IBM Delivers Small and Midsize Businesses a Complete System i Solution for SAP(R) Applications

ARMONK, NY - 12 Oct 2006: IBM (NYSE: IBM) announced today a new, specially priced solution uniquely configured for small and midsize businesses adopting SAP® business management applications. Designed specifically for customers with 100 SAP users or less, the solution is based on IBM's System i business computing platform and delivers a comparable acquisition cost to Windows-based solutions.

The IBM System i 520 Solution Edition for SAP applications provides customers a solution that is similarly priced to comparable configurations on Windows-based systems like Dell PowerEdge. SAP business management applications are known for their tight integration, as is the System i platform -- which has built-in security, virus-resistance, database and storage as well as systems management recognized for its simplicity. This allows small and midsize businesses to run programs across the entire business -- from accounting, supply chain, customer relationship management, email and disaster recovery -- all on one system that automatically backs-up and helps manage the data.

"Small and midsize business customers typically operate in lean environments with little or no IT personnel and limited resources. Some of these customers have previously selected Windows-based environments to support their SAP applications -- believing it was the most economical choice -- then found themselves acting as the systems integrators for their business as they managed multiple servers and added the operating system and storage they needed to make the solution actually run," said Mark Shearer, general manager of IBM System i. "Today's announcement removes price from the equation, giving small and midsize businesses a simpler SAP solution that requires minimal technical expertise."

Customers that have selected System i Solution Editions to run SAP applications on the System i 550, a larger model than the i520, include the following examples and illustrate how the combination of SAP and System i works well for small and midsize businesses:

-- Butterball, LLC, a Mt. Olive, North Carolina-based international food
company, relies on SAP applications running on the System i to help it
process and sell some 17 million turkeys a year. "We chose SAP running on
System i because, as a midsize business, we're big fans of technology that
just runs and doesn't require a lot of security patches or hand holding,"
said Ron Wells, MIS Director of Butterball, LLC. "We were impressed with
the reliability, performance and attractive cost of our SAP, System i
solution."

-- edding AG, the premium brand for markers and writing implements, is
headquartered in Ahrensburg, Germany and relies on SAP and the System i to
help it provide customers with products known for their quality,
reliability and creativity. "By buying an IBM System i Solution Edition,
edding has taken the opportunity to consolidate multiple servers onto one
system, offering significant savings in administration and license costs,"
said Marina Riemann, Head of Competence Center Infrastructure, edding AG.

"SAP applications incorporate best practices for managing industry business processes and allow our small and midsized business customers to focus on the competitive differentiators that give them an edge in the market place," said Steve Cragan, vice president, Alliances & Business Development for Global SME Indirect Channels, SAP. "Together with our partners and the IBM System i 520 Solution Edition for SAP applications, our customers can benefit from great application performance at a low acquisition price and superior total cost of ownership."

The IBM System i 520 Solution Edition for SAP applications is an integrated hardware and software solution sized specifically with the additional disk storage necessary to provide up to 100 SAP users access to this robust application portfolio, which includes mySAP All-in-One, business intelligence, customer relationship management, product lifecycle management and supply chain management.

Today's news builds on a joint initiative SAP and IBM launched in January to help connect SAP and IBM business partners so they can better work together to reach new customers and prospects, particularly in the small and midsized business space. Because the new System i 520 Solution Edition for SAP applications will be sold primarily through the channel, these connections will prove invaluable for partners.

Azure Technologies, an IBM business partner with offices in Singapore and Malaysia, is one participant in the SAP, IBM initiative to connect their respective business partners. "This ecosystem initiative presents strong value and financial benefits by simplifying the route to market for IBM and SAP business partners. It also gives customers a single point of contact to take advantage of the resources of this vast network," said William Chu, deputy managing director, Asean Region, Azure Technologies. "The IBM System i 520 Solution Edition for SAP applications will allow customers to start small and scale as their business grows. The ecosystem initiative will also help speed customer installation of the Solution Edition because the now well-connected business partners have the ability to ensure the solution is best tuned for their businesses."

Pricing and Availability

The IBM System i 520 Solution Edition for SAP applications will be available from IBM and IBM Business Partners later this month, with solution configurations starting at $35,000.

SAP software has been available on IBM System i and its predecessors for over 10 years.

For more information on IBM System i, visit http://www.ibm.com/systemi.

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