October 30, 2000 9:55 AM PST
HP servers top array of new Micron offerings
The Nampa, Idaho-based PC maker Monday refreshed its notebook line, added 1.2-GHz Athlon processors to its desktop lineup and cut a deal whereby Hewlett-Packard will make servers for Micron.
The HP deal is perhaps the most significant part of the announcement, as Micron has been overshadowed by industry leaders in selling servers. Under the terms of the agreement, HP will manufacture the servers, which will be co-branded with Micron.
Both companies are expected to benefit from the arrangement, which should add to the volume of servers HP sells. Micron, which offers systems directly to customers, will bring HP's NetServer to a broader market, since HP largely sells systems through dealers.
Micron immediately will offer four NetServer models: The LH 6000 database server, the LC 2000 workgroup server and the rack-mountable LPr and Storage 12 models. In December, Micron will add the NetServer LT 6000r and E 800 to the lineup.
Gartner analyst Kevin Knox described the deal as a "win-win for both companies," even though it will have little impact on either's server-market share.
"Micron has been fading and dwindling in the server space, and they really never got the benefits of the NetFrame acquisition," he said. "They really didn't have a technically differentiated product, and in many cases it was hurting them in deals."
Micron acquired NetFrame in July 1997 in an attempt to bolster its server line. But the company's indirect sales channel did not mesh well with Micron's direct sales strategy, Knox said. Micron also failed to dedicate the research and development dollars necessary to expand the server line and show commitment to the market space.
"The HP deal is going to give Micron a broader product line and reassure some customers about servers, whereas before people had lots of concerns about Micron's commitment," Knox said.
On the desktop, Micron has extended a commitment to deliver systems using processors from Advanced Micro Devices. At the request of Best Buy, Micron in late September started offering AMD's 700-MHz Duron systems through the retailer.
"Micron was one of the last holdouts when it comes to AMD," said PC Data analyst Stephen Baker.
Compaq Computer, Gateway and IBM are among the other major PC makers selling systems using AMD processors.
Initially, Micron offered AMD processors only at Best Buy, where it sells some five models on store shelves. The shift to Athlon changes Micron's commitment as it begins to market AMD-based systems directly.
Micron's move to DDR, along with other PC makers supporting Athlon, sets the stage for a memory war going into next year. While AMD backs DDR, rival Intel has committed to using competing Rambus DRAM with Pentium 4.
Micron has priced the Millennia Max Xp aggressively. The new PC starts at $1,999 with a 1.2-GHz Athlon processor, 128MB of 200-MHz DDR memory, a 64MB NV15 GeForce 2 graphics card, a 20GB hard drive, a 12x DVD-ROM and a 8x/4x/32x CD-RW drive, a 56K modem, speakers, a 17-inch monitor, Microsoft Office 2000 Small Business Edition, and the Windows Me operating system.
Micron starts taking orders for models with 266-MHz DDR memory as of Nov. 6 and expects quantities to be limited until December.
On the portables front, Micron added two new TransPort models, the GX and GX+. The new models, which weigh just less than 7 pounds, are nearly identical, except for the size of the display. The new portables replace the TransPort ZX and can use the same drives and components as the to-be-retired notebook.
The Transport GX sells for $3,499 with an 850-MHz Pentium III processor, a 14.1-inch Super XGA display, 128MB of SDRAM, 16MB of video memory, an 8x DVD-ROM drive, an integrated modem and network card, Office 2000 Small Business Edition, and Windows 2000. The Transport GX+, with a 15-inch display, costs $100 more.