IBM Mainframe Niche Market Draws EU Regulatory Probe
News Analysis: When the European Union completes the investigation of IBM's mainframe business, it will likely find that while IBM may dominate the mainframe market, it's still a small portion of today's overall computer industry.When European Union regulators announced an investigation into IBM's business practices in Europe, it was reacting to complaints from two companies that produce mainframe emulators for Intel platforms. The two companies, T3T and Turbo-Hercules, claim that they are being cut out of the market because IBM won't sell its mainframe software to them for use on their software that allows x86 platforms to run IBM mainframe software. IBM faced a similar investigation in the United States in the past, and until 2000 was required by the Justice Department in the United States to decouple hardware and software sales.
The order by the DOJ has expired, and since that time, the last makers of IBM-compatible mainframe computers have gone out of business. However, a number of mainframe makers remain in operation serving their own markets. In this new European investigation, there are actually two actions. The first, regarding the sale of IBM mainframe emulators, was brought about because of the complaint. A second investigation was initiated by the European Commission's Competition Commissioner Joaquin Almunia in regard to its claim that IBM is favoring its own maintenance business over others, and that it is delaying deliveries of parts to third-party maintenance companies as a way to force them out of business. The European Commission is the Executive Branch of the European Union.