In-Depth

March Inside IBM

• 03/01/2000

IBM Tops UNIX Server Study

IBM’s UNIX servers have received the highest commercial ranking in a composite benchmark-testing study of server performance. The independent study, conducted by D.H. Brown Associates, ranked IBM’s high-end UNIX servers number one, ahead of HP and Sun, which placed second and third, respectively. The new RS/6000 S80 server was singled out as helping IBM gain performance leadership. Other IBM UNIX systems contributing to the win include the RS/6000 SP and S70.

This D.H. Brown study compares server performance by using a weighted average of several industry-standard benchmark results that measure general commercial applicability, online transaction processing, decision support and enterprise resource planning. The result is an overall numerical ranking, or a "Composite Performance Metric," designed to help gauge all-around server performance.

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IBM and Cisco Systems Inc. are working together to provide customers with a technology foundation for e-business solutions. Using IBM S/390 servers, IBM Host Integration software and Cisco’s network systems, the companies will work to make advanced e-business solutions that can both drive and support the growth of high-volume Internet transactions. IBM S/390 and Cisco will also identify other standards-based technologies to enhance S/390 and Cisco’s advanced IP infrastructures with additional testing.

The development and testing of the IBM and Cisco products will yield e-business solutions that reduce infrastructure complexity and speed deployment. One set of functions will provide Quality of Service in mixed traffic environments; IBM S/390 traffic prioritization coupled with Cisco priority enforcement within the IP network will help ensure that users can receive more predictable response times. Another set of functions will highlight the coupling of S/390 Parallel Sysplex clustering technology with Cisco intelligent workload balancing to provide greater e-business transaction availability and scalability.

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IBM and Maconomy Corporation have entered into a strategic alliance to deliver ASP-based solutions for service companies across Europe and the U.S. Maconomy software, hosted by IBM, will deliver Web-based e-business solutions to service companies, extend Maconomy’s offering of Web-centric business software for service industry automation, and include wall-to-wall support of intra-corporate processes and inter-company business integration.

It will also combine Maconomy’s Corporate Application Service Provider networking technology (C-ASP) with IBM’s offerings in the field of e-business, consulting and system support.

For more information, visit Maconomy’s Web site at www.maconomy.com.

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IBM has established a $500 million global fund to enhance its Net Generation financing program and expand its support to fast-growing, business-to-business Internet companies.

IBM Global Financing will team with select venture capital firms to provide financing for IBM hardware, software and services to emerging Net Generation companies that have already completed their first round of venture capital financing. IBM intends to expand its relationships with venture capital firms that have Internet companies in their portfolios, and will offer these companies access to additional capital for growing their IT infrastructure.

IBM has more than one billion dollars (aggregate) committed to Net Generation companies, in programs that include funding in venture capital firms that specialize in developing Net Generation companies; acquiring start-up ventures; and leasing, financing and rent-to-own offerings.

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Although Y2K lockdowns took their toll on IBM’s fourth-quarter earnings, e-business service bolstered 1999’s total revenues by 7 percent. IBM’s fourth-quarter 1999 diluted earnings per common share of $1.12 compared with diluted earnings per common share of $1.24 in the fourth quarter of 1998. Fourth-quarter 1999 net income was $2.1 billion, compared with 1998’s fourth-quarter net income of $2.3 billion. Revenues totaled $24.2 billion, a decline of 4 percent, compared with the fourth quarter of 1998.

The company’s total gross profit margin was 36.7 percent in 1999’s fourth quarter, compared with 39.0 percent in the 1998 fourth quarter. Total fourth-quarter expenses declined 9 percent, and the company improved its expense-to-revenue ratio by 1.5 points year over year to 24.4 percent.

Net income for the year ending December 31, 1999 was $7.7 billion, or $4.12 per diluted common share, compared with net income of $6.3 billion, or $3.29 per diluted common share, in 1998. Revenues in 1999 totaled $87.5 billion, an increase of 7 percent as reported and in constant currency, versus revenues of $81.7 billion the previous year.

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IBM has signed an agreement to purchase Accessible Software Inc., a company specializing in an object-oriented approach to mainframe management. IBM’s Tivoli Systems will control and manage Accessible Software.

Accessible Software will become part of the Tivoli Enterprise Business Unit, headed by Senior Vice President and General Manager Bob Yellin. This unit develops and markets Tivoli’s flagship Tivoli Enterprise product solutions, which includes its OS/390 enterprise software management products.

Accessible Software’s Access 1 product allows customers to integrate the management of their OS/390 resources with their distributed and networked assets, providing a "one-view" look into the IT infrastructure from a centralized console.

For more information, visit Tivoli at www.tivoli.com, or visit Accessible Software at www.accessiblesoftware.com.