Greg Haggerty doesn't have good news for those hoping for a burst of System i-related IT spending in 2007. The expenditures he has a hand in will be flat. It's a similar story elsewhere, with little change foreseen in buying patterns or levels. However, some analysts hold out hope for greater activity after a platform refresh.

Haggerty is the applications development director for The Evangelical Lutheran Good Samaritan Society, the largest not-for-profit long-term heath care provider in the U.S. Among other things, the society's national campus in Sioux Falls, South Dakota provides IT support services to locations in 24 states.

When it comes to purchases of new hardware or software for the society's System i servers, Haggerty says this year will be like the last. "Our normal spending is on more disks, and we have budgeted for about another 500 gig in 2007."

That spending is driven by financial applications that need more storage. There are no plans for any other System i hardware or software purchases.

On the other side of the world, private health care provider Medi-Clinic of Stellenbosch, South Africa, uses 34 System i boxes at hospitals throughout the country. Applications developed in-house cover patient administration, pharmacy stock control, and business-to-business functions. Information technologist Gerrit van Breda says Medi-Clinic's IT expenditures related to System i will also be a repeat. "We will spend about the same on the iSeries as last year, but the spending is mostly on expanding disk capacity," he notes.

Changes are planned, with alternative hospital information systems currently being investigated. However, the new hardware and software hasn't been chosen yet, and so van Breda says the current setup and applications will be around for at least another five years. During that time, any spending will be only for maintaining the existing infrastructure.

At Athens-based Baxter Greece, a part of the multinational health care company Baxter International, Inc., of Deerfield, Illinois, IT supervisor George Glinos says there's a possibility for upgrades and changes — but not this year. "For the current year, we will continue using our system as is," he says.

The local Athens infrastructure is driven centrally by the company's U.S. headquarters. Thus, what happens with regard to IT is a reflection of local conditions and the company's global assessment of the need for changes and upgrades.

The discovery in an unscientific sampling that many System i users intend to largely stand pat doesn't surprise Clay Ryder, president of the analyst firm The Sageza Group, Inc [2]. He notes that the fact that System i sales have been flat or declining during the last few quarters indicates that the customer base is stagnant and that existing customers aren't replacing older installations.

That's partly a result of the steady performance of the platform, which is a good thing. It's also partly because the user base is happy with the installed hardware and software, which likewise is a good thing. Unfortunately, together these two positives make for a negative, putting a clamp on sales. The only way an uptick can happen is if new applications drive workloads up, but the data doesn't point to that occurring.

A factor that may be contributing to the lack of new uses and stagnant sales is that many System i purchases are made around an application. Customers don't buy the product as a general computing platform. A consequence is that the servers don't attract new tasks.

Ryder notes that upgrades to existing installations might include the addition of memory, but he doesn't find that very probable. Disk capacity, on the other hand, is most likely an area in which users would upgrade. "Storage would be a logical one because the more they run, the more data they would consume and create," he says.

Charles King, a principal analyst with research firm Pund-IT, Inc. [3], says that virtually every company is adding storage at a rapid pace, and in that regard the plans of System i sites are just part of the overall trend. He points out that historically the purchase of System i solutions runs in cycles. Sales peak after new updates become available and then settle back in the following quarters.

That's what happened with the introduction of Power5 and 5+ platforms, and King foresees something similar occuring in the future. "I expect to see another surge when Power6 processors become available," he says. "The challenge for IBM is to expand the demand for System i in industries and customers beyond the platform's traditional markets."