Unix vendors vie for affordability

Sun Microsystems Inc. on Tuesday launched a new addition to its Sun Fire server line, positioning the 12K as an upgradable compromise between its mid-range 6800 server and its top-end 15K system.

“”This system is absolutely ideal for today’s

cost-reduction projects. What are those projects? Server consolidation and mainframe re-hosting,”” said Shahin Khan, chief competitive officer for Santa Clara, Calif.-based Sun. Khan said the Sun Fire 12K’s mix of functionality of and cost-effectiveness will allow Sun to gain mid-range market share at the expense of Hewlett-Packard Co. and IBM Corp.

“”In the areas where Sun does have a presence, Sun is planing to lead. We’re No. 1 in the high end, number one in the low-end,”” Khan said. “”This will slam the door in the face of (IBM’s) Regatta and (HP’s) Superdome.””

But the 12K’s mid-range competition is not limited to the Regatta and the Superdome. On Tuesday, IBM unveiled its own high-performance-lower-cost system, the p670, which has a price tag of between US$180,000 (four partitions) and US$535,000 (16 partitions). The 12K, which sells for US$750,000, will also have to battle with HP’s US$125,000 rp8400, released last September.

“”I think both offerings (the 12K and p670) bridge the gap that we already bridged,”” said Lorne Weiner, HP Canada Ltd.‘s marketing manager for enterprise server solutions. “”I think we invented the idea.””

Indeed, there is a movement towards affordability by Unix server vendors, according to Jean S. Bozman, Global Enterprise Server Solutions research director for IDC.

“”What you see here is an interest on the vendors’ part to bring prices down,”” she said, noting that last year’s economic malaise spurred an increased interest in entry-level sever units. IDC defines entry level as costing between $0 and $100,000, mid-range as costing between $100,000 and $1 million and high-end as priced higher than $1 million. “”By bringing the advanced functionality to these lower price points, that is a statement by these competitors that there is an opportunity, even during the downturn, to sell mid-range servers.””

According to IDC, Sun had 24.7 per cent of the US$9.9 billion worldwide mid-range market in 2001, putting it in third place behind both HP (30.7 per cent) and IBM (27.3 per cent). The mid-range rankings were the same in Canada, with HP holding 38.6 per cent of the market, IBM at 33.5 per cent and Sun at 22.7 per cent. However, Sun was the top overall worldwide Unix server vendor in 2001, with 30.7 per cent of the market. In Canada, Sun (32 per cent) finished second behind HP (34.5 per cent).

By IDC’s definitions, Sun’s 12K is a mid-range offering, as is the 6800, which sells in the half-million (US) dollar range. But the 12K is also Sun’s attempt to carve out a place in the upper-middle-class server category. Clark Masters, Sun’s enterprise systems products vice-president and general manager, said the 12K is really a “”less-than-fully”” populated version of the 15K.

The 12K, he said, can be upgraded to 15K capability without taking the system down, though he admitted buying a 12K and upgrading would in the long run be more expensive than purchasing the 15K outright. Masters suggested the 12K would steer some potential 15K customers down to and some potential 6800 customers up to the 12K.

Khan stressed the importance of Sun’s Uniboard design, used in both the 12K and 15K, which affords interoperability across Sun’s UltraSPARC/Solaris-compatible group of servers.

“”It’s very simple,”” Khan said of Sun’s strategy. “”Uniboards on the high end, Blades on the low end. And we think that’s where the future is going to be. In three years, you’re going to see other companies duplicating this strategy.””

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