IBM data center offerings... a la iTunes

IBM is developing what may be characterized as an iTunes-like model for data centers that will enable a business to download the complete application stack, run it and even turn over server management to the vendor who will run it remotely.

The iTunes analogy came from Frank Gens, an IDC analyst who spoke at the IBM PartnerWorld conference in Los Angeles, who said he foresees this data center delivery model arriving from all the major vendors.

But Gens' reference to Apple wasn't disputed by Bill Zeitler, the senior vice president and group executive of IBM Systems and Technology Group, who said the characterization was "very fair" and in line with the company's intentions under its Blue Business Platform, a offering still in development that'll be aimed at small and midsized markets.

People have been downloading applications online since before modems were invented. But one trend that has been gaining with vendors is over-the-Net delivery of complete software appliances, including the operating system and supporting applications -- everything needed to run the appliance, from the hardware on up. It's all part of the broader industry push at IBM and elsewhere to increase efficiency, decrease complexity and minimize the need for IT staff to integrate and configure the wares.

In some ways that's not a unique proposition even for enterprise-level products. Steve Mills, senior vice president and group software executive, pointed out in a press conference that IBM's AS/400 midrange system had similar characteristics when it was introduced, including operating system, database, networking, and security -- all aimed at bringing the cost of ownership down.

One press conference wag asked if this so-called iTunes model will mean the arrival of 99-cent applications.

Quipped Mills with a grin: "That's a scary thought."

But Mills also pointed out that pay-by-the-download business delivery is not going to be the best choice for many users, who have regulatory, certification and other issues to wrestle.

Business partners account for a major share of IBM's revenue, and this conference is a key one for the company.

It comes at a strange time. Though officially the US economy isn't in recession, the Los Angeles Times on Wednesday filled up half of its front page with charts showing rising gas and food prices, falling home sales, and declines in consumer confidence, all in fat red lines. But at IBM's conference here, the mood is bright.

IBM's earnings are beating analyst expectations, with first quarter revenue at US$24.5 billion -- up 11 per cent from the same quarter last year. Growth in the Americas was up 8 per cent at US$9.9 billion, but the rest of the growth is coming from overseas; in Asia Pacific, for instance, revenue was up 14 per cent to US$5.1 billion. Gens said he expects the rate of growth in the fast-expanding markets of the developing nations, including China, India, Russia, Brazil, to more than double that of Europe and the Americas.

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