Mainframe Pricing: The “Value Unit” Alternative

One of the big challenges that IT executives have faced in the past when attempting to add new workloads to their mainframes has been related to purchase terms. To date, most have had to pay a monthly license charge (MLC) for the products and that they used (in other words, they have had to rent their mainframe products). This has forced these enterprises to account for the use of their mainframes as an operational expense ().

For many enterprises, this OpEX approach works quite well. If they have a good idea of what their usage will be, then mainframe costs can be fairly predictable. But what happens in cases where usage is highly variable – or when a buyer wishes to purchase the products rather than rent? In these cases, the MLC approach is simply too restrictive.

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NOTE: This column was originally published in the Review.

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