Air NZ's Care bares Linux soul

Air New Zealand acting CIO Andrew Care is surprised at how much interest the airline's decision to run Linux on a mainframe has sparked. Since the news broke he has been busy fielding calls form other Kiwi corporates wanting to know more.

He admits it's a risk but says his visit to the LinuxWorld conference in the US last month left him feeling a lot more comfortable.

"It was actually IBM customers that convinced me. A lot of people have been doing stuff with Linux and IBM for two or three years. I ran across a company that has seven or eight [IBM] zSeries servers running web servers dotted around Europe. I found a whole bunch of people doing similar things, and not only through IBM introductions - just through chatting with people on the floor."

Care also went to LinuxWorld to find out how committed the vendors are in general.

"IBM is changing its internal systems - switching email to Linux so it's eating its own baking. Oracle is much more committed than I realised. A lot of its development is done in Linux and ported to other flavours of Unix. The Oracle database runs on Linux and it's also putting file clustering out to the open source world."

Even Microsoft had a low-key stand in an area for newcomers dubbed "The Rookery".

Care says Microsoft New Zealand has been careful in its response to the Linux announcement.

"It has asked us about what we're doing and said it wants to help us in reducing our costs."

He stresses that the decision to replace 150 Compaq servers running Windows NT wasn't done out of anti-Microsoft sentiment.

"We're sticking to reducing the cost of ownership. It's about getting an operating system that sits across multiple platforms; it becomes easier to move applications around. Ultimately software development will be less expensive because applications don't have to be ported to different operating systems and development cycles will be shorter. Open source means you have a large community developing software, which means it will develop at a much greater pace."

These issues are separate to the issue of Microsoft licensing, he says.

"Linux had been on the radar well before Microsoft started to do things with its licensing regime. We were looking at it two years ago."

In development the airline tends away from Microsoft; it's more of a Java shop than a .Net environment. "We aren't that big a deal with Microsoft in those kind of terms. It's more the influence our decisions might have on the market."

Another major Air New Zealand supplier looking down the barrels of Linux is Sun Microsystems, Care says. The rise of Linux is a threat to all the server companies, but he thinks Sun will have to change the most, though he doesn't see any large impact on Air New Zealand's use of Sun in the short term. The airline runs its midrange systems such as revenue management on Solaris, and will probably implement its newly chosen People-soft HR and financials on the same platform.

"People at the conference were saying Microsoft's dominance on the desktop won't change and Linux is being pushed from the server end. That's got to affect all the players - HP, IBM and Sun. I would have thought Sun has an issue. It has huge R&D in the Solaris and Sparc space and will probably have to make the biggest shift of anybody. Sun is pushing the line that Linux base command set is basically Solaris but I would think that that would make it easier to migrate. Especially as the Linux kernel gets better at handling multiple systems."

But change is not imminent.

"It's not something we would shift overnight. We would go through it very carefully," he says. "The beauty for us is we now have choice. Having a standard operating system means you could move around platforms more easily and drive down cost through consolidation. The ultimate aim would be to have a standard operating system across the high end, midrange and desktops. At the moment you need skill sets for each platform, which gives you overheads."

But change is something Air New Zealand's 280-strong IT staff must surely be used to as they strove to support the acquisition and merger of Ansett, only to have the freshly merged systems ripped apart again.

Last August the IT department was within three days of turning the lights on in a new data centre in Melbourne when the Air New Zealand/Ansett split was announced. The voice networks had been merged, as had the SAP engineering systems, and major supplier contracts had been consolidated.

What Air New Zealand termed the "de-merger" made for a fascinating three to four months, says Care in understated fashion.

"We had learned how to better run the mainframe environment because Ansett had been a lot more mainframe-oriented. We also realised we needed a decent middleware infrastructure so we could divorce some of the back-end and front-end systems. As a result we're doing a lot of work with EAI [enterprise application integration] using messaging and objects to integrate systems."

Care says throughout the merger Air New Zealand reduced its total operating costs for IT and was also successful in arresting and driving down Ansett's IT costs as well.

"It's about asking what kind of agreements can you structure? How can you help suppliers change they way they do things so they're profitable and they can pass that on to you? We look at technology that allows us to make stepped changes - hence Linux.

"We made the savings we told the board we would. Now we're investing in capital again. In fact, Air New Zealand's IT capital spending is increasing because previously the focus was on Ansett and Australia."

The capital spending kicks off with the Peoplesoft implementation which will cost about $37 million over six years including software, hardware and related staffing costs. Peoplesoft will replace Oracle financials, a multitude of HR systems and introduce a procurement system.

Air New Zealand is also looking at CRM and a customer reservation system.

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