New IBM servers challenge Sun and HP

New Unix servers announced by IBM yesterday should close a widening price/performance gap in the midrange market against rivals such as Sun Microsystems and Hewlett-Packard, users and analysts said.

IBM fleshed out its Unix server lineup with three new models featuring the same copper technology and many of the features found on its popular high-end S/80 RS/6000 servers.

New features include hot-swappable components such as hard disks and CPUs, dynamic CPU de-allocation for isolating potential processor problems, redundant power and cooling systems and a service processor for monitoring system vital signs.

Also offered are a range of high-availability services and technologies, such as clustering targeted at service providers and e-commerce applications.

The least expensive model starts at $18,995 with the top-end system beginning at $67,995. This should make the new servers attractive to users, said Richard Fichera, an analyst at Giga Information Group.

"The systems look impressive and are certainly going to help IBM put some pressure on Sun and HP," Fichera said.

Ursus Telecom, an Internet service provider in Sunrise, Florida, plans to deploy the servers in several locations worldwide for its Stream.com Internet telephony offering, said S. Jay Chavez, a vice president there.

"From what I have seen of these systems, they come in at about two-thirds the price of a comparable Sun system," Chavez claimed.

"I think they are leapfrogging the competition" in terms of technology, said Hugh Hale, a senior manager of information systems at Blue Cross/Blue Shield of Tennessee in Chattanooga, which uses S/80s to run its managed care application.

IBM's latest midrange offerings come at a time when its S/80 systems - announced last fall - may finally be gaining some ground against Sun's popular E10000 servers, said Lee Kroon, an analyst at D. H. Andrews Group in Cheshire, Connecticut.

"IBM shipped a thousand of those systems in the first 100 days. It clearly ruffled Sun's feathers' pretty badly," Kroon said.

Making an impression with products such as these is going to be crucial if IBM is to reverse its hardware slump, said Sam Albert, president of Sam Albert Associates, a consultancy in Scarsdale, New York.

Earlier this week, IBM CEO Louis Gerstner advised analysts not to expect any dramatic growth from IBM this year because of the unexpectedly long time it was taking for companies to start buying enterprise servers after the Y2K lockdown. Financial analysts promptly lowered their expectations for IBM for the rest of the year.

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