In gratitude for the granting of a knighthood to chairman Tony Cleaver, IBM UK Ltd has given its computing public an unprecedented thank-you. It is something the British will undoubtedly appreciate far more than would any other people in the world: a mystery. With the announcement of the AS/400 E series, IBM has ceased publishing list prices. As a result, IBM may deservedly witness its AS/400 revenue wither and its profit (assuming there is any) head for the more distant antipode. If there is no such reaction – if IBM succeeds with its scheme buyers of the make me an offer AS/400s will be the object of moron jokes told by people from Essex. It is clear to everyone (with the exception of IBM) that customers buy AS/400s because of the system’s certainties – a standard database system on which all applications depend, the cadre of loyal IBM engineers whose services are co-ordinated by the computer family’s built-in diagnostic code, a uniform personality across an extraordinary performance range and so on. Consistent with this is open pricing. While many users have been able to negotiate off-list prices as they install their first systems, the AS/400 market is primarily one of upgrades. These upgrades most often come from IBM and are almost always purchased at list price. Because these prices have been published, computer experts have been able to develop the budget for a company’s computing strategy, present it in written form to a conservative corporate management and, in stark contrast to so many other aspects of the computing game, live to see their forecasts survive a few years. By removing this buttress, IBM has well nigh guaranteed that the entire structure around which AS/400 customers build their information processing empires will crumble. The subsidence will occur across the entire user base, with each site suffering the moment it considers an expansion plan. Computing professionals that have pegged their careers to the certainties of IBM’s AS/400 are now at great risk. There is absolutely no benefit to the customer of an invisible price list. But for IBM, there is a great advantage, one it undoubtedly hopes will lead to profits made not by building superior computers but rather by bilking still-trusting customers. No longer will an IBM sales rep – or an independent agent selling IBM kit – have to learn about bits, bytes or billing systems. Sales training can now confine itself to the reading of subtle signals in a customer’s eyes that indicate naivete and submissiveness. Long live Sir Tony Cleaver! We now look forward to the knighting of Nick Temple, for whom (and whose corporate domain) Her Majesty may see fit to create the Order of the Weasel. – (C) Hesh Wiener
