Briefs: June 5, 2006

RED HAT LINUX 5 ENTERS BETA IN JULY
Linux

Beta 1 is slated to be available in late July, and Beta 2which will incorporate the Fedora Core 6 buildis planned for release in mid-September, said Daniel Riek, a product manager for Red Hat Enterprise Linux. The current Fedora Core 5 is pre-alpha code, Red Hat executives said.

At Red Hat Summit in Nashville, hosted by CEO Matt Szulik, the leading Linux company also announced the final feature set for its next-generation server and desktop platform. RHEL 5 will include core virtualization based on the Xen open source virtualization hypervisor as well as integration with the company's directory and certificate servers. It also will offer support for Intel and AMD virtualization extensions, stateless Linux clients, single sign-on and an improved driver model for third-party ISVs. Novell also has integrated Xen into its SUSE Linux Enterprise Server 10 distribution that was formally announced in March and is expected to ship this summer.

FEDERAL GOVERNMENT PLANS TO SPEND $65B ON TECHNOLOGY
The U.S. General Services Administration last Thursday asked the information technology industry for suggestions on its plan to offer governmentwide contracts valued at $65 billion over a 10-year period.

The agency's Alliant information technology program includes $50 billion that will be awarded to an estimated 25 to 30 companies in an open competition, it said. The remaining $15 billion in the program will be set aside for small businesses.

The Alliant program will use the money on technology for federal antiterrorism initiatives as well as for various government agencies' daily operations and efficiency improvements, said John Johnson, a GSA assistant commissioner.

The GSA issued draft requests for proposals, and wants the information technology industry to respond by June 30 with suggestions about minimum order size and other procedures.

The final requests for proposals will be published by October, with 10-year contracts awarded by the summer of 2007, it said.

STOCK MARKET WOES LEAD TO LOWER IT SPENDING FORECAST
IDC is lowering its expectations for IT spending.

The IT researcher's June FutureScan IT spending forecast, released last Thursday, strikes a sour note when compared with its May forecast, which predicted 7 percent growth through April 2007.

June's forecast brings the expectation down to 5.6 percent growth through May 2007. Still, it's a healthy growth rate when compared to GDP growth, both actual and expected.

FutureScan comprises two metrics: a market indicator, which fell in June vs. May, and a buyer intent indicator, which rose.

IDC said the macroeconomic portion of the market indicator was responsible for the drop in its forecast, primarily because the May stock market indexes fell in response to reports of a downturn in consumer confidence. However, vendor and buyer expectations, as IDC gauges by thousands of inputs including IT supplier capacity, channel and pricing dynamics, regulatory changes and customer sentiment, remained in alignment with each other as they both grew during May.

CRN's own research on IT buyer expectations shows that more than half of midsize companies expected in May that their IT budgets would increase in the ensuing 12 months and 94 percent of those companies expected the increase to exceed 5 percent.

HP, LOGICALIS SET OPEN DEMO CENTERS ACROSS THE COUNTRY
Logicalis and Hewlett-Packard are opening technology demonstration centers in solution providers' facilities across the country in an effort to offer customers migration and proof-of-concept testing on the latest HP technology.

"People won't buy [new HP technology] without seeing it," said Brandon Harris, director of ISG Partner Development for Logicalis. He said, for example, that the centers should help customers who are looking to migrate from HP Alpha to Integrity servers.

Logicalis, one of HP's largest North American enterprise solution providers, said the first center is opening in Cincinnati and will allow HP customers across the nation to experiment with different HP server, storage and software implementations.

The opening of the center marks the first phase in Logicalis' partnership with HP to help returning and potential customers conduct proof-of-concept and migration testing on the latest HP midrange and SMB technology, especially the Integrity servers, the latest Enterprise Virtual Array StorageWorks products and the pioneering BladeSystem infrastructure, according to Logicalis.

Harris said a Los Angeles HP demo center will open this summer and a Chicago center will open this fall. Logicalis also will begin implementing blade server demonstration capabilities in its offices around the country, including Atlanta and Boston.

The centers will offer full remote demonstration capabilities, so businesses can see the effects of different HP configurations on their operations from their own locations.

SOLUTION PROVIDERS APPLAUD SUN'S MOVES TO REDUCE COSTS
Sun Microsystems is making the right movesfinallywith steep cuts in head count and other costs in order to return to profitability, said some of its solution providers.

Sun plans to cut between 4,000 and 5,000 employees over the next six months, sell one of its campuses, get out of unneeded leases and rationalize R&D and other expenses in an effort to attain its goal of having an operating income of at least 4 percent of revenue during the fourth quarter of its 2007 fiscal year, followed by 10 percent for fiscal year 2008.

Cutting 4,000 to 5,000 people, selling unneeded real estate and getting out of leases is a nice beginning, said Tom Kuni, president of SSI hubcity, a Sun solution provider who has been calling for the company to return to profitability for years, including a recent two-year stint as co-president of Sun's VAR Council. "But why is Sun taking six months to do something that should be done immediately?" Kuni said. "Four-thousand to 5,000 is only half of what is needed."

That six-month timetable will be a huge distraction at Sun as employees wonder who will be affected and as they start interviewing for new jobs, Kuni said. "They should make the cuts now, and cut more than they need to," he said. "Cut once, cut deep, and not death by 1,000 cuts. This announcement shows Sun still is not making the quick and decisive decisions it needs to."

Rob Wolfe, president and CEO of AvcomEast, a Sun solution provider, said the changes were a long time in coming, but that Sun President and CEO Jonathan Schwartz and CFO Michael Lehman are finally making an impact at Sun.

"The impact on the channel is important," Wolfe said. "Sun needs to return to profitability."

Schwartz was not specific as to where the cuts would occur, only saying that they would be across the board, including R&D, sales, marketing and administrative personnel.