Article

IBM buys former adversary and mainframe startup PSI

Mark Fontecchio
IBM Corp. and plug-compatible mainframe startup Platform Solutions Inc. (PSI) moved their battle from the courtroom to the negotiating table, and now Big Blue plans on buying its onetime adversary.

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Since late 2006, the two have been engaged in a lawsuit in which IBM sued PSI for patent infringement on its z/OS operating system. In early 2007, PSI countersued, alleging that IBM had shut out competition by coupling z/OS with its own hardware.

Since then, motions have been filed back and forth, but nothing has been settled. Until Wednesday, July 2, that is, when IBM announced it would acquire privately owned PSI. Financial details of the deal have not been disclosed.

For more on IBM and PSI mainframes:
IBM sues plug-compatible mainframe startup

IBM countersued by PSI over plug-compatible mainframe

PSI consolidates IBM mainframe, Unix, Linux and Windows on single box

On Thursday, July 3, an IBM spokesperson said that IBM officials were unavailable because of impending meetings with PSI officials during the holiday. In terms of a roadmap, the spokesman, Charles Zinkowski, said that IBM does "not have plans to immediately release products solely on PSI technology – this acquisition is about long-term plans, and we are not disclosing specific roadmaps today."

Zinkowski also declined to say when the two companies' lawyers stopped filing legal briefs and started negotiating the acquisition deal.

Two PSI officials could not be reached for comment.

Future OS offerings a question mark
David Reine, the director for enterprise systems at Wellesley, Mass.-based research and analyst firm the Clipper Group, , said much of how the deal works requires a wait-and-see approach.

PSI serves as a very good alternative to the lower-end zSeries.
David Reine
Director for enterprise systemsthe Clipper Group

"You could say that PSI serves as a very good alternative to the lower-end zSeries," Reine said. "IBM probably wanted to take advantage of that technology, being able to see z/OS and Windows and Linux on the same platform."

"We'll need to wait a couple months to see how it all filters out," he added.

PSI's servers are based on Intel Corp.'s Itanium processor and can run z/OS, HP-UX, Windows and Linux. It's unclear whether Big Blue will continue to offer this kind of flexibility when PSI becomes part of IBM. Currently IBM's System z mainframes support z/OS, z/VM, z/VSE, and Linux. There are plans to get Solaris running on z but it is still in the works. As for HP-UX and Windows, it's unclear whether IBM would run those on System z-branded hardware.

Ron Avery, the operating system manager in Polk County, Iowa, said he's optimistic about the deal. Avery runs a 50 million-instructions-per-second Liberty Server that the company bought from T3 Technologies Inc., which has a licensing and distribution deal with PSI. Avery said that, in early 2007, Polk County was the first shop to bring the Liberty Server into production.

"Probably overall I view it as positive at this point," he said. "It at least gives IBM the capability to provide better price points for small to midsized mainframe shops out there. The other benefit I would expect to see is that IBM will handle pricing from a software perspective for smaller clients, and we might see future cost savings on operating system and ISV [independent software vendor] software costs that run in a classical mainframe environment."

Avery added that he believes that IBM has the financial and technical wherewithal to keep the PSI server line "robust and vibrant, and we would expect that they would do so."

Zinkowski noted that each existing PSI customer will be contacted and plans "will be constructed to fully support each customer's specific technology requirements."

T3 Technologies, which has a licensing agreement to resell PSI technology under its Liberty Server brand, will continue to support its existing customer base and is "not affected by the acquisition of PSI by IBM," President Steve Friedman said.

"Suffice to say that we have been virtually prevented from selling any Liberty hardware after the first six customers," he said. "Without access to the operating system, it's hard to sell hardware."

In the lawsuit between PSI and IBM, T3 filed its own motion in support of PSI. Friedman said that motion, as well as an anticompetitive claim against IBM that T3 filed with the European Union, is still on the table. As for whether T3 might be the next company IBM snatches up, Friedman would say only that "at the moment, we're continuing on as we have been and supporting our existing customer base."

Let us know what you think about the story; email Mark Fontecchio, News Writer. You can also check out our Server Specs blog.


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