Research Report

The IBM zEnterprise EC12: A Technology/Strategy Review
Executive Summary When IBM introduces a new generation of its System z mainframe architecture as it has just done with its zEnterprise EC12, the first three questions that mainframe customers, prospects, reporters and research analysts ask are: 1. What has IBM done to improve System z from a technology perspective? 2. What is IBM trying to accomplish strategically? And, 3. How much does it cost? In short, the answers are:  From a technology perspective, IBM has introduced a new z processor that offers up to 25% more computing power than the previous generation z processor thanks to improvements in cache, the processor nest, and thanks to new instructions. o In cache, IBM has expanded Level 2 cache by 33%, and has doubled the cache in Levels 3 and 4 from 24 MB to 48 MB, and from 192MB to 384MB respectively. Cache serves data to the processor — so, with faster processors and more cache IBM is now able to serve more data to the process, thus delivering more compute power; o Instruction set improvements and new facilities enable certain workloads to execute more quickly (for instance, new Java workload performance can increase by 45%; DB2 by 30%; and PL/1 workload performance will also increase significantly as PL/1 exploits the new decimal format conversion facility). Other technology advances include new manageability, availability and security offerings — as well as advances in hybrid computing. o o o The new management improvements include IBM zAware (embedded firmware that provides advanced analytics-based monitoring for Sysplex environments) Enhancements that enable mainframes to manage System x more effectively by improving mainframe Unified Resource Manager (the mainframe hybrid computing management environment) interaction with System x Systems Director; To improve availability, IBM introduced Flash Express (a new tier of solid state disk-based memory that absorbs paging challenges as customers transition from one mode of operations such as batch processing to another mode such as interactive processing); In security IBM has introduced a new version of its cryptography card (the Crypto Express 4S) with new security extensions including PKCS#11 compliance; and, For hybrid environments, IBM has introduced a new zBX enclosure (the zBX Model 003).

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What is IBM trying to do strategically with the new System z? For the past several years the System z strategy has been focused on: 1) making successive generations of System z more efficient at processing new and existing workloads optimally in order to ensure the

The IBM zEnterprise EC12: A Technology/Strategy Review longevity of System z; 2) pushing-the-envelope in reliability, availability, and security (RAS) in order to separate System z from other servers in terms of enterprise-class resiliency; 3) driving efficiency at scale — making System z the only choice for very large enterprise computing jobs; and, 4) positioning System z as a central governance node for management and security within the enterprise. o o o o With the new zEC12, IBM has placed new emphasis on optimizing Java, SAP and business analytics workloads; The company has pushed-the-RAS-envelope with new availability and security products (described earlier). By adding more processing power and more capacity, IBM has continued to drive its efficiency at scale initiative; and, By introducing a new zBX blade enclosure and by adding management extensions to its Unified Resource Manager, IBM is proving its continued commitment to hybrid computing.

From a cost perspective, IBM is reducing $/MIPS (dollars per millions of instruction per second) consistent with reductions of the past — meaning that the cost for processing existing workloads on standard, general purpose z workloads is going down. But even more interesting, IBM is offering a cost reduction of @20% on the $/MIPS on its specialty engines (IFLs, zIIP, and zAAP processors). Maintenance costs are also decreasing from 220%. o This shows that IBM is getting very aggressive when it comes to capturing new workloads on its System z mainframe architecture.

As we look more closely at this announcement, we think the big news is that the zEnterprise EC12 can execute certain workloads significantly faster than ever before (with major improvements in the processing of Java workloads, in the throughput of DB2/operational analytics applications, in the speed of processing compute-intensive C/C++ applications, and with a bigimprovement in the throughput of SAP workloads). We are also intrigued by IBM’s new IBM zAware reporting facility because it offers the potential to expand analytics beyond the management of System z environments to other environments that can make use of pattern analysis and predictive analytics (such as cryptography and fraud detection).

In this Research Report, Clabby Analytics takes a closer look at the new zEnterprise EC12 from technology, strategic, and pricing perspectives. And our key findings are that the zEC12 is significantly faster than previous generations; it has been tuned and optimized to execute certain workloads more efficiently; that System z RAS has been improved — and that IBM has made a serious effort to offer all of these improvements while lowering the $/MIPS costs for its customers. Technological Improvements When we evaluate new generations of System z, we look for hardware improvements (including processor improvements and the introduction of new hardware elements) as well as optimization efforts in the areas of firmware, instruction sets and compilers. A Closer Look at the Hardware Improvements The first thing we look at when evaluating systems is the microprocessor (we look for speed improvements as well as new instruction set inclusions). We then look for advances in memory and in memory management (because the more data that can be placed in memory and cache, the faster that data can be processed). Next, we look for improvements in the System z internal throughput rate (ITR – how much work the system can do at 100% busy). And finally, we look at the input/output (I/O) subsystem to see what IBM has done to improve system I/O bandwidth

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The IBM zEnterprise EC12: A Technology/Strategy Review (measured in GB per second — to see how fast IBM can move data between the system and external devices such as storage subsystems and tightly coupled zBX blade environments). Our key technology findings are:  At the microprocessor level— the speed of the z microprocessor has been increased from 5.2 GHz to 5.5 GHz, and new instructions have been added to streamline execution for certain workloads. What this means is that the zEC12 is the fastest superscalar processor in the industry, enabling it to get more work done than any other processor — while new instructions and facilities streamline the execution of certain workloads. Additionally, the number of processors has increased from 80 up to 101 configurable cores. IBM has added more on-chip cache (described earlier) to speed data serving to these processors. IBM’s cache improvements have doubled the amount of on-chip data that can be fed to the processor — leading to significantly faster transaction and data processing. Memory has remained the same as the predecessor z196 at 3TB of RAIM (redundant array of independent memory). From our perspective, 3TB is a lot of memory capacity — plenty for most of today’s most challenging enterprise computing applications — so we don’t think IBM needed to focus its development efforts on expanding memory in the new generation zEC12. But, we note that with the new zEC12, IBM has continued to focus on memory reliability and availability. o IBM introduced RAIM memory in the last generation System z (the z196) to improve memory reliability. But now, with Flash Express, IBM has added a new tier of memory — a solid state disk-based product that can be used to improve the availability of workloads that cannot tolerate paging spikes or inconsistent performance during a transition period (for instance, when moving from a batch processing to interactive processing state).

To further improve performance, we note that the new z microprocessor offers second generation out-of-order design (a means to keep the microprocessor busy by executing jobs when they become available, even if they are out of order). Further, IBM has added multilevel branch prediction (a means to speed processing using a predictive method). To optimize workload performance, IBM has introduced: o o o o A transactional execution facility that improves parallelism and scalability; A runtime instrumentation facility that helps reduce Java overhead; and, Page frames have been increased to 2GB (enabling faster paging for DB2 buffer pools and Java heaps). The performance benefits of these actions are illustrated in Figure 1 (next page).

IBM has increased page frames to 2GB (page frame size is important because larger frames improve performance in DB2 database buffer pools and speed the execution of Java heaps); optimized IMS performance (IMS is IBM’s information management system database management environment), leading to a 30% performance improvement in processing; and IBM announced that it is planning to release a new PL/1 compiler that should deliver a large performance boost from the PL/1 decimal format conversions utility. As for the internal throughput rate, the maximum System z MIPS rating has changed from 52286 to 78426 — meaning that the zEC12 can now do 50% more work than its predecessor; and,

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The IBM zEnterprise EC12: A Technology/Strategy Review  From a system I/O bandwidth perspective, I/O bandwidth remains the same at 288 GBps — still the fastest internal throughput rate in the industry (this is particularly important for read/writes to attached storage and for internal program-to-program communications).

Figure 1 — Huge Performance Improvements Due to Microprocessor Optimization Efforts

Source: IBM Corporation — August, 2012

Strategic Imperatives From a strategic perspective, we look for system and software improvements that enable the System z to run new workloads or to run existing workloads faster; that extend IBM’s already strong position in RAS; that improve System z efficiency at scale; and that extend IBM’s zEnterprise hybrid computing environment. Our key strategic findings are that IBM:  Remains strongly focused on tuning System z for new workloads. At one point in the history of System z, there was great concern that the future of the mainframe was at risk because it had construed as a “legacy” server primarily dedicated to running batch and transactional environments. Over the past dozen years, IBM has been working to change that image by introducing an open operating environment (Linux) — and by focusing efforts on tuning the mainframe for new applications (in particular Java-based applications, enterprise-class business applications, and more recently business analytics applications). o o IBM’s runtime instrumentation facility reduces Java overhead and helps speed Java program execution. In business analytics, IBM has focused on making it possible to run analytics and on-line transaction processing side-by-side on System z. What this means is that a single system (System z) can share the same data between operational applications and analytics applications — without having to move the data set. This means that data warehouses, analytics, and OLTP can all run as the same workload in a seamless, real time environment instead of on siloed, separate databases.

When it comes to RAS, resiliency and manageability, IBM wants System z to be the industry standard bearer. In the previous section, we described how IBM has improved availability and performance using a new product called Flash Express (a product that is designed to support pageable large pages and ensure that workloads perform paging operations more efficiently). But IBM has also improved its best-in-the-industry, EAL Level 5+ position with PR/SM and also with the availability of a new cryptographic card known as Crypto Express4S. This card improves security with new algorithms and with

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The IBM zEnterprise EC12: A Technology/Strategy Review the addition of new PKCS #11 coprocessor firmware (it helps meet security requirement of the European Union and public sector clients). From a manageability perspective, IBM has improved its System z Sysplex configuration with a “smarter message monitoring” facility known as IBM zAware (described earlier — it automates identifies potential problems to help customers speed up problem determination/resolution).  With faster processing and extensive capacity, IBM is positioning the System z as a private cloud server that offers a high degree of efficiency as well as the ability to scale into very large cloud configurations. The new zEC12 is consistent with this goal. Finally, IBM announced its zEnterprise hybrid systems environment when it announced its z196 environment two years ago. zEnterprise enables a System z to manage and govern attached “zBX” x86- and POWER-based blade environments, leading to all sorts of advantages in workload optimization and balancing (workloads can easily be assigned to the processors/systems best suited to execute them). Along with its announcement of the zEC12, IBM has also announced a new, updated zBX blade chassis environment, signaling that the company plans to continue to aggressively pursue hybrid workload opportunities by improving the management of hybrid zEnterprise/zBX mainframe/blade environment.

Cost/Pricing When looking at System z costs we look at the cost for MIPS (millions of instructions per second — a measure of processing power), software pricing, and maintenance costs.
The big news from a cost perspective is that IBM is lowering its MIPS costs for traditional established applications — and more aggressively for new application environments. What this shows us is that IBM wants to reward its existing customers with lower costs, while incenting customers and prospects to place new workloads on System z.

Our key cost/pricing findings are that:    Existing customers running traditional workloads should expect to see traditional hardware price points decline in a range consistent with the past several years; The introduction of IBM’s Technology Upgrade Pricing will deliver a 2 -7% lower MLC (monthly license charge) software pricing for equivalent capacity; Offers a cost reduction of @20% on the $/MIPS on its specialty engines (IFLs, zIIP, and zAAP processors). (IBM is reducing costs by preserving the 120 PVU [processor value unit] rating to help reduce IFL software costs). This reduction shows that IBM is getting even more aggressive when it comes to capturing new workloads on zEnterprise; Offers a minimum 2% price/performance decrease in maintenance for traditional workload environments running standard MIPS with a greater discount offered with growth upgrades — and a 20% maintenance reduction for customers running IFL (Integrated Facility for Linux — a Linux specialty processor) MIPS; Is continuing to try to attract new customers with cost-reduced, packaged mainframe/application software solutions (known as “Solution Editions”) that offer aggressive pricing and terms for first-in-enterprise customers; and, Is offering a no-fee carry-forward of zManager blade entitlements and zBX upgrades to its zEnterprise customers.

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The IBM zEnterprise EC12: A Technology/Strategy Review What Impresses Us Most: IBM’s Workload Optimization, Management and Business Analytics Improvements To us, it is perfectly clear that IBM is positioning the System z to go after new workloads — particularly Java-based as well as analytics workloads. As proof, notice in Figure 1 the huge improvement in processing Java workloads (a whopping 45% — this is a huge improvement!). Also note the 30% performance improvement for DB2 and z/OS operational analytics.
From our perspective IBM is making a statement: The System z is more than a batch/transaction processor — it is a highly scalable, highly resilient enterprise server capable of executing the most modern Java and database/analytics applications available in today’s marketplace.

Workload Optimization: A System-wide Effort Note, however, that these major improvements in workload optimization are not soley the result of improving processor speed, expanding cache, and building in new instructions and facilities. They are the result of a total systems effort that includes advances in semiconductor manufacture, microprocessor design, systems design, virtualization and operating systems tuning, compiler and Java virtual machine tuning, and middleware optimization (see Figure 2). Figure 2 — From Semiconductor Design to Middleware Optimization: A Total Systems Effort

Source: IBM Corporation — August, 2012

Manageability Advances One area that we constantly track is System z manageability. We are primarily interested in mainframe management from two perspectives:  We want to ensure that the mainframe management environment is constantly made simpler to manage such that a new generation of mainframe managers can easily step-in and manage/tune the mainframes of the future. For more on this concept, please see our report entitled “OMEGAMON V 5.1 Review: Client-driven Redesign of Mainframe

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The IBM zEnterprise EC12: A Technology/Strategy Review Performance and Availability Monitoring” that describes how IBM clients are guiding the design of mainframe management to simplify mainframe management; and,  We believe that one of the biggest advantages that mainframe architecture has over other systems architectures is in the area of manageability. We have noted in other reports that it takes far fewer systems administrators and managers to manage highly-virtualized mainframe environments than it does to manage distributed systems environments. So we constantly track advances in mainframe management in order to show our readers how superior mainframe management is when compared with distributed systems environments.

IBM’s latest manageability announcements included improvements in IBM’s Unified Resource Manager (a management product used to support workload aware resource optimization in hybrid zEnterprise/zBX environments. Further IBM announced enhancements to its System Director x86 management environment that make it easier for System Director to support IBM’s zBX enclosures. But, in addition to these management improvements, IBM also announced a new monitoring product known as IBM zAware. As described earlier, IBM zAware is embedded firmware that provides advanced analytics-based monitoring for mainframe environments. IBM zAware has a set of restful APIs that provide information, in XML format, that can feed other processes or tools. It takes samples every 2 minutes at 10 minute intervals — and it uses a 90 day rolling baseline that it establishes by monitoring system behavior. In this manner, IBM zAware is able to isolate potential problems — and enterprises are able to spot problems before they mushroom. At the zEC12 announcement, IBM provided a statement of direction on IBM zAware: IBM plans to provide new capability within the Tivoli Integrated Service Management family of products designed to leverage analytics information from IBM zAware, and to provide alert and event notification. (Note that because IBM zAware delivers information in XML format, so many other management tools can also take advantage of IBM zAware information).
What we like about IBM zAware is that it simplifies management and streamlines troubleshooting — making it easier for managers and administrators to tune and fix their System z environment without requiring any rules to be written. We think this product, as it matures and becomes more broadly available across the System z line, will go a long way to simplifying the mainframe for next generation managers — as well as lower management costs.

Business Analytics Advances In the past we have written about how IBM’s System z makes an ideal business analytics processing environment (see our report entitled: “Choosing IBM’s z Enterprise for Next Gen Business Analytics Applications” for more details on why System z offers “superior economics” when it comes to business analytics processing). What we are now seeing with the new zEnterprise EC12 is a system that offers more capacity, more processing power, and a systems design that is superior to distributed systems when it comes to analytics processing. A closer look at the System z network/bus/IO subsystem design shows why mainframes communicate more efficiently than distributed systems designs. Distributed systems rely heavily on networks to pass information between servers and to fetch data from databases. And networks can easily become congested — especially during peak workload time. System z, on the other hand, has a huge, high-bandwidth internal bus and a supporting subsystem of specialized input/output processors that enable applications to work efficiently and cooperatively without the network congestion that plagues distributed computing designs. Further, the System z can be tightly-coupled to external storage that supports backend data stores, delivering data at high speeds to the processors performing the work.

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The IBM zEnterprise EC12: A Technology/Strategy Review

This final point regarding back-end data stores is very important. With its increased capacity and processing power, the zEC12 is able to run data warehouse, analytics and OLTP applications using the same data store (instead of relying on multiple, snap-shotted, siloed individual databases). The ability to use the same data store simplifies data management (no need to worry about data duplication, for instance) — and it paves the way for enterprises to develop new insights. (IBM customers are now telling IBM that they are able to develop new insights that they could not have developed when using separate data silos). The ability to use a common data set across data warehouses, analytics, OLTP, and other operational environments is a distinct advantage for the highly-scalable System z.

Summary Observations The new zEnterprise EC12 is a fast, powerful, highly-integrated, well-balance computing environment designed to serve a wide variety of workloads (transactional, batch , interactive, scientific, industry, and analytics applications). What impressed us most from a technology perspective about this new System z is its raw processing power (5.5Ghz) aided by significantly more on-chip cache (to rapidly feed data to the superscalar processor). We are also impressed with all of the work that IBM has done to accelerate the processing of various workloads on System z. The zEC12 has new instructions and facilities that greatly improve Java, PL/1 and C++ applications handling. Capturing new applications on System z is strategically vital for IBM — and given the software performance streamlining that IBM has done on the zEC12, we expect more and more independent software vendors (ISVs) to port their software into the mainframe environment (and we expect that IBM customers with custom applications will build more applications on z). We also liked all of the work that IBM has done in manageability. Simplifying and improving manageability helps pave the way for next generation System z managers and administrators to more easily troubleshoot and tune System z environments. Further, by simplifying management by using advanced analytics, we believe that IBM has poured the foundation for a slew of new management and security products that will serve to greatly lower human-labor-related management costs.
To us, this new zEnterprise (the zEC12) showcases all of the major System z differentiators: powerful processing, advanced RAS, simplified manageability, efficiency at scale — and most importantly: the ability to optimally execute a wide range of workloads across System z and hybrid environments.

Clabby Analytics http://www.clabbyanalytics.com Telephone: 001 (207) 846-6662
© 2012 Clabby Analytics
All rights reserved August, 2012

Clabby Analytics is an independent technology research and analysis organization. Unlike many other research firms, we advocate certain positions — and encourage our readers to find counter opinions —then balance both points-of-view in order to decide on a course of action. Other research and analysis conducted by Clabby Analytics can be found at: www.ClabbyAnalytics.com.

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