LAS VEGAS, - 11 Apr 2011: Building on efforts to help its partner community capitalize on the growing cloud computing opportunity, IBM (NYSE: IBM) today is making available two pricing and financing programs to help IBM Business Partners and start-up companies more easily build their own cloud applications and infrastructures with IBM technology.
IBM will provide Cloud Application Providers – businesses that deliver Software as a Service (SaaS) – the option of acquiring IBM software for use in their SaaS offerings as a monthly rental subscription, complementing the way they receive payments from their own clients.
Additionally, IBM will provide financing programs specifically designed for IBM Business Partners that are building cloud computing technical environments. With low-rate to 0% financing and deferred payments on IBM technology and services, the company will offer qualifying partners the opportunity to avoid large up-front costs as they start their cloud businesses.
These two offerings build on IBM’s program to develop the IT industry's broadest ecosystem of companies that provide a wide range of cloud computing services and technologies for clients of all sizes and industries. This recently announced IBM Cloud Computing Specialty supports IBM Business Partners that demonstrate their expertise and customer success in cloud computing.
Companies in industries ranging from healthcare to entertainment are turning to cloud computing as a way to deliver and provide IT in innovative ways. According to analyst firm IDC, $45 billion will be spent on cloud-related technologies, hardware and software by 2013, up from $17 billion in 2009. (1)
“More and more clients are asking IBM and our partners to provide them with cloud capabilities around the globe, ranging from the flexible delivery of software applications to building private and public clouds,” said Jim Corgel, general manager, Independent Software Vendor (ISV) and Developer Relations, IBM. “IBM's business partner community is essential to our ability to support these demands, and we are committed to providing the industry's best resources and opportunities to help our partners grow their business through the cloud.”
Monthly Rental of IBM Software for SaaS Providers
The opportunity for Cloud Application Providers continues to grow as more businesses and organizations across several industries are turning to variably-priced, web-based software for different capabilities – from managing electronic health records to delivering industry-focused CRM and business analytics software.
With the pricing model announced today, these ISVs will be able to offer clients the ability to get new capabilities up and running in a short amount of time without large up-front capital or on-going staffing to maintain the applications and hardware systems.
IBM’s monthly rental software pricing allows ISVs to build and deliver their SaaS applications with IBM software – such as IBM WebSphere Application Server and IBM DB2 – and scale up or down the software licenses needed monthly based on an annual commitment. For example, this allows ISVs servicing retail clients the opportunity to use more software licenses during heavy holiday or “back to school” seasons, and fewer during historically lower shopping months.
“As an ISV providing our own ERP software to various industries, we now have several clients opting for cloud-based delivery of our technology,” said Claudio Bessa, international and new business director for Brazil-based IBM Premier Business Partner, TOTVS. “Through the monthly rental pricing from IBM, we can better manage our monthly finances and have the opportunity to grow or shrink the licenses needed on a monthly basis based on our own deployment patterns.”
For IBM, this provides a new opportunity to migrate ISVs from competitive software platforms to IBM middleware, as well as to offer start-up ISV companies with an easier on-ramp to IBM technology as part of their overall offering.
Jump Start Financing for Cloud Builders and Infrastructure Providers
IBM Business Partners can quickly build and expand their cloud business with low-rate financing programs available from IBM Global Financing, the lending and leasing arm of IBM. IBM Global Financing helps credit qualified Cloud Builder and Cloud Infrastructure Providers reduce up-front costs, predict monthly payments and optimize their cash flow as they enter new business models.
IBM Global Financing offers a range of financing alternatives to fit each Cloud Builder and Infrastructure Provider’s specific needs, enabling faster build-out of a cloud infrastructure, while keeping technology current and competitive with a well-defined IT lifecycle strategy. These include:
· Cloud partners can optimize cash flow and ROI with low-rate and 0% financing offers* that provide predictable monthly payments on eligible IBM hardware, software and services solutions. There are also lease options for select hardware that allow for mid-lease upgrades to the latest processor technology and peripherals, protecting the Business Partner's investment and competitive position while minimizing costs.
· For large infrastructure deployments**, IBM Global Financing offers initial payment deferrals of up to six months, allowing IBM Business Partners to avoid large up-front cash outlays, while growing revenue, and accelerate the cash flow break-even point of their cloud infrastructure investment.
For more information on the IBM software monthly rental model for ISVs, please visit: www.ibm.com/cloud/partner/pricing
For more information on IBM Global Financing, please visit: www.ibm.com/financing
For more information on IBM Business Partner cloud computing initiatives, please visit www.ibm.com/partner/cloud
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1 (1) IDC's Worldwide Collaborative Applications 2010–2014 Forecast Update: Market Poised for Slight Rebound Within Next Five Years (#224269, August 2010).
2 *Depending on solution for deals up to $500,000 in the U.S. and $300,000 outside the U.S. IBM hardware financed through FMV leases; all other items financed by means of loans. Charges for software and services must be one-time, non-recurring. Dependent on country availability, offers include 0% for 36 month FMV leasing on select IBM hardware and 12 month loans for IBM software
3 **Depending on solution for deals greater than $500,000 in the U.S. and over $300,000 outside the U.S. IBM Global Financing offerings are provided through IBM Credit LLC in the U.S and other IBM subsidiaries and divisions worldwide to qualified commercial and government clients. Rates and availability are based on a client’s credit rating, financing terms, offering type, equipment type and options, and may vary by country. Some offerings are not available in certain countries. Other restrictions may apply. Rates and offerings are subject to change, extension or withdrawal without notice.