I.B.M. Adds Mainframe Computers

Company News

By John Markoff
The New York Times

July 27, 1988

Reasserting its status as the provider of the most powerful commercial data processing computers, the International Business Machines Corporation yesterday introduced 10 mainframe computers and said it had begun shipping a new operating system that would increase the performance of those machines and its other most powerful computers.

I.B.M. said the new mainframes were 20 to 50 percent more powerful than existing machines. Analysts said the company could offer even more dramatic increases from configurations that chain as many as six processors.

The top-of-the-line computers completed I.B.M.'s enhancement in recent months of its entire product line, from personal computers to mainframes. Analysts said the changes would bring a stronger financial performance later this year and next year.

Timing a Surprise

I.B.M. has historically introduced its most powerful mainframe computers during the winter months, and the timing of this announcement surprised some analysts.

''What I.B.M. is trying to do is get a bigger window of opportunity and therefore larger revenues during 1988,'' said Bob Djurdjevic, an analyst at Annex Research in Phoenix. ''Over all I'm very impressed; this is more than I expected.''

I.B.M. said the low-end models announced yesterday would be available in September and the most powerful multiprocessor version of the new product line, called the Enterprise System 3090S, would be shipped during the fourth quarter.

''The mainframe business has been good worldwide and in the U.S.,'' said James A. Cannavino, an I.B.M. vice president and president of the data systems division. ''I do believe that there has been a breakthrough here that is going to spur the growth of large systems.''

Options Are Emphasized

Mr. Cannavino said a significant part of yesterday's announcement was the computer maker's addition of a variety of options for owners of existing I.B.M. mainframes. He said pricing was structured so that it is more cost effective to upgrade than to purchase a new system.

The new operating system, which I.B.M. announced in April, will give I.B.M.'s largest commercial and scientific users more efficiency and the ability to run significantly larger programs.

The hardware announcements were viewed by analysts as a response to a powerful mainframe computer introduced in May by the Amdahl Corporation of Santa Clara, Calif.

The Top I.B.M. Machine

The most powerful new I.B.M. machine, the Enterprise System 3090 Model 600S, consists of six independent processors that work together on problems. It is rated at 130 million to 140 million instructions a second by I.B.M., compared with the 113 million instructions for Amdahl's top machine, the 5990 Model 1400.

The I.B.M. Model 600S is priced at $12.4 million, compared with $13.1 million for the Amdahl machine. I.B.M.'s entry-level machine is priced at $985,000. Across the board the prices are 10 to 15 percent higher than those of I.B.M.'s existing mainframes.

''I.B.M. has re-established its leadership in the big mainframe arena,'' said Robert Fertig, an analyst at Enterprise Information Systems in La Jolla, Calif. ''Amdahl will have to offer some discounts or cut prices.''