IBM Mainframe Niche Market Draws EU Regulatory Probe (
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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.
Right
now the investigation is in the opening, or "Mutual Accusation,"
stage, in which the various players blame each other for whatever happens to be
in question. IBM, for example, is saying it's
all Microsoft's fault. This is a pretty easy thing to do, since, after all,
when you're as big as Microsoft, everything that happens is really your fault.
Assuming
that the EC investigation finds IBM at
fault, it's possible that the company could be forced to pay a fine, just as
Microsoft and Intel have had to do. But the investigation will take years, IBM
will have the right to appeal, and that will take even more years. As you can
tell, nothing is likely to happen anytime soon. Unless IBM
decides that its proprietary approach is a bad idea (and it might), then the
makers of emulators are in for some tough sledding for a while.
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