IBM Pitches System i for Small Business SAP

Thu, October 12, 2006

CIO — IBM raised the stakes in its competition with Dell for small-business users on Thursday by launching a System i server configured for customers with 100 seats or fewer of SAP’s business process management (BPM) software.

Small businesses often lack an IT department, and tend to choose Windows-based systems for their low price, said Mark Shearer, IBM’s general manager of System i.

To attract those users, the IBM System i 520 Solution Edition lists a similar price to Dell’s PowerEdge server, but offers a closer integration of security, virus protection, database and storage. This combination could enable small businesses to manage all their data in a single spot, whether it’s used for accounting, supply chain, CRM, e-mail or disaster recovery, he said.

IBM’s move also marks a win for SAP, which competes for those same users against Oracle’s J.D. Edwards ERP software.

In July, IBM started selling a nearly identical product for Oracle applications, called the System i 520 Solution Edition for Oracle’s J.D. Edwards EnterpriseOne. That platform was a crucial step in Oracle’s campaign to keep the 5,000 users it inherited by purchasing PeopleSoft in January.

Now Oracle must share IBM’s fast hardware and aggressive pricing with its bitter rival. The two companies are locked in a public war of words and product launches. In July, SAP said it had explicitly designed its pending Safe Passage 2.0 migration program to win over Oracle users. And Oracle sells a product called "OFF SAP," which includes credit incentives for switching from SAP.

As a hardware vendor, IBM insists its servers are neutral ground, and that it plans to win over small-business customers by offering them a choice between Oracle and SAP.

The System i 520 combines hardware and software with the additional disk storage needed to support 100 SAP users, whether they’re using mySAP All-in-One, business intelligence, CRM, product lifecycle management or supply chain management. IBM will begin selling the package later in October for US$35,000.

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