IBM Seeks to Revive Its Line of Large Computers

International Business Machines gave new life to its line of large mainframe computers Tuesday by introducing new models and cutting prices on others.

Although IBM dominates the world market for mainframes, slow sales of the big machines last year in the United States contributed to the company’s first annual profit decline since 1979. IBM earned $6.56 billion in 1985, down 0.4% from $6.58 billion a year earlier.

IBM announced two smaller models of its most powerful mainframe, the 3090, which has sold well since it was introduced last year. It also doubled the possible storage capacity of existing 3090 models and announced it has upgraded its smallest line of mainframes, the 4381. The upgraded 4381 will have about 33% better performance than the old ones for slightly lower prices, IBM spokesman Rick Bause said.

The improvements will make IBM a more dangerous competitor to other makers of small mainframes and makers of superminicomputers such as Digital Equipment and Data General, said Rick Martin, an analyst for Sanford C. Bernstein & Co.

IBM has fewer competitors at the top end of the mainframe business and cut its prices there by less, Martin said. IBM reduced the purchase price of its existing 3090s by about 10%. It also announced a 21% cut in the price of its older 308X mainframes, which have been in production for about four years.