Dell, IBM Punch Into Server Appliances
zdnet.com
Hi Kemble! Even more on Dell and servers! :)Leigh
By Todd Spangler, Inter@ctive Week
April 19, 2000 3:34 PM ET
Like fishermen looking for the next good spot to cast their lines, Dell Computer and IBM, two of the biggest PC server makers, recently started trawling in the Internet server appliance space.
Earlier this month, Dell (www.dell.com) - which sells about $40 billion worth of PCs over the Internet per year - launched PowerApp, a new line of special-purpose appliance servers, in an effort to generate more revenue from servers that make up the Net. Meanwhile, IBM (www.ibm.com) also announced its foray into Web server appliances with the Netfinity A100, the first in a series of Internet server appliances, according to the company.
The market for Internet server appliances, which are generally rack-mountable "pizza box" servers loaded with preconfigured applications, has been colonized by such start-ups as Cobalt Networks (www.cobalt.com), NETmachines (www.netmachines.net), Network Engines (www.networkengines.com) and VA Linux Systems (www.valinux.com). But now it's become such a fast-growing market that the big guns could not afford to ignore it anymore. In a report released last month, International Data Corp. projected that the worldwide appliance server market will grow from less than $1 billion in 1999 to $11 billion in 2004.
"We feel it's the right time to enter the market," says Karl Chen, director of marketing for Dell's Internet server products. "Up until now, there have only been smaller players who don't have the quality or the reach of Dell."
Why is demand for Internet server appliances especially sharp right now? Observers say it's due to the rise of Web hosting farms, where both slim size and the ability to get up and running quickly are of paramount importance.
Server appliances are designed to be fully functional out of the box. Whereas a typical general-purpose PC server might take two or more hours to set up, install and configure the applications, a server appliance is ready to go in a matter of minutes. Typically, server appliances are one-rack-unit (1U) high, which means they can be stacked up very densely in a service provider or corporate data center hosting facility.
Dell's new PowerApp line will initially consist of Web server and caching appliances. The PowerApp.web hosting appliance server will be available with either Red Hat Linux or Microsoft Windows. The PowerApp.cache runs Novell's Internet Caching System. The first PowerApp appliances are expected to ship in May.
Dell's strategy behind PowerApp is to provide relatively inexpensive, modular server building blocks for service providers that view their data centers in terms of revenue per square foot, as well as for Internet companies that prefer a pay-as-they-grow server infrastructure strategy, Chen says. "Service providers and dot com customers are looking for a cost-effective way to scale out the server farm," he says.
Jim Gargan, director of strategy and product marketing for IBM's Netfinity, says IBM has the broadest range of appliances and rack-mountable servers on the market, from its new A100 Web server appliance to the higher-end 6000R, a four-unit-high server with four processors and high availability features. By midyear, IBM will flesh out the A-series Netfinity family with a network-attached storage appliance and a caching appliance that uses software from either Novell or Inktomi, he says.
The entrance of Dell and IBM into the market hasn't made the smaller Internet appliance players too anxious - yet. "The big guys are standing up and taking notice that this is the preferred way people want to buy their servers, but this looks like it's sort of a toe in the water for them," says Bill Elliott, vice president of marketing at Network Engines.
Actually, Network Engines, which earlier this month filed to go public, has made a good amount of its money off licensing agreements with IBM, Micron Electronics and VA Linux. According to the company's regulatory filing, for the quarter ended Dec. 31, 1999, about 53 percent of its sales were to IBM.
Cobalt, meanwhile, will continue to differentiate itself based on the applications it offers on its RaQ and Qube appliances, says Kelly Herrell, Cobalt's vice president of marketing. Cobalt now has about 100 partners offering.
"The only thing the general-purpose server guys have discovered is that 1U matters," he says.
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At a Glance: Rack 'em up
Dell Computer and IBM recently detailed their first one-unit-high Internet server appliances PRODUCT DESCRIPTION STARTING PRICE
> Dell PowerApp.web Web server appliance available with either Red Hat Linux or Microsoft Windows $1,899 (Linux);
$2,499 (Windows)
PowerApp.cache Caching appliance based on Novell's Internet Caching System $4,400
> IBM Netfinity A100 Web server appliance based on Windows 2000, with IBM's Web acceleration software |
