IBM Offers Special Financing for Competitive Replacements to Power7 Systems

IBM Corp.’s Global Financing arm said it is offering favorable terms and conditions to channel partners for dropping certain installed systems from Oracle Corp.’s Sun Microsystems hardware and Hewlett-Packard Co. at customer sites in favor of the vendor’s Power servers.

The company said that its new financing program, which features trade-in credit for used equipment, interest-free deferral of payments and no payments until 2011, includes IBM’s mid-range and high-end Power7 systems. The trade-in credit can be applied to new Power7 lease payments.

IBM’s current financing deal builds on a promotion it tied to four new Power7 mid-range systems and a high end unit it unveiled in August in which it offered side-by-side migrations of a customer’s existing high-end Power system to the newer Power7 technology at competitive financing rates.

"We are giving HP and Oracle-Sun clients a way to trade in their old equipment for credit for new Power Systems and get a great leasing program to help manage costs," said Dan Ransdell, IBM Global Financing, North America general manager.

They can easily switch to IBM's latest workload optimized systems with leasing and an upgrade plan that protects against technology obsolescence," he said.

Under terms of the financing promotion, leases must be for transactions larger than $75,000. A lease entered into on or before October 1, 2010 carries a 120-day interest-free deferral for a 40-month term at fair market value. The lease term for agreements entered into after October 1 is for 39 months at fair market value with a 90-day interest-free deferral period.

Eligible IBM hardware is limited to the Power 770, 780 and 795 servers acquired by customers using the trade-in program. Designated Sun and HP Systems include the Sun SPARC Enterprise T5220/Sun SPARC Enterprise T5240, the UltraSPARC T1 based Sun SPARC Enterprise T200 and Sun M9000, as well as HP’s entire line of servers, including the Proliant DL380G5 and the Superdome.

Financing offer backed by channel support efforts

IBM said that in the second quarter of 2010, some 257 customers had migrated from Oracle and HP to IBM’s workload systems and storage. IBM also claimed to have won over from its competitors more than 2,600 companies since it initiated its migration program four years ago.

The vendor readily credits its expanding channel roster, which currently stands at about 2,700 business partners selling the Power hardware, 150 of which are certified under its Dynamic Infrastructure program, according to a company spokesperson.

IBM said it offers channel partners selling its Power systems an array of education and training, with a focus on understanding how to map the capabilities of the platform to specific scenarios and client requirements, the spokesperson said.

“We’re helping business partners to prepare for Power system selling opportunities with a wide range of specific industry and scenario selling enablement resources, as well as competitive positioning,” the spokesperson said.