IBM Pushes Power, Price of 16-Way Server

Big Blue unveils its most powerful Intel-based server yet, the 16-way X440, whose price it claims is well below competitors'.

IBM unveiled Wednesday its most powerful Intel-based server yet, the 16-way X440, underscoring the computer makers intensifying campaign to boost its position in that market segment.

The "building-block style" server, which can scale from two to 16 CPUs, features the new Xeon MP processors running at speeds up to 1.6GHz that were released this week.

The system is targeted at the high-end Intel-based enterprise space that industry analysts contend is becoming increasingly important and hotly contested.

"This market segment has grown quite robustly over the last five years," said Illuminata analyst Jonathan Eunice. "You dont sell as many of these big systems as you do cheaper Web servers, but they are becoming pretty popular."

While IBM claims it holds a competitive edge in the high-end Intel segment thanks to technologies it can leverage from years of developing mainframe systems, Big Blue is also touting a much simpler sales pitch--low prices.

In promotional materials, IBM notes that a 16-way X440 with 16GB of SDRAM priced at just over $100,000 costs about 78 percent less than a comparably configured 16-way Unisys ES7000, and 47 percent less than an eight-way Intel-based server sold by Compaq Computer Corp., based upon a comparison to an X440 outfitted with eight CPUs.

Prices for the X440, which will start shipping in July, start as low as $18,500 for a two-processor configuration and climb up to well over $100,000 for more fully equipped systems.

"IBM is very hungry, and they see price competition as a big place they can play," Eunice said. "They got their butts kicked throughout the 90s in their server line. But now theyre fighting back. They are not particularly happy about the billions of dollars companies such as Dell Computer Corp. and Compaq Computer Corp. have been able to take away from what they see as their own backyard."