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Continuing to cater to its core server audience, Dell (Nasdaq: DELL) announced new PowerEdge servers and management software aimed at small and midsize businesses, and also pledged support for the low-price servers and their 64-bit capabilities.
Dell unveiled the PowerEdge 6800 and 6850 -- priced at about US$4,000 and $4,900 -- and said the Intel (Nasdaq: INTC) Xeon-based servers would be ideal for database environments, server consolidation and virtualization, and migration from RISC-based systems.
Lowering Barriers
Analysts indicated Dell was playing to its strength in smaller, lower-cost servers, but also noted the significance of the company's claim that the new servers will support popular database and server applications, including Oracle (Nasdaq: ORCL) and Microsoft (Nasdaq: MSFT) SQL Server, as well as 64-bit versions.
"The migration to 64-bit is not an easy commute, one could say," Yankee Group program manager Andy Efstathiou told TechNewsWorld. "This tells the marketplace they have a roadmap for that technology and that is backed up by their guarantee [of 64-bit support]."
Dell, which is much more dominant in the low than the high end of the server market, said the new PowerEdge servers represented the first time its four-processor servers were configured for application-specific performance optimization, particularly for databases.
The low-price machines also include Dell's new OpenManage 4.3 for server security, enhancement, monitoring and other management.
"With the launch of the PowerEdge 6800 and PowerEdge 6850, we have effectively lowered the barrier to entry for customers looking to deploy a high-performance, four-processor server for database environments," said a statement from Jeff Clarke, Dell senior vice president of the enterprise product group.
"While our customers continue to look to us for low cost, the real value we're offering is a tightly integrated solution of high performance hardware, certification with leading applications, complete management software and the professional services to ensure optimal installation and usage in their data center."
Low-End Leader
Efstathiou said that although Dell fails to keep up with market leaders such as HP (NYSE: HPQ) and IBM (NYSE: IBM) in the high-end server market, it is a leader in the lower-priced, entry-level market. He said the new PowerEdge servers were likely an effort to maintain that lead amid plans by the other giants.
"First of all, in terms of the [low-end] marketplace, IBM has big intentions in small to medium business," he said. "HP has big intentions too, although Dell -- they're really the incumbent one in the small to medium market."
Efstathiou said while Dell has built its market share with standard products at low price points, the company is also developing its offerings in terms of capabilities.
He also said the pledge of support for 64-bit transition was appealing to small to midsize businesses that are going to need help making the change.
Small Gets Big
IDC research director Steve Josselyn said that the bulk of growth in the overall server market is currently happening at the lower end, where servers are priced under $50,000.
"Certainly, we're seeing that the engine for growth in the market has come from the volume space as we define it," Josselyn told TechNewsWorld. "If you look at the overall market, that's where the bulk has been for the last year and a half."
While the analyst did not see the small to midsize market as a particular target of HP and IBM, he said there is a trend toward scaling out through provisioning and virtualization, as opposed to scaling up in one box through larger servers.
Josselyn called the management software announced by Dell a "necessary component" for deployment of the scaled-out environment.
"You need to provide a solution customers can put in and be able to manage," he said. "In the past, it was about throwing bodies at the problem, but that got to be far too expensive. Now, small and medium sized businesses are looking to automate and reduce complexity as much as possible."
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