HP to Announce Entry-Level Unix Servers

SAN FRANCISCO (05/08/2000) - Hewlett-Packard Co. tomorrow will launch a new line of entry-level Unix servers, part of a broader effort to earn the vendor a bigger slice of the estimated US$10.8 billion worldwide market for such computer systems, company officials said today.

HP will also unveil a new program called Servers on Demand, which will allow customers to install the new servers at their premises and not pay for them until they actually switch them on, according to HP officials. The company will further announce that 20 additional software vendors, including Infoseek Corp., Intershop Communications Inc. and Chili Soft Inc., have ported software applications to HP's HP-UX Unix operating system.

The new servers are designed to help HP gain market share from Sun Microsystems Inc., which led the entry-level server market in 1999 in terms of unit shipments, said John Miller, a worldwide product line marketing manager at HP, in a phone interview today.

"The growth of the Internet is primarily being driven by these one- to four-processor kinds of servers; a lot of the growth is coming at this entry-level," Miller said. "Unit numbers motivate applications developers, and HP is very keen to maintain its broad portfolio of applications."

Sun has managed to position itself as a "dot-com" provider, a niche which has helped the company to secure new business among ASPs (application service providers) and ISPs (Internet service providers), two rapidly growing areas of the market, said Jean Bozman, a research director with International Data Corp.'s (IDC's) server group.

"HP has realized they have to be more aggressive about the Internet," she said.

Dubbed the HP9000 A400 and A500, the new servers will be available worldwide on June 1, and are aimed at service providers, Internet startups and large businesses, HP said. The A400 includes a single PA RISC (reduced instruction set computer) processor, 2G bytes of RAM (random access memory) and two I/O (input/output) slots, and starts at US$4,600. The A500 starts at $9,200 and includes two processors, 8G bytes of RAM and four I/O slots, Miller said.

The servers are available with either HP's HP-UX 11 or the Linux operating system, he added.

The two servers are rack-mountable and come bundled with a handful of key Internet software applications including Nokia Corp.'s WAP (wireless application protocol) server software, Infoseek's search engine, and load balancing software from Resonate Inc.

"We're focussing on four key areas: wireless, e-commerce, Internet infrastructure and content distribution," HP's Miller said. The inclusion of Nokia's WAP software makes HP's new servers "the first out-of-the-box wireless Web Unix servers in the marketplace," according to Miller.

The company is also committed to a six-hour repair time and providing Linux support directly from HP, Miller said.

The vendor's Server on Demand program aims to help companies deal with the unpredictable demand for server capacity created by the Internet. Businesses don't want to be caught offguard by the need for additional computing capacity, but they also don't want to pay for computers that they aren't using yet, Miller said. The new program allows businesses to have HP's servers in place but not pay for them until they are put into use, he said.

The program is "clearly a sign that HP is trying to innovate," IDC's Bozman said. "I don't know of anything out there that's exactly like it, although there may be something similar."

HP also introduced a new financing option aimed at startups that expect to grow quickly. Called Pay Per Forecast, the scheme allows companies to calculate their expected revenue for the coming months, and then pay HP for its servers in lease payments that grow along with the company, Miller said.

Hewlett-Packard Co., based in Palo Alto, California, can be reached at +1-650-857-1501 or at http://www.hp.com/.

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