IBM i Full Stack Software TCO

IBM i software TCO is rarely just the OS license line. A realistic multi-year TCO model stacks four layers: the software tier license itself (perpetual+SWMA or subscription), HA/DR and backup/security software, one-time implementation and services cost, and the ongoing operational cost of running it all. Skip any one layer and the comparison against an ERP replacement or cloud migration will be wrong.

The four TCO layers

Where the money actually goes

Across ERP-scale software projects generally, implementation -- systems integrator fees, data migration, training, change management -- typically represents 50-70% of first-year spend, with software licensing or subscription fees accounting for only 20-30%. That ratio holds directionally for IBM i software stacks too: the licensing number that gets quoted first is rarely the number that determines your first-year budget.

Cost per user vs cost per core

P05 and P10 licensing can be modeled per user or per core, with unlimited-user pricing crossing over around 50 users (P05) and 200 users (P10). P20 and P30 drop per-user fees entirely, so at those tiers cost-per-core is the only meaningful unit -- and it's the number to use when comparing an IBM i partition's software cost against a per-user SaaS ERP alternative on an apples-to-apples basis.

A worked example

Take the real Midland Information Systems example: a single S1122 partition with unlimited users and 256 GB memory runs $128,299.98 total, of which $84,698 (66%) is IBM i software, not hardware. Add a third-party HA/DR license (quote-based, not included), a backup/security stack (quote-based), and implementation labor, and the true five-year TCO for that single partition can easily exceed $250,000 once every layer is priced -- well above the $128,300 sticker figure most buyers anchor on.