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IBM financial package clinches Lego upgrade

An attractive financial package was the deciding factor in toy maker Lego's decision to migrate from Hewlett-Packard to IBM, as...

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An attractive financial package was the deciding factor in toy maker Lego's decision to migrate from Hewlett-Packard to IBM, as it looked to replace its legacy Tru64 and NT 4.0 systems.

Lego needed to replace its Compaq/HP Windows NT 4.0 and Tru64 systems with new Windows 2000 and Aix systems to avoid running unmaintained operating systems. Support for Windows NT 4.0 is due to end in December 2004. HP will stop shipping Tru64 in 2006.

Jan Amtoft, senior director, global IT at Lego, realised that he would need to make a change during the next five years in order to keep his systems current.

Given that migration work would be required to move off the existing IT systems irrespective of which supplier was used, Amtoft said he decided to run "a beauty contest" between the two leading suppliers, namely IBM and HP.

IBM won the bid, he said, because it offered a more attractive financial arrangement.

Tony Lock, chief analyst at Bloor Research, said, "Global financing is one of IBM's greatest strengths. It gives IBM great flexibility to shape any financial package."

Bloor said Tru64 users such as Lego face migration work to move off the Tru64 platform, irrespective of whether they buy a replacement system from HP or IBM. Given that the server hardware from the two suppliers would be similarly specified, any decision would heavily favour the more attractive financial package.

"While HP does offer financing options, it is not as flexible as IBM, which is the biggest finance bank the IT industry has," he said.

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