on a platform that will never go down."

Sparkassen Informatik (SI) was one company looking for a system with such reliability. The leading German retail banking solutions provider spent millions this year deploying 20 IBM eServer zSeries z990s to simplify its infrastructure and more than double processor capacity.

Another recent IBM mainframe victory also came from the bustling world of German finance. The German Federal Financial Office recently replaced 30 Sun and Fujitsu-Siemens Unix servers with a single IBM zSeries z990 running Linux for its back-office operations. The move, according to IBM, reduced TCO and bolstered efficiency by consolidating infrastructure. zSeries mainframes running Linux challenge popular conceptions of mainframes being limited to proprietary operating systems.

Unisys on the Edge

Unisys' history traces back more than a century. Its mainframes received mainstream notice when the UNIVAC-1 predicted Eisenhower's landslide in a projected close race. The early Unisys systems also provided some unanticipated side benefits. "These early systems were so large that our engineers used to walk into them. to enjoy the effect of their powerful internal cooling systems," Chander Khanna, Unisys vice president of platform marketing said.

Unisys can even take credit for being the originator of industry jargon: Former-Navy Rear Admiral Grace Hopper, a UNIVAC and COBOL pioneer, coined the term "computer bug" when she found a moth in trapped a room-sized early mainframe.

The Unisys of today is the offspring of many mergers, and the company has always had to play a balancing act to incorporate new products into its portfolio. Recent customer victories have entrenched its high wire walk, particularly in the area of mainframe service and sales.

In 2003, Unisys added 76 new customers on the strengths of its Web-enablement focus, through which mainframes are deployed primarily for apps on the network edge. They "are taking advantage of the Web as a way of accessing and harnessing the power of totally reliable, scalable, and secure mainframe applications in a more open distributed way," Khanna said.

As further proof of the vendor's edge-prominence he cited a recently inked deal for which JBoss will use Unisys mainframes to run JBoss Mainframe J2EE. "This allows customers to leverage their mainframe technology and investment with readily available programming skills and applications," Khanna said, "helping clients achieve the best of both worlds — the mainframe world and the open, distributed world." In certain Web hosting environments — the edge of the edge, perhaps — customers protect their investments and further reduce TCO with consolidated mainframe infrastructure.

Sun's Not-Quite Mainframes

Sun Microsystems has taken an aggressive approach to the mainframe space, urging customers to rehost IBM mainframes on its mainframe-like Solaris 9 SPARC systems. "Sun has proven there are real value points for mainframe features in the Unix world, developing innovations ... that others are now trying to copy," Sun vice president of marketing Steve Campbell said.

Campbell emphasizes that Sun's systems are not mainframes. At least not in the sense that "mainframe computers are costly, complex, closed systems that our companies are finding to be a tremendous expense." Migration to a Sun "Unix 'mainframe'" means "no more programmers specializing in COBOL."

Recent Unix "mainframe" victories for Sun include Transamerica Life Canada, which moved its applications to Sun SPARC servers and cut costs by 50 percent. It also achieved ROI in six months, and boosted system performance by 25 percent, Campbell added.

On the IBM rehosting front, German steel magnate Böhler Edelstahl GmbH, recently migrated from IBM zSeries 900s to Sun Fire servers running Solaris 9. "Böhler Edelstahl expects to realize a substantial return on investment and reduce operational costs up to 40 percent," Campbell said.

Moving Toward Modularity

Sun is pushing its mainframe approach as more modular, and Unisys and IBM are moving their mainframes to more open standards with respective Windows and Linux options.

This puts the three vendors in more similar boats than Sun would probably care to admit. Sun is still touting its Solaris operating system as a salve to proprietary problems, while also having hedged its bets and moved toward the x86 architecture with its Sun Fire server and April announcement of a closer relationship with Microsoft. Unisys and IBM today also offer, and rely heavily on, non-mainframe options.

But all three (as well as various other vendors) continue developing mainframe solutions, and real-world enterprises are finding value in them. The key, of course, is finding which solution makes the most sense for your organization

EMC users suffer software headaches

Several large EMC users at the Storage Decisions show in New York last week would consider switching to new IBM or Hitachi products coming later this year, given the chance, SearchStorage.com has learned.
The primary reason, according to the majority of users we spoke with, is storage software problems.
LexisNexis recently purchased EMC's Controlcenter software to automate planning and provisioning tasks, but the software only added time to the problems LexisNexis already had, according to Greg Zastrow, manager of storage systems engineering at LexisNexis. The company has approximately 300 TBs of storage, 90% of which sits on EMC Symmetrix boxes.
"We tried to add Controlcenter but it was impossible; it should take 2 days to install, but it took several weeks," Zastrow says. When LexisNexis makes its next EMC purchase, which it will do soon, EMC has agreed to throw in some professional services support to help the company out of its Controlcenter fix.
In the meantime, LexisNexis is evaluating its options.
"We are thinking about positioning with a single server and storage provider for better pricing across the board and better end-to-end integration," Zastrow says. The most likely choice is IBM for mainframe storage and HDS for distributed storage. "We're not going to get rid of EMC quickly, but we don't want to have 3 vendors," he says.
Once bitten, twice shy
It turns out that LexisNexis isn't alone in its struggles with EMC software. Another user we spoke with, who would only tell his story on condition of anonymity, is finished with EMC. Right now, the company considers itself an "EMC shop" with 10 TBs of storage on 2 Symmetrix boxes. It recently purchased a Clariion CX600, and says it won't do that again.
"It's been disastrous," the source says. "We are looking outside now, primarily at HDS." In this instance, EMC couldn't get the same snapshot and mirroring functionality running on this company's Symm boxes to run on the CX600.
"Beyond a certain point of trying, they [EMC] gave up…How many people and how much time do you want to waste trying to fix something before it makes sense to just get in a new system?" the source says.
EMC ended up replacing the CX600 at this company with a DMX800 after two separate teams couldn't get the snapshot feature to work.
Other companies would like the chance to consider other vendors besides EMC, but their hands are tied. Lehman Brothers, which has 250-300 TBs of SAN storage and about 100 TBs of NAS, has just completed a technology refresh with EMC's latest DMX products. "The TCO [total cost of ownership] is kept down based on keeping the same vendor," says Dat Truong, vice president of storage engineering at Lehman Brothers. Whatever the problems, he says Lehman's expertise in-house is on EMC hardware and consequently that's what the company continues to buy.
The consensus among EMC users we spoke with, particularly among the financial community, was a need for better overall management. Users are desperate for tools that help them to see all the storage they have, not just EMC, and then a way to maximize the capacity they already have on these different systems for varying types of storage. So far, they say, no one is offering them this.

Mainframe Data
Our friends at Informatica shared this information with us. According to a study by the market research company IDC, 75 percent of large enterprises maintain data on mainframe computers. More than half of all corporate data resides on mainframe platforms in 45 percent of the enterprises surveyed. That corporate data is the lifeblood of the organization. It has to be available where needed.

IBM takes up data centre lease with SingTel
It's setting up IT infrastructure facility, offering e-business services
By Raju Chellam , Business Times
4 May 2004


IN a unique deal to help large enterprises in the region keep their corporate data secure, IBM Corp says it will invest $39 million to set up an IT infrastructure facility as well as offer companies e-business services and IT outsourcing solutions.

Big Blue will initially invest $21 million with Singapore Telecommunications to lease a large part of a 300,000 sq ft data centre maintained by SingTel. The lease will run for about 10 years.

IBM will invest the remaining $18 million on an Internet Business Exchange centre run by Nasdaq-listed Equinix Inc in Singapore. This will offer Singapore companies data hosting, disaster recovery and outsourcing services.

IBM says it will initially offer these solutions to large enterprises in the transportation, financial services and manufacturing sectors. 'That's because they deal in huge amounts of constantly changing data that must be kept secure under any circumstances,' Francis Fong, general manager for strategic outsourcing at IBM Global Services, tells BT. 'The facility will also act as a disaster recovery centre.'

A SingTel spokesman says the IBM contract is one of the largest data centre leases taken so far in Singapore. SingTel runs four large data centres here under its Expan branding - two in the central business district, and one each in Tampines and Kim Chuan. IBM and SingTel did not specify which data centre will host IBM's technology offering.

Mr Fong says IBM will debut its suite of Universal Management Infrastructure (UMI) productivity solutions for data centres first in Singapore. 'Companies may choose to have an on-demand operating environment built and managed by IBM at the data centre or at their own data centres outsourced to us,' he says. 'That way companies can focus on their core businesses without worrying about managing the data centres' needs.'

SingTel's CEO of its managed hosting services, Lee Han Kheng, says Expan offers a pan-Asian chain of data network centres that can help multinationals, Internet and application service providers across Asia to outsource their communication networks and managed hosting needs to SingTel.

'Expan is available from data centres in Australia, Hong Kong, Japan, South Korea and Taiwan,' Mr Lee says. 'We also offer hosting services through partners in China, India, Indonesia, Malaysia, Thailand, USA and the Philippines.'

Phil Koen, head of Equinix Asia-Pacific, says the company has been providing data infrastructure facilities to IBM for the last three years in the US. 'Our facilities offer a high-performance data centre environment for outsourced IT operations,' Mr Koen says. 'They feature redundant power, multiple layers of security, access to an aggregation of networks and service providers, and the flexibility to rapidly expand operations if required.'

For data hosting - and recovery - Singapore has more than one million sq ft of data hosting space on demand. About 15 companies - which include SingTel Expan, iSTT, Global Switch, and NTT Communications - use Singapore's data hosting infrastructure.

According to International Data Corp, the Asia-Pacific region's market for disaster recovery is set to grow from US$551 million in 2001 to US$1.3 billion by 2006. 'Australia, South Korea and Singapore currently account for the bulk of a market that's growing at 20 per cent per annum,' IDC said. 'The turbulence around the world has created a strong interest among organisations in the Asia-Pacific for disaster recovery services.'

IBM Global Services is the world's largest IT outsourcing services provider. It employs 200,000 professionals in 170 countries and grossed US$48 billion in global revenues last year. Its global customers include JP Morgan, American Express, Nokia and ABB.

IBM's service science
By Michael Kanellos, CNET News.com
Friday, April 30 2004 10:58 AM

For years, IBM has been one of the world's leading research bodies when it comes to semiconductors, databases, electron microscopes and other "hard" sciences.

Now, Big Blue is getting into social sciences.

The company's Almaden Services Research group, a 22-employee outfit based in Silicon Valley, has set out on a mission to discover--and then hopefully exploit--quantifiable, predictive principles that underlie the delivery of technology services.

In other words, IBM is combining anthropology, game theory and behavioral economics with technologies from its labs to see if it can make corporate processes run smoother. The first person recruited from outside IBM to join the group was, in fact, an anthropologist.

"A lot of social-science research has been performed on emerging, indigenous cultures," said Jim Spohrer, director of the group and the former chief technical officer of IBM's venture arm. "But the cultural variations inside of businesses are just as varied as those in the jungles or deserts."

The goal of the program essentially is to better marry the company's extensive research division to the fast-growing services group.

In 2003, the group worked on some 100 customer projects in the On Demand Innovation Services program. Assignments have included finding a way to implement speech-recognition systems so that customers or employees would actually use them.

But Spohrer admits that he has loftier ambitions, too. His fantasy goal for the group is to win a Nobel Prize in economics. In an early assignment, staff members had to read the major works of previous winners of that prize.

For many physicists and chemists, of course, the social sciences often rank up there with numerology and voodoo--amusing, but not really science. An electron can't lose its charge, but die-hard progressives can, one morning, start watching the Fox network.

Anthropology, in particular, is suspect. It's the college major of every parent's nightmare. As a joke, a friend and I once wrote a treatment for a business book we would have called, "Management by Maya--How the Secrets of the Ancients Can Improve your Bottom Line." It provided lessons from ancient cultures (along with tips on handling a jade disemboweling knife.) We didn't get a publisher.

Still, the dynamics of human behavior, especially in large groups, can be encapsulated to a certain degree. One of the lessons learned in the movement toward industrial automation in the '70s was not to automate too much, Spohrer noted. Employees got bored, because they had little to do, and when a crisis arose, they couldn't handle it.

Over time, companies building those systems changed them so that there would be a more constant stream of human-machine interaction.

"How do you take social change and reduce the time to implement it?" is the question at the heart of this type of work, according to Spohrer.

Moreover, the need to get a better grasp of human organization has become pressing. In 1945, approximately 60 percent of the U.S. work force was employed in the manufacturing sector, according to statistics from the U.S. Department of Labor.

Now, roughly 50 percent of that employee pool has an office job. The dynamics of office work, however, are not completely understood. Companies often try to tweak the compensation plans for sales representatives, and then they find that they spend most of their time trying to swipe accounts from each other.

Corporations are notorious for introducing technology without considering the human consequences.

Eric Johnson, a professor at the Columbia Business School, has found that maximizing "stickiness"--or increasing the time a customer spends on a Web site--is actually a bad goal for e-commerce companies to pursue. Stickiness usually connotes that customers are getting lost on a Web site. By contrast, Amazon.com has seen revenue rise and stickiness decline, because easy navigation brings customers back.

Other studies have shown that the number of employees that participate in employee retirement plans changes drastically when default settings are slightly adjusted on the Web-based enrollment form.

"Defaults are probably the most important decision you can make on Web sites," Johnson said.

IBM's foray into the social sciences is only about a year old, but progress is being made fairly rapidly. In May, academics from the University of California at Berkeley, Harvard University, Northwestern University and elsewhere will converge at IBM in New York for a faculty summit on organization theory. Spohrer's group is also digging around IBM for interesting projects to tie into.

One promising area of development is the combining of these techniques with IBM's data-mining research. Ideally, systems could be developed that would allow humans and machines to detect bank accounts that are serving to fund terrorist activities.

Over time, institutions may be able to carve out enough data and concepts to give shape to academic disciplines focused on these areas.

"Humans are intentional agents, and intentional agents can resist or accelerate change," Spohrer said. But studying that problem "is exactly what we have to do."