November 10, 2002 9:00 PM PST

A power server for penny-pinchers

IBM will release a new eight-processor server for the Unix market on Monday aimed squarely at IT buyers on a budget.

The p650--featuring a new version of IBM's touted Power4 chip--will allow Big Blue to better take on Sun Microsystems and Hewlett-Packard in the mid-range Unix server market in terms of price and performance.

"In today's economy, if you give a customer a choice of spending less, he will take it," said Karl Freund, vice president of product marketing for pSeries servers at IBM. Freund added that IBM's current servers "are not as aggressively priced."

Eight- and four-processor Unix/RISC servers largely are launched to run large databases or complex inventory applications such as those from SAP. Although servers containing Intel chips account for more machines in terms of units, Unix/RISC servers are more profitable, often selling for well over $100,000.

The p650 itself starts at $29,995 and runs as high as $129,995. That's around the same range, if slightly lower, than existing servers from Sun. The new system, though, comes with chips running at higher clock speeds.

For the past few years, Sun, HP and IBM have jousted for dominance in the field, undercutting each other on price and performance while trying to steal accounts from each other through complex service and product deals. Sun in particular has worn a target on its back because of its success in the late '90s.

"They (IBM) define their competition as Sun," said Jean Bozman, research vice president at market research firm IDC. "If they really want to be tough about it, they can pack PCs or other services in the same basket."

Sun representatives pointed out that the company is the leader in the eight-way server space and even gained market share in the second quarter, while IBM and HP lost market share.

The price drop, in part, comes from IBM's expanded use of the Power4 chip family. Unlike other server chips on the market, members of the Power4 contain two processing cores, the functional brain inside microprocessors. Therefore, to build an eight-processor server, IBM only has to insert four chips inside the box, which allows the company to economize on space and other components.

The Power4 chip initially came out in the "Regatta" server line, which holds up to 32 processors (contained on 16 chips). In August, the company came out with a four-processor (two chip) pSeries server. The new box effectively fills the gap between those two.

The p650 actually contains a new version of its Power4 chip called the Power 4+. The Power 4+ is manufactured on the 130-nanometer manufacturing process, making it faster and more energy efficient than existing Power4 chips, which are made on the 180-nanometer process. (The nanometer measurements refer to the average size of features on the chip. Performance goes up when features shrink because electrons have to travel less far.)

 

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