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Name change is just a gimmick without strategic re-branding

After months of rumors about a name change for the AS/400, several high-level IBM sources have confirmed to that by early October, the midrange system will in fact have a new name and hopefully, a new identity. IBM's other server lines, the S/390, RS/6000 and the Netfinity, will also tout new monikers, all part of a complex re-branding strategy that analysts say Big Blue is banking on to boost its server revenue, which has remained flat for several quarters.

As first reported by, Insider Weekly (subscription required), the AS/400 would become the iSeries 400, though no new technology will come of it. Other servers would get similar "Series" names, such as the zSeries 900 for the S/390, and all will be identified as part of the "eserver" family of products.

No one knows how the name change will play out, but undoubtedly, say analysts, Big Blue is going to have to wisely market and offer incentives to customers in order to make re-branding work. If it fails to do so, the name change will have been nothing more than a marketing gimmick.

According to Tom Bittman, an analyst with the Gartner Group, Stamford, Conn., re-branding can help IBM unify its line of servers, but only if it strongly positions each system to a particular segment," he said.

Out of all the servers, the AS/400 probably has the highest brand recognition, which Bittman thinks will be lost during re-branding. "However, that isn't all bad since some people hear AS/400 and think 'old, proprietary system,'" he said.

In the late '80s, the Application System 400 was so named because IBM wanted to highlight the wealth of applications available for the platform. Now, IBM is marketing its servers as the machines for e-business (a term IBM is credited with popularizing). As a result, the old name no longer represents the new image IBM is trying to create for the servers.

Strategically, however analysts say rather than looking for a way to group all the servers into one e-business solution, IBM should be looking to sharpen the distinctions between server lines which historically has not been very clear. This fuzziness has meant that server lines sometimes compete with each other. The AS/400 and the RS/6000 are classic examples.

"IBM needs to decide what each machine will be geared towards," Bittman said. "The RS/6000, for example, could be earmarked for data warehousing. More data warehousing development money should then be concentrated in that platform instead of being sprinkled throughout the server line. Backing away like this would be difficult for IBM," he said noting its current line of thinking.

Bittman is quick to add that technologies such as data warehousing or Web serving should not be exclusive to one platform. Chips and software could be shared among platforms. Yet each platform should have its own distinguishing features.

Tim Kuhns was on an advisory council for IBM during the 1980s when the midrange system was named the AS/400. At that time, the exciting thing about the machine was the 8,000 or so readily available applications for the system, said Kuhns, an AS/400 administrator for Ascend Technologies, an Iowa-based company that makes software for the AS/400 to help non-profits with fundraising.

However, Kuhns says he sees NT-based solutions going head to head with his AS/400 applications. He is uncertain about the future of the platform. "We have 26 employees and over a million lines of code. Migrating that (to another platform) is no short order."

A major component of re-branding, then, would be reassuring users that IBM will support the platform they have so heavily invested in. "There really wouldn't be any new technology there, just a new message," Bittman said.

Re-branding will take perhaps a year of steady advertising, rather than short high-energy bursts. In addition, IBM should offer migration or financial programs to help move servers. "They could offer a program to help AS/400 migrate to a large Netfinity or a RS/6000. This migration path would have to be cheaper than Dell or Compaq."

The millions of dollars it will take to do this would likely come from each server line's budget, Bittman said. While this will take away from development dollars, if marketed correctly, it can be very effective and worth the sacrifice.

Let us know what you think about the story, e-mail Ed Hurley, assistant news editor

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