Original URL: http://www.theregister.co.uk/2003/04/25/roll_up_ibm_is_giving/

Roll up! IBM is giving away hardware

ASU spills the beans

By Ashlee Vance

Posted in Servers, 25th April 2003 19:44 GMT

An Arizona State University representative committed one of the ultimate blunders in the delicate world of customer win announcements and did so at the expense of IBM.

IBM offered ASU a whopping 65 percent discount for a large computing system planned to be one of the 100 most powerful in the world, reports The Arizona Republic. For its generosity, IBM received this quote.

"They essentially bought the business," William Lewis, ASU chief information officer and vice-provost, told the paper.

ASU only ended up shelling out $4 million for the server cluster, which will be used by the Translational Genomics Research Institute and the International Genomics Consortium. This payment seems a little low - even with the discount - for a top 100 system, but the computer could creep in near the bottom of the list.

IBM likes to keep its massive hardware discounts a secret, especially in the life sciences market. The company has thrown millions at life sciences companies in the form of capital investments and cheap hardware. These deals are used to increase the market share of its DB2 database and life sciences software products among bio tech firms.

Oracle currently holds a vast market share lead in the lucrative life sciences market.

IBM offers significant hardware discounts in a variety of vertical markets, using the hardware sale as a vehicle to cash in on software and services deals. All hardware vendors offer some cuts in this type of economy, but IBM's appears to have some of the most aggressive reductions.

It's not uncommon to donate hardware to a university, but customers are usually encouraged to keep quiet about the extent of the price cuts and told to say nice things about IBM's gear. ASU has crossed a forbidden line and tainted what could have been a pristine, philanthropic gesture.

Do you know of a giveaway that may be taking place in your back yard? Let us know