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Since client-server computing hit the headlines in the early 1990s, industry experts and rival Unix server manufacturers have been predicting the death of mainframe technology.
Doug Nielson, system consultant at IBM's server group, said its new mainframe "charter" would dispel fears that mainframes have a limited shelf life.
The mainframe is the transactional workhorse platform in many industries, and is seen as a more reliable alternative to Unix and Windows-based systems.
The main thrust of IBM's charter is to ensure mainframe skills are not eroded, said Nielson. One way to achieve this is by allowing users to transfer Linux and open source software skills to the mainframe environment.
Mainframe memory has been reduced from about $50,000 (£32,000) per Gbyte to $10,000, and discounts will be given to users who buy IBM software to run new mainframe applications.
Phil Payne, principal at Isham research, said the price slash was, "The most significant price change I have seen in the past 20 years."
Linux users also benefit, with the fixed pricing for running Linux on a mainframe processor now set at $125,000.