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Powering the Market Now and Into the Future

Analysts Richard Ptak and Bill Moran take a closer look at what’s next for POWER.

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Early on, IBM positioned the POWER architecture, including chips and systems, to be the market alternative that would break Intel’s dominance in microprocessor chips and systems. POWER9 was to be a major step forward in accomplishing that objective both in terms of chip marketing and functionality. With POWER10 looming on the horizon, it makes sense to do a status check on IBM Power Systems and POWER9. 

Business Ranking

First, let’s examine the business points relevant to POWER9.The Wall Street Journalrecently published a ranking of the best managed companies in the US. We, along with most business/technology executives and analysts take such WSJ rankings very seriously. We reviewed the evaluation methodology used by the WSJ in cooperation with the Drucker Institute at Claremont University. It appeared to be reasonable and well thought through. 
In published WSJ rankings, Apple held the top position, followed next by Amazon, Microsoft, Alphabet and Intel followed in that order. In fact, seven of the top 10 rankings are held by technology companies, including IBM in 10th. 
Both HPE and IBM had been struggling as they attempted to make the transition to a global technology market world dominated by hybrid clouds, AI and big data. HPE’s ranking was no real surprise; IBM’s ranking is a testimonial to their ability to enter an aggressive competition with cloud service offerings. While HPE was unable to recover effectively. IBM has succeeded, not the least due to their aggressive expansion especially via the successful 2013 acquisition of SoftLayer Technologies Inc. and strategically bolstered by the Red Hat acquisition in 2019. 
We have to mention that the organizational shuffle with the retirement of Ginni Rometty, which elevated Arvind Krishna to CEO and Red Hat CEO Jim Whitehurst to IBM president appears to us to be a very promising move. Krishna has a strong, broad background in technology and played significant roles as IBM adjusted its product mix, and he is no stranger to the Power Systems platform. Jim Whitehurst has proven ability to grow and develop the Everything-as-Open software market with Red Hat Linux, where OpenPOWER is a strong player, which means he can appreciate the potential of the POWER platform.

Creating Benchmarks for IT Infrastructure

One way to objectively compare technologies is to run a vendor developed benchmark, i.e., a series of applications demonstrating various device functions or functionality. For a large sale or procurement, vendors were willing to spend a significant amount of money to design and execute these (essentially) marketing demonstrations. 
This led to another requirement. Potential customers began to demand that the vendors use the same benchmark data to compare different systems. Unfortunately, there does not seem to be any economic, straight forward and valid way to do so, and results computed by vendors were inherently biased. 
This situation gave way to Industry Standard Benchmarks. The idea was to create benchmarks that could be run without material changes on a wide variety of vendor systems. The concept was that these benchmarks would allow customers to compare the performance of different vendor offerings with a high degree of reliability across many different dimensions, including five-year cost. 
Benchmarks can be expensive to create, but in the real world there are benchmarks comparing different vendors that have high credibility. One example is from independent consulting firm ITIC Corp., which publishes how 800 respondents view the reliability of a variety of vendors’ server offerings. (

The Future of POWER9

Since November 2018, Summit and Sierra, both with POWER9 architecture, have ranked as the top two supercomputers in the world. Looking forward, IBM has taken some practical steps to guarantee the future of POWER9 including establishing the OpenPOWER foundation, which has been increasing the number of vendors marketing and supporting the architecture.  Also, the decision to license the OpenPOWER architecture has greatly expanded its attractiveness. 

Implications for Clients

The largest current group of IBM clients consists of those who are running on older versions of Power Systems hardware and wish to continue with the technology. They need to be aware of two things:
1. Avoid the tendency to simply continue operating on autopilot. Instead, be aggressive in actively evaluating options to assure you are getting the most out of the technology. 
2. Carefully review the requirements of new areas, such as: big data, AI, machine learning and the evolving hybrid cloud data center operations
There will also be many new Power offerings from IBM partners resulting from the licensing of the Power architecture. The competition will be an obvious benefit as you compare offerings and choose the best match to your business needs. However, carefully consider your specific needs for maintenance and support before putting any new technology into a production environment.
The second group of customers to address consists of those evaluating the technology of POWER9 (or subsequent releases) for the first time or for a new application. These clients can expect the same benefits as mentioned above. Prior to decision making, it’s necessary to carefully think through what is needed to assure the new technology will be successful in a production environment. 
It’s important that the requirements of both IT and the enterprise group intended to use the application are clearly understood and considered. For most companies today, production requires ongoing collaboration between the enterprise business unit and the IT department. It’s important to consider how this process in your specific company. What must the enterprise/business unit do to transfer work to IT? Have you checked with other departments and enterprise/business units to find out their procedures? Identify conflicts? Mutual benefits?
Understanding these helps to uncover (and avoid) potential pitfalls and reveal best practices. Identify expectations and determine who is responsible for deciding these are satisfied. We frequently see failures in this area, either because a risk is overlooked, or because optimistic assumptions led to sloppy execution.
We strongly recommend scheduling a formal meeting between the unit(s) involved and the IT department. The outcome should be a written agreement for how the process will work with responsibilities, checkpoints and key performance indicators identified. 
Pay close attention to identifying and tracking potential budgetary and service level issues. Remember no technology can be a success unless it is able to scale to meet defined operational needs. These considerations are not unique to the Power Systems platform. The concerns and processes apply to the adoption and introduction of any new technology. 

Summary & Conclusions

The business status of IBM remains strong. As mentioned earlier, the organizational shuffle as Ginni Rometty retires brings to power Arvind Krishna and Jim Whitehurst. These two bring significant product and market understanding and experience in areas important to the future of the Power Systems platform. 

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