Neon Enterprise Software, already suing IBM in the United States over its dominance in the mainframe market, says it will file a similar complaint in Europe accusing IBM of anti-competitive practices. IBM, which is suing Neon in the United States, claims that Neon's zPrime software violates IBM's intellectual property.
Neon Enterprise Software, which already is in a legal dispute with IBM
over the tech giant's business practices surrounding its mainframe business,
will now file a complaint with European regulators.
In a brief statement released June 24, Neon officials said the
company will file the complaint with the European Commission-the antitrust arm
of the European Union-alleging "ongoing anti-competitive and abusive
conduct" by IBM to do with its Series z
The complaint would add to the growing list of allegations
leveled by companies such as Neon that offer products they say will help IBM
mainframe users save millions of dollars.
IBM officials have strongly
defended the company's business practices, saying companies like Neon,
TurboHercules and T3 Technologies are trying to make money by violating IBM's
intellectual property and by trying to induce System z customers to violate
their licenses with IBM.
Neon's EC complaint won't be the first filed against IBM
over these issues. TurboHercules, which sells an open-source mainframe emulator
that enables businesses to run mainframe applications on less expensive
non-mainframe systems, filed
a complaint with the EC
in March alleging that IBM
is unfairly tying its mainframe OS, the z/OS, to its System z machines,
The 10-year-old French company has between 5,000 and 10,000
users, according to TurboHercules officials.
For its part, Neon filed a lawsuit in December accusing IBM
of bullying customers into staying away from Neon's zPrime software, which it
said is damaging its business. The suit also said IBM,
which stands to lose millions because of Neon's product, has made false
statements to customers, telling them that using zPrime violates their
licensing contracts with IBM.
Neon's zPrime software lets IBM
mainframe customers move workloads around in such a way as to enable them to
avoid paying licensing fees to IBM, which
Neon officials say can save those customers millions of dollars a year.
Essentially, the software lets customers move more of their mainframe workloads
from expensive central processors to less expensive IBM
zAAP and zIIP specialty processors.
Customers pay software licensing fees to run applications on
the central processors, but not on the specialty engines. Those specialty
processors were created to move some workloads-such as Linux and Java tasks-off
of the central processor and enable the mainframes to take on more modern
T3 Technologies, a one-time partner of IBM,
offers non-mainframe systems that can run mainframe applications. It also has filed
a complaint against IBM in Europe.
filed a countersuit
against Neon in January.
"This case is about Neon's attempted hijacking of IBM's
intellectual property," IBM said in the
complaint. "Neon's business model expressly depends upon Neon inducing IBM's
customers to violate their agreements with IBM.
In this respect, it is no different than that of a crafty technician who
promises, for a fee, to rig your cable box so you can watch premium TV channels
without paying the cable company. Even if it could be accomplished technically,
it is neither lawful nor ethical."
Neon officials have contended that nothing in IBM's
licensing contracts says customers can't move more workloads onto the specialty
processors, and that IBM statements to the
contrary are false and misleading. Neon claims that zPrime can save customers
as much as 20 percent on their annual mainframe costs.
Competitors reportedly are not the only organizations interested
in IBM's mainframe business practices. The
U.S. Department of Justice in October began a preliminary
into IBM's mainframe