The name-calling, bitch-slapping, suit-countersuit fight between IBM and Neon Enterprise Software hasn’t deterred the uppity Texas ISV from trying to crack IBM’s mainframe monopoly.

On Tuesday it wheeled out a new release of zPrime, the software that IBM has declared contraband, the stuff that slashes the cost of mainframe computing by offloading massive amounts of work from System z mainframes to low-cost IBM specialty processors (SPs).

Neon claims it’s legal; IBM claims it’s not, branding the company owned by BMC co-founder John Moores a “thief” and a “pirate” and a few other choice epithets meant to dissuade mainframe installations from taking up with Neon.

The new zPrime 2.1 is bound to get a similar rise out of Armonk because it expands the types of workloads that can be offloaded to SPs.

Neon says that up to 90% of all CICS workloads can now be offloaded to the SPs, and virtually all DB2 workloads. Mainframe administrators can also ensure maximum SP utilization and fine-tune it to match specific needs with less intervention than previous zPrime versions.

This stuff gets IBM’s knickers in a twist because it doesn’t charge for running workloads on the SPs, which are just mainframe central processors masquerading under a different name and were dreamed up to keep mainframe users from running off and using commodity servers for their XML and Java apps or to accelerate DB2.

Even though IBM has been unable to produce any workload-restricting licenses saying so, it contends that mainframe users are contractually restricted from running anything but IBM-authorized workloads on the widgets. It is also trying to undo its legal oversight by asking users – especially those who want to buy new specialty processors – to sign retroactive agreements that would foreclose their right to use zPrime. Neon calls that an antitrust violation.

Anyway, Neon said that eight companies moved into production with zPrime 2.1 Tuesday when the stuff went gold. They’re not customers yet but they all did a proof of concept and probably soon will be.

The eight must be exceedingly brave as well as utterly fed up paying IBM’s notoriously exorbitant monthly licensing fees because Neon’s antitrust suit accuses IBM of threatening retaliation against users that dare to use zPrime software. Neon said IBM threatened to sue them, jack up their mainframe fees and curtail its maintenance and support.

Neon CEO Lacy Edwards says IBM continues to interfere with his business but so far its threats have proven mere bluster. Tellingly, all of the customers who have bought zPrime have stuck with it. Nobody has dropped out.

Edwards says he knows of no case of IBM adjusting upward a zPrime customer’s perforce lower bills and it’s had a good six months now to make good on that particular threat. And of course no one has gotten sued. If IBM sued a customer we’d be reading about that on the front page of the Wall Street Journal.

One account reportedly signed IBM’s new change-the-rules anti-zPrime licensing terms without knowing that zPrime existed or realizing its consequences. It apparently feels deceived by IBM because it means to go ahead and buy zPrime anyway, Edwards said. Presumably it will tell IBM it can turn blue.

Reluctant under the circumstances to say how many customers zPrime currently has, Edwards does claim that sales are growing quarter-on-quarter in the US, Europe, Latin America and Australia and that they represent “million of dollars” in recurring annual license fees. Those millions are probably under $10 million, but it’s a bigger loss to IBM.

By way of outreach to skittish accounts spooked by IBM, Neon says “IBM’s legal team has the zPrime source code, so IBM should have confirmed by now that our code does nothing IBM alleges” like misappropriate IBM IP or infringe IBM copyrights.

IBM has had the code for two weeks and Neon claims that it would take IBM about the space of a NDA test to see any misappropriation or infringement.

It will be interesting to see if IBM modulates the names it calls Neon any in light of discovery. Neon says it’s turned over everything IBM asked for.

Jury selection in its antitrust case against IBM has been set to start March 12, 2012; Neon was hoping for next year and is disappointed.

Obviously Neon would be helped along if the European Commission and the US Justice Department move on their on-going antitrust investigations of IBM and the mainframe market.

Neon says zPrime 2.1 is much easier to install than its predecessor and ready to run in less than 30 minutes with no JCL changes, system exits or restarts of any z/OS subsystem.

Its new “Scan” interface monitors the system at user-designated intervals for tasks to be made eligible. Working with zPrime’s “Attach” interface, which uses the standard z/OS interface to enable workloads when tasks are started, it gives administrators the versatility necessary to maximize specialty processor utilization according to their specific needs. zPrime no longer uses z/OS exits for workload enablement.