IBM Aims To Expand pSeries In SMB Space

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CRN: Just how well is IBM doing in the Unix market?

Sanchez: We continue to gain share. In the last quarter our business grew 15 percent year over year.

CRN: What's driving that growth?

Sanchez: Unix is maturing. It's no longer just about performance and capacity. Now it's about how efficiently and reliably your infrastructure can deal with changes. To lead in this market today, you need a systems approach. It's all about the integration of the system and how flexible it is for the customer. That plays to IBM's strength. We're better equipped than our competitors to create reliable, efficient and flexible systems. What's driving the Unix market is economics and Power 5 takes the economics of this market to another level.

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CRN: How so?

Sanchez: We're doing that through better performance and pricing. Our 16-way server system supports more SAP users and a 72-way Sun system at one-third the price. We're also changing the flexibility equation with our virtualization and partitioning capability. In the typical Unix world, you have one application per server. That's why you see utilization rates of 10 to 13 percent. With our p5 systems, you can run two threads simultaneously and micro-partition the processor across multiple applications. It's a server consolidation play.

CRN: How does that compare to Sun?

Sanchez: Our systems are three times more powerful than anything on the market. The difference between us and Sun is that they talk and we execute. Sun today doesn't even publish benchmarks unless they are comparing themselves with themselves. The reason that we have been winning is that we are executing. We as a system manufacturer have a responsibility to provide a way for our clients to take better advantage of what we provide. That's what all the micro-partitioning in our system is all about. Whoever can provide more for less wins.

CRN: What are the goals for the coming year?

Sanchez: In the last year, we transitioned the entire product line and that went very well. Now it's about how do we drive volume. What we think will do that are our four-way servers and our blade products. Our main thrust this year is to capitalize on the products that we launched in the second half of last year. We're now down into the $10,000 server space, which will be fundamental to driving business through the channel. We have been extending our reach through our distribution partners and this year we will establish additional programs. Over two-thirds of our pSeries business comes through the channel. We believe that the way we grow is through our channel partners. We're going to reach into the SMB market this year. But at the end of the day, we're only as good as our channel partners are. From the channel on down, we continue to involve the channel in everything we do.

CRN: How does the pSeries play with the whole IBM On Demand strategy?

Sanchez: With us you can turn on and turn off processors and, more importantly, adjust workloads through our virtualization engine. You can adjust the granularity of the processor so you can adjust workloads dynamically. AIX sitting on top of that is what enables all that. We're also starting to ship some systems with all the processors. So if a customer buys a 16-way box, he might already have all 64 processors inside. It's the intelligence built into the system that allows adjustments to be made on a real time basis.

CRN: What are the most interesting opportunities that you see for growth?

Sanchez: If you look at the overall market, it's a $30 billion Unix market. But if you look at Linux, it's a $5.5 billion market. About half of that came from Unix and the other half from Windows NT. We're really going to go after the people that really like the reliability features of Unix, but did not like the economics of Unix. A lot of people moved to Linux on Intel because of the economics. The advantage of Linux on a Power processor is that we will give them the things they can't get on an x86 but at x86 prices. People don't change because they want to. They change because they are forced to. We are going to give people the stability they are use to at a price they want.