The Value of Linux on z Systems International

The Value of Linux on z Systems® © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems What Is So Special About Linux? § Supports multiple hardware platforms § Is flexible, reliable, stable, and secure § Has an affinity with EXTREME virtualization § Evolves rapidly to meet business challenges § Is developed by a highly skilled, open source community § Runs on multiple platforms § Offers free source code § Offers a large selection of applications, middleware, and tooling from IBM, ISVs, and the open source community § Is available from multiple distributors § Requires no vendor lock-in § Offers widely available, highly-skilled, administrators and developers 2 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Why Do Customers Prefer Linux on z Systems? Linux ® on z Systems TM is a “better place” to go! § Reduced TCO – Environmental savings – Consolidation savings § Improved service level – Single point of control for systems management – Unparalleled reliability, availability, and security § Faster speed to market – Capacity-on-demand capability – Dynamic allocation of online users § Robust disaster recovery – Can be included in GDPS® business continuity capabilities – Leverages IBM remote disk mirroring capabilities § World-class security – Leverages significant z Systems hardware and software capabilities for security and encryption 3 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Is the Same Linux That Runs on Distributed Platforms Linux is Linux 4 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Why Are Businesses Adopting Linux? § Linux offers UNIX ®-based businesses the flexibility to choose lower-cost hardware. § Linux offers businesses that use Microsoft® Windows®-based servers increased flexibility and enhanced security and reliability. § Linux offers all businesses a choice for new workloads through open computing, avoiding lock-in to proprietary hardware or software vendors or architectures. § Linux on z Systems reduces the number of servers required to run the business and places applications and data on the mainframe, lowering TCO. § Linux on z Systems enables customers to run open source software on a scalable platform. § Linux on z Systems provides extreme virtualization. 5 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Did You Know? § Linux on the mainframe celebrated its 15 th anniversary on May 17, 2015. § 27. 3% of total installed MIPS run Linux as of 1 Q 2015. 1 § Installed IFL MIPS increased 13% from 1 Q 2014 to 1 Q 2015. 1 § 39% of z Systems customers have IFLs installed as of 1 Q 2015. 1 § 80 of the top 100 2 z Systems customers are running Linux on the mainframe as of 1 Q 2015. 1, 2 § 68% of new FIE/FIC z Systems accounts run Linux. 1 § 35% of all z Systems servers have IFLs. 1 § More than 3, 000 applications are available for Linux on z Systems. 1 Based on YE 2003 to YE 2014; 6 2 Top 100 is based on total installed MIPS © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems What Is Workload Consolidation? § Consolidation means moving workloads from multiple distributed server environments to a single physical server. § The physical server can be partitioned. Partitioning divides the physical system resources into a number of distinct, isolated regions that operate independently from each other. § Once the physical server is partitioned, the logical server can run an operating system and applications independently, creating the equivalent of a “server within a server. " All the physical pieces behave and perform exactly as they would if partitioning were not present. § Consolidation provides the following benefits: – Simplifies and optimizes existing end-to-end infrastructures – Reduces costs while providing a common, stable foundation for growth and new solution deployment – Reduces the number of server boxes as well as the amount of networking infrastructure needed to connect servers § Linux for IBM z Systems is designed to provide an open, flexible, highly secure, robust, adaptable, and reliable consolidation platform for integrating components of the existing IT environment. 7 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Why Consolidate Workloads? § The x 86 servers generally host one application with one operating system. § Companies may have hundreds of servers running different applications. § Distributed environments are expensive! – Power to run – Power to cool – Real estate § Each server hosts one application and one operating system. – Run at low utilization rates 8 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems The Importance of Consolidation § Companies and IT organizations are under pressure to cut costs, and cost savings is a top benefit of server consolidation through virtualization, followed by availability and flexibility. § Server consolidation is not just about reducing the number of servers: – Simplifies and optimizes existing IT infrastructure – Integrates existing architectures across applications and data § The preferred approach is an architecture-independent approach to server consolidation that encompasses the following four areas: – Centralization to reduce the number of IT data centers – Physical consolidation of software or hardware – Data consolidation, which requires storage – Application creation to consolidate multiple architectures into a single resource space 9 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Why Consolidate on Linux on z Systems? Businesses today use IBM z Systems because the mainframes provide the following benefits: § Vertical scaling allows customers to turn on additional unused CPUs to increase capacity with no downtime (Capacity on Demand). § Servers can run multiple applications so that fewer servers are needed. § Software fees are needed on fewer servers, saving money. § Integrated system management and security mean fewer IT personnel are needed to manage the servers. § Customers can run native hardware on the Linux platform. § z Systems uses less power than distributed x 86 servers supporting the same workload. 10 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Typical Applications for Workload Consolidation § IBM z Systems customers primarily use workload consolidation for: – Cloud deployments – Web serving and Web application serving – Data serving – Systems development § Most of the database work is movement from Oracle and HP customers moving their Oracle database to z Systems because of the savings driven by the efficiency of z Systems and the superior qualities of service (Qo. S) of the platform. § z Systems is the best platform to run mission-critical or revenue-critical applications that require high availability. § Applications that require high I/O bandwidth capabilities benefit from the mainframe because z Systems enables data to flow as databases processing large amounts of data. § Consolidation is the first step in moving to a private or hybrid cloud. 11 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Virtualization with Linux on z Systems § z Systems is architected to host applications in a virtualized environment with exceptional ease and cost efficiencies. § z Systems hardware, firmware, hypervisors, and operating systems enable organizations to maximize the utilization, scalability, and security of all system assets, including: – CPU – Memory – I/O – Networking – Cryptography § z Systems also can provide these benefits: – Cost savings – Resource sharing with Linux on z/VM® – Resource overcommitment with Linux on z/VM – Flexible, efficient growth – Ease of adding newly acquired physical processors to the z/VM logical partition 12 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Hypervisor § A hypervisor is a software or firmware program that runs directly on the server. It separates the operating system (OS) and applications from their physical resources on the server. § The hypervisor is a layer between the server and the OS. Bare-metal Hypervisor Apps . . . Apps OS OS § A hypervisor provides fine-grained time-sharing of all resources. Hypervisor § Bare-metal hypervisors offer high efficiency and availability. SMP Server § z Systems uses the z/VM virtualization software. The z/VM hypervisor is called Control Program (CP). § z/VM can run thousands of Linux servers on a single mainframe running with other System z operating systems, such as z/OS®, or as a large-scale Linux-only enterprise server solution. § z/VM V 5. 4 can also host non-Linux workloads such as z/OS, z/VSE™, and z/TPF. 13 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Scaling Up and Out § Linux and z/VM running z Systems provide the ability to scale up as well as scale out. § To add capacity to a distributed environment, scale out by adding more servers to the grid. – More power and cooling – More administrative overhead – Higher TCO § Scaling up means adding workloads to existing processors. – Same power and cooling – Same administrative overhead – Lower TCO – Higher ROI § System z has additional CPU capacity that can be turned on and off as business needs arise - use what you need, when you need it. § Distributed x 86 systems require users to purchase additional servers. Formatting and setting these servers can take weeks or months. § With z Systems, organizations have even more options to consolidate and integrate their IT environments. 14 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems How Scaling Solves Problems § During spikes in demand, z/VM can redistribute system resources quickly. § Scaling up or scaling out can make the difference between flawless execution and the cost of slow response times or system crashes. § For example, a single z Systems mainframe can scale up to millions of transactions per day or scale out to manage tens to hundreds of virtual servers. It can also dynamically redistribute system resources to manage varying server demands on the systems resources. 15 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Scaling on Linux on z Systems Allows Flexible and Efficient Growth § Start small with Linux on z Systems and nondisruptively add CPUs to your environment as business dictates. – Extra CPUs are already configured with memory and I/O adapters. – Turn them on when you need them. – There is no need to shut down the system to configure the CPU. § Use z/VM to add virtual servers. § Share CPUs and I/O adapters across all z/VM LPARs. 16 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Scaling – z Systems versus Distributed § An x 86 typically has four or eight cores within the server. Each core can generally host two to four virtual machines. If there are 8 cores, the server can comfortably run 16 virtual machines. – Need more capacity? Add another server. • Each server needs a copy of VMware to manage the server. • Servers cannot share CPU, memory, or I/O adapters. § A z Systems IFL can comfortably run 30 virtual machines. If there are 8 IFLs, the server can comfortably run 240 virtual machines. – Need more capacity? – Turn on another CPU that is already in the same box. – All servers in the box can share CPU, memory, and I/O adapters. – z/VM manages all CPUs in the box. 17 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Resource Overcommitment § If the number of virtual processors is greater than the number of physical processors on an LPAR, the z/VM system is overcommitted in CPU. – For example, assume that each guest in a z/VM environment is defined with one virtual CPU. Also, assume that the z/VM LPAR has eight physical CPUs defined to it. The system will be CPU-overcommitted when nine guests are brought up. § Overcommitment allows users to host an environment that consumes considerably more virtual CPU and memory, in aggregate, than what is physically configured in the z/VM LPAR. § Consider 40 Linux virtual machines running in a single z/VM LPAR on two real CPUs: – Each virtual machine is configured with 1 virtual CPU for a total of 40. – That means 40 virtual CPUs are being dispatched on 2 real CPUs, so that is a 20 -to-1 overcommitment of CPU capacity. 18 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Extreme Resource Sharing § z Systems virtual machines can share all hardware assets, including CPU, memory, and I/O adapters with very high levels of resource utilization. § z/VM and Linux enhance this sharing by improving memory utilization and virtual networking bandwidth. § Resource sharing allows z Systems to drive CPU utilization above 90%. z Systems can run at 100% utilization without losing interrupts. And, more hardware assets can be dynamically added to a server running Linux on z/VM LPAR without disruption. § Multiple copies of z/VM can run on a single mainframe, all sharing the same pool of CPUs. 19 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Total Cost of Ownership (TCO) Value Proposition with Linux on z Systems, when compared to Linux running in a distributed system environment, provides the following opportunities for cost savings: § Increased energy and floor space savings § Reduced software license fees through CPU overcommitment § Enhanced staff productivity with large-scale virtual server deployment and management using z/VM § Reduced application outages § Increased flexibility in configuration options for business continuity and disaster recovery § Lower-cost economic model for technology refreshes § Ability to create a common system image that is tested and can be readily deployed 20 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems IBM Solutions Available for Linux on z Systems IBM solutions by brand § Cloud § Analytics § Mobile IBM solution area offerings § Storage solution § Application development solutions § Oracle solutions § Infrastructure simplification solutions § Social § Security 21 Hardware solutions § IBM Linux. ONE – Emperor – Rockhopper © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems IBM Cloud Manager with Open. Stack on Linux on z Systems Offers rapid time to value with built-in Chef patterns IBM Cloud Manager with Open. Stack is an easy to deploy, simple to use cloud management software offering based on Open. Stack with open cloud APIs. Importantly, we include IBM enhancements that feature a self-service portal for workload provisioning, virtual image management, and monitoring. It's an innovative, costeffective approach that also includes automation, metering, and security. Supports Heterogeneous Compute, Storage & Network • Central management across multiple hypervisors and domains • All IBM server architectures and major hypervisors supported Additional Features for Increased Efficiency • Dashboards show Cloud admin resource capacity, VM utilization • Reporting/Metering/Billing, Resource expiration and project approval policies, network configuration and mapping Multi-Cloud Federation Clouds • Federation of multiple Open. Stack instances 22 Accelerate Time to Market: Improvement for new applications Integrated Management: Approvals, metering, billing, users, and projects through a single “pane of glass” Flexible, modular design: Based upon Open. Stack Iaa. S – Access to Open. Stack APIs. Extensible via REST API, allowing partners to easily customize the UI © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Move Analytics Applications to the Data with Linux on z Systems to Cut Costs, Reduce Latency, and Improve Security Approximately 80% of the data that feeds analytics solutions originates on the z Systems platform. 23 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems IBM Mobile. First TM Platform Server, Running on Linux on z Systems, Provides Centralized Connectivity to z/OS Applications Mobile protocol connectivity with core z Systems applications including: CICS®, IMSTM, TPF®, MQ, WAS and DB 2® Optimized integration from: • Fast, powerful IFL engines • Reduced latency, faster throughput • Design scalability of the platform • Inherent high availability, security, and reliability of the mainframe 24 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Security for Linux z Systems The open-source nature of the Linux operating system already provides a favorable security profile, but running Linux on z Systems provides advantages that leverage the server-based security features. § Running Linux in an integrated environment with the z/VM virtualization technology and the z/OS or z/VSE operating systems on the same z Systems server offers additional security and administrative functions that can make Linux operating system more secure and easier to administer. § A full range of security features and applications are available from IBM, open source and software vendors to support a complete and cost-effective security infrastructure for the enterprise grade Linux on z environment. From the IBM Redbooks® series, Security for Linux on System z to your PC, tablet, or phone. 25 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Infrastructure Simplification: IBM Infrastructure Suite for z/VM and Linux on z Systems Organizations that have expanded their business using virtualization technology with Linux on z Systems now have one solution that provides them with multiple tools to monitor, operate, automate, and backup and recover their entire z/VM and Linux on z Systems environment. Product components include: § OMEGAMON XE on z/VM and Linux § Operations Manager for z/VM § IBM Wave § Backup and Restore Manager for z/VM § IBM Tivoli® Storage Manager Extended Edition Benefits include: § Easy-to-use, content-rich interface that is simple and free of operational complexity § Improved productivity with rapid cloning and provisioning of Linux guests on IBM z/VM § Simplified administration with flexible reporting § Easier administration with detailed performance monitoring, including customized views and historical data 26 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Infrastructure Simplification IBM WAVE – Web Administration Environment IBM-WAVE provides the graphical interface that simplifies and helps to automate the management of z/VM and Linux on z Systems virtual servers. § Monitors and manages virtual servers and resources from a single graphical interface § Simplifies and automates tasks § Provisions virtual resources (Guests, Network, Storage) § Supports advanced z/VM capabilities such as Single System Image and Live Guest Relocation § Allows delegation of administrative capabilities to the appropriate teams A simple, intuitive graphical tool providing management, provisioning, and automation for a z/VM environment, supporting Linux virtual servers 27 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems IBM Linux. ONE Linux your way With Linux. ONE, you can pick your distributions, runtimes, hypervisors, management structures, databases, and their approach to analytics. It’s the Linux you know and love with the openness, the flexibility and agility that can empower your business. Linux without limits Linux. ONE enables your business to differentiate itself in a world of standards with lightning fast response times, virtually unlimited scale, giving apps the premium Linux experience they deserve. Linux without risk Linux. ONE ensures that data and services are fully protected and available when and where you need them with the industry’s most secure and resilient Linux system. 28 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems IBM Linux. ONE family of solutions Create an agile and trusted cloud infrastructure to meet new business demands with greater efficiency and lower costs for IT service delivery Build the premier mobile solution for your business to deliver the best possible experience for your clients, employees, and partners 29 Realize quicker time to value, and higher customer satisfaction, through iterative development and continuous improvement Extract insights from your data faster and scale effortlessly to meet big data and analytics demands IBM Linux. ONE Emperor The ultimate flexibility, scalability, performance and trust for business critical Linux applications. With a huge capacity range you can grow with virtually limitless scale to handle the most demanding workloads. IBM Linux. ONE Rockhopper An entry point into the Linux. ONE Systems family offering all the same great capabilities, innovation and value of Linux. ONE with the flexibility of a smaller package. © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Customer Success Stories 30 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Sparda-Datenverarbeitung e. G Offers excellent availability by providing automated failover within seconds Reduces total cost of ownership by about 50%, cuts administration effort and enables a team of three to manage 120 servers Accelerates deployment of new systems Solution components Hardware • IBM® z. Enterprise® EC 12 Software • IBM z/OS® • IBM z/VM® • DB 2® for Linux® • Web. Sphere® Application Server • Tivoli® Storage Manager • Tivoli System Automation for Multiplatforms • Tivoli System Automation for z/OS • Oracle Database • SUSE Linux Enterprise Server for z Systems 31 Leveraging a world-class enterprise computing system to ensure 24 x 7 customer service Sparda-Datenverarbeitung e. G (SDV) is the IT service provider for the Sparda-Bank Group in Germany. SDV develops secure and innovative IT solutions for retail banking, payment, distribution, and financing to improve the products and services of Sparda-Bank Group. The group’s 12 banks employ over 7, 300 people and operate more than 400 branches, serving 3. 5 million customers and a total of 23 million accounts. "The great thing about IBM Geographically Dispersed Parallel Sysplex in combination with SUSE Linux Enterprise Server for System z and all Linux workloads including Oracle Database software is that it just works reliably. " —Oliver Röthinger, System Programmer and Administrator z/VM and Linux on System z, Sparda-Datenverarbeitung e. G © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems VISSENSA Cornering the MSP market with full spectrum hybrid cloud services that meet any client need Maximizing performance for diverse client environments, at an attractive price Matching the right workload to the right platform Boosting client value and Vissensa’s competitive edge Solution components Hardware • IBM® Enterprise Cloud System • Additional IBM servers Software • IBM z/VM® • IBM Wave for z/VM • Linux® for z Systems TM • IBM Backup and Restore Manager for z/VM • IBM Cloud Orchestrator • IBM Operations Manager for z/VM • IBM Tivoli® OMEGAMON® XE on z/VM and Linux • IBM Tivoli Storage Manager 32 Vissensa seized first-mover advantage to launch a full spectrum of Iaa. S, Paa. S, and Saa. S offerings, supported by a hybrid cloud model based on IBM hardware, software, and Soft. Layer® solutions. "Smaller enterprises often choose public cloud services, but encounter issues with cost and complexity when they expand. With solutions from IBM such as the Enterprise Cloud System – which can accommodate more than 6, 000 VMs – we can offer clients the cost-effective scalability they need to take their business to the next level. ” —Steve Groom, CEO of Vissensa © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems ABK-Systeme Gmb. H Bringing innovative mobile applications to the financial services industry Capitalizing on the mobile opportunity Finding ways to move quickly and securely Maximizing productivity of the development process Ensuring rock-solid security Solution components Hardware • IBM® z. Enterprise® BC 12 Software • DB 2® for Linux, UNIX, and Windows • IBM Mobile. First® Platform Foundation • IBM Web. Sphere® Application Server • SUSE Linux Enterprise Server 33 To create an efficient environment for mobile application development, ABK-Systeme deployed IBM Mobile. First Platform Foundation, on SUSE Linux Enterprise Server, running on its existing IBM z. Enterprise BC 12 server. "The combination of IBM (Mobile. First Platform Foundation), System z, Web. Sphere Application Server and DB 2 software has provided the ideal platform for our move into the mobile applications space. The solution has made deploying cross-platform applications much easier, giving us a head start against the competition in bringing secure, reliable mobile applications to our customers. " —Ulrich Buch, CTO, ABK-Systeme © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems European Railway Operator Boosting rail ticket sales to better compete against low-cost travel providers Sleek, modern customer interfaces offer a wider range of travel options Strengthening profitability Boosted ticket sales by a double-digit percentage Revenue win back from competitors The payment transactions are pushed to IBM Web. Sphere Application Server on Linux for System z, which handles all the necessary security checks and brokers the transactions with external payment processor companies. The company has built a robust IT landscape to support top performance and round-the-clock availability for its ticketing application. At the core of the solution, the company stores its business-critical information, including ticket sales data, on IBM DB 2 databases on the z. EC 12 server. "Real-time price, offer and journey updates from the mainframe are key to beating rivals. ” —Spokesperson, European railway operator 34 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Dundee City Council City government discovers the outstanding reliability of Linux on z Systems Proven 24/7 availability over 10 -year period, ensuring citizens can always access services 10 -fold workload increase managed by the same number of employees, improving efficiency Lowers energy costs enabling lower environmental impact and better use of public funding Solution components Hardware • IBM® z. Enterprise® BC 12 Software • IBM z/VM® • Oracle Database 10 g • Enterprise Linux Server Services • IBM Global Technology Services® 35 The transformation: Dundee City Council knew there had to be a simpler, more efficient way to guarantee 24/7 availability for the Oracle Database environment supporting its critical services than its unreliable distributed server-based approach. Embracing a mainframe strategy proved to be the answer, delivering infrastructure simplification and exceptional reliability at low-cost. "You can sum up moving to System z in one sentence: it’s easy and cost-effective, so go ahead. " —Tim Simpson, IT Infrastructure Manager, Dundee City Council © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Questions? 36 © International Business Corporation 2015. All rights reserved.

The Value of Linux on z Systems Trademarks IBM, the IBM logo, and ibm. com are trademarks or registered trademarks of International Business Machines Corporation in the United States, other countries, or both. If these and other IBM trademarked terms are marked on their first occurrence in this information with a trademark symbol (® or ™), these symbols indicate U. S. registered or common law trademarks owned by IBM at the time this information was published. Such trademarks may also be registered or common law trademarks in other countries. A current list of IBM trademarks is available on the Web at "Copyright and trademark information" at http: //www. ibm. com/legal/copytrade. shtml. Intel is a trademark of Intel Corporation or its subsidiaries in the United States and other countries. Java and all Java-based trademarks and logos are trademarks of Oracle and/or its affiliates. Linux is a registered trademark of Linus Torvalds in the United States, other countries, or both. Soft. Layer is a registered trademark of Soft. Layer, Inc. , and IBM Company. Microsoft and Windows are trademarks of Microsoft Corporation in the United States, other countries, or both. UNIX is a registered trademark of The Open Group in the United States and other countries. Other product and service names might be trademarks of IBM or other companies. 37 © International Business Corporation 2015. All rights reserved.