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Virtualization - EC Asks Questions About IBM's Mainframe Business

EC Questioning Due to the Complaint the PSI Made Against IBM Last October, Charing it with Violation Article 82 of the EC Treaty

IBM may be starring down the barrel of an EC investigation of its precious mainframe business, significant to its bottom line.

According to both Bloomberg and Dow Jones, the commission has sent Big Blue a questionnaire asking for details about its mainframe business practices and questionnaires have a way of leading to formal investigations.

The EC is asking because of the complaint that Platform Solutions Inc (PSI) made against IBM last October, charging it with violating Article 82 of the EC Treaty, the very abuse-of-dominance provision used to nail Microsoft, a charge IBM ironically urged the EC to find against Microsoft.

PSI told the EC that IBM won’t give it the interface information and licenses it used to give plug-compatible makers when there were plug-compatible makers.

IBM is the only remaining mainframe maker and may be in something of a pickle here since back in the 80s it promised both European and US regulators that it would always make what PSI wants available to competitors to make the mother of all antitrust actions go away.

PSI is a would-be competitor with a so-called Itanium-based Open Mainframe that can run IBM’s z/OS – as well as Windows, Linux and Unix – only IBM is attempting to block it from marketing the thing.

PSI is highly reluctant to talk about its EC complaint, but marketing VP Christian O’Reilly confirms that the commission has been back asking PSI questions multiple times, which suggests that this isn’t the first questionnaire IBM has gotten.

IBM told the SEC and its stockholders it answered questions about the PSI complaint last year.

PSI, an Amdahl spin-off funded by Intel and Microsoft, among others, also has a major antitrust suit lodged against IBM with the US courts in answer to IBM’s suit charging PSI with patent infringement, a charge IBM made without examining PSI’s machine.

The allegations made to the EC echo PSI’s suit.

And speaking of the suit, PSI the other day asked the court of a summary judgment on IBM’s claims of trade secret misappropriation and tortious interference with contractual relations, practically the only documents in the case not under seal.

It claims IBM’s actions are a smokescreen, intended to eliminate competition.

PSI calculates, based on IBM’s Q4 numbers, that 40% of its software business and perhaps a third of it services revenues are ultimately driven by mainframes, making worth about $30 billion a year. Something like 60%-70% of corporate data is controlled by the mainframe.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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