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|     Report prepared by:    Faulkner Information Services            |
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|     Report submitted on:   August 2, 1993                           |
|______________________________________________________________________|

Chapter 6.  IBM's AS/400 F Series

Section 6.1: Introduction

Section 6.1.1:  Product Line Positioning

The AS/400 is one of the world's most popular midrange systems, with
over 200,000 units installed. Since its introduction in 1988, the
platform has been a great success for IBM. At a time when the future of
the traditional minicomputer was much in question, the AS/400 not only
created a migration path for existing System/3x customers but also
quickly became a solid choice for new customers in a variety of
businesses.
    A May 1993 Computerworld minicomputers survey, in which the AS/400
was compared with the DEC VAX and the HP 3000, revealed the following:
   o  DEC holds the advantage in portability, with three levels of POSIX
      and the support of Version 3.0 of the X Open Portability Guide,
      which the AS/400 does not support.
   o  The AS/400 received a low score from users for standards
      compatibility, even though analysts were impressed by IBM's work
      with POSIX.
   o  Overall, IBM rated 64 points on a scale of 100, versus 75 for DEC
      and 73 for HP.

    In addition to competition from DEC, IBM faces a challenge from
Unisys. Unisys is positioning its low-end mainframe models, the A7 and
A11 series, against the AS/400. The company has announced features that
add a level of interoperability, scalability, and portability, such as:
   o  an implementation of NetWare for UNIX
   o  close coupling with OS/2 and UNIX platforms
   o  portability via the Link and Mapper 4GLs
   o  the ability to run applications without recompilation up and down
      the line

    AS/400 systems support non-technical business users in small to
medium-sized businesses; its many built-in ease of use features reduce
the need for a computer staff. Targeted markets include:
   o  first-time computer sites
   o  sites with existing PCs, which can be linked and supported by the
      AS/400 using Token-Ring
   o  as a follow-on system to System/36 and System/38
   o  sites where work is distributed, departmentally or geographically,
      are targets for AS/400 "multiples"

    AS/400 systems also support general business and vertical market use,
including:
   o  manufacturing, via AS/400 Manufacturing Accounting and Production
      Information Control System (MAPICS) 
   o  distribution services, via AS/400 Distributors Management
      Accounting System (DMAS)
   o  construction, via AS/400 Construction Management and Accounting
      System (CMAS II)
   o  order management
   o  hotel reservation
   o  legal profession
   o  education
   o  accounting and check processing
   o  retail point-of-sale
   o  telephony (via CallPath/400)
   o  artificial intelligence
   o  image processing (via ImagePlus)
   o  fax processing (via Facsimile/400)
   o  office automation
   o  AFP print server functions for a System/370 processor

Section 6.1.2: Product Line Strategies

The F Series is representative of IBM's strategy to market the AS/400 as
a client/server, open systems product. IBM is leveraging current AS/400
features, such as centralized support for security, ease of software
version control, and superior I/O performance, with planned enhancements
such as a RISC-based version, to boost the AS/400's downsizing. IBM will
most likely use a RISC implementation spawned from its PowerPC
development with Apple and Motorola. 
    IBM's software strategy is to modularize software as much as possible
so that when new programs are released, they can be quickly and easily
installed on the server. These strategies are designed to retain current
AS/400 customers even as they downsize their mission-critical
applications.
    Users are attracted to the AS/400 because it is easy to operate for
nontechnical staffs and because it can be integrated into small business
and distributed computing sites with relative ease. Early limitations
with disk and tape storage capacities and with CPU performance have been
addressed, especially with the most recent F Model introductions.
  
Section 6.1.3: Strengths and Weaknesses

    Strengths
    =========
   o  A March, 1993 study examining the most cost-effective platform for
      supporting distributed on-line transaction processing (OLTP)
      applications gave high marks to the AS/400. The AS/400 placed ahead
      of the DEC VAX/VMS platform, the HP 9000 platform, and a Compaq
      ProSignia i486 server-based NetWare LAN. The AS/400 was lauded for
      its strong systems management capabilities.
   o  All models have a single, consistent operating system with an
      integrated relational database.
   o  The AS/400 runs most System/36, System/38, and AS/Entry application
      programs with minimal need to modify source code.
   o  The AS/400 is simple to operate, with built-in menus and on-line
      help for general users and a command-level interface for more
      experienced users.
   o  The AS/400 supports cross-system and enterprise-wide connectivity
      with PC integration that provides common menus for PC and AS/400
      applications, file server, and printer sharing. The AS/400 allows
      for remote IPL of medialess programmable workstations.
   o  The AS/400 offers optional comprehensive office support, including
      high-function text processing, proof-reading assistance, document
      management, directories, distribution lists, calendar, and
      electronic mail.
   o  The DASD Mirroring option improves availability and minimizes
      system downtime due to single disk failure.
   o  The AS/400 provides worldwide national language support.
   o  The AS/400 supports the Customer Information Control System/400
      (CICS/400), a licensed program that supports migration to, and
      development of, CICS applications on the AS/400.
   o  The F Series offers improvements for both of its major AS/400 user
      bases: it offers more prepackaged software for its smaller
      customers, and it offers more applications development and systems
      management packages for its larger users.
   o  The AS/400 offers one of the lowest data processing costs in the
      industry.
   o  The AS/400 is a solid platform, backed by IBM and positioned for
      growth.

    Weaknesses
    ==========
   o  An early 1993 survey of 16,000 AS/400 customers shows that 54
      percent of US firms running AS/400s plan to deploys new
      applications on PC-based LANs, up from 40 percent in late 1991.
      However, many customers are hesitant to move key applications
      completely off the AS/400 because they feel that the ability to
      maintain version control among multiple applications and ensure
      security for remote transactions is critical.
   o  Because of the popularity and pervasiveness of the RISC chip in the
      computer world, many potential AS/400 customers buy RISC
      System/6000s or RISC systems from other vendors. There is a
      possibility that the AS/400 G Series, to be introduced in late 1993
      or early 1994, will implement RISC technology.
   o  According to a March 1993 Communications Week survey of AS/400
      users, weaknesses of the AS/400 include:
        o Built-in query tool is relatively slow
        o Other tools lack user-friendly graphical interfaces
        o Price considered high compared with other servers

Section 6.1.4: Futures

In 1995, IBM plans to add its WorkPlace OS operating system microkernel
into PowerPC-based versions of the AS/400.  This would enable AS/400 to
run programs written for Taligent's object-oriented environment and
other platforms. WorkPlace OS will be built into the PowerPC machines as
an application shell below the OS/400 operating system, rather than as a
base microkernel with OS/400 residing on top of it as a personality.
    In September 1993, IBM intends to announce plans for improving the
file and database server capabilities of the AS/400.  Plans include
making high-end AS/400 CPUs available on lower end models, off-loading
file processing functions from the CPU to I/O processors, and offering a
streamlined kernel version of OS/400.
    In May 1993, IBM demonstrated wireless connectivity between AS/400
servers and third-party mobile data terminals and pagers. Using IBM's
Mobile Network Access software, composed of PagerPac/400 one-way
communications software and RadioPac/400 two-way software, traveling
professionals can tap into an AS/400 server and obtain data such as
product orders or inventories.
    PagerPac/400 allows users to exchange data via private and public
paging services; RadioPac/400 taps private and public data networks such
as Ardis and RAM Mobile Data's Mobitex.
    The AS/400 Mobile Network Access software is a derivative of Business
Partner Solutions' (BPSI) Messenger software, and is due in August 1993.

________________________________________________________________________
|                                                                      |
|     Report prepared by:     Faulkner Information Services            |
|                                                                      |
|    Report submitted on:     August 2, 1993                           |
|______________________________________________________________________|