Lenovo Says New ThinkServers Come With Double The Margins

Lenovo used its second annual Accelerate Partner Summit in Las Vegas Monday as the stage for unveiling two ThinkServers -- the RD530 and RD630 -- for cloud and virtualization deployments. The rollouts are part of a larger Lenovo initiative to expand its global footprint in the server market, a move the PC giant said will yield some of the highest channel partner margins in its history.

Lenovo is positioning the new RD530 and RD630 ThinkServers as its first enterprise-ready servers. The products veer from its traditional ThinkServer lineup, which has been sold predominantly in China, by delivering more than twice the memory bandwidth and increased scalability to accommodate larger workloads, according to Lenovo.

"The products we are announcing today are a step up from typical SMB towers," said Kevin Nelson, executive director of Lenovo’s newly formed Enterprise Systems Group.

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Designed to handle compute-intensive workloads, such as those in cloud-based or virtualized environments, the RD530 and RD630 ThinkServers are fueled by Intel’s Xeon E5-2600 processor lineup and include 320 GB of RAM. They also deliver a 160 percent power-per-watt improvement compared to prior ThinkServer products.

The RD530 and RD630 ThinkServers represent a larger effort on Lenovo’s part to move into the enterprise server and workstation market. The two products fall under the direction of the company’s Enterprise Systems Group.

Nelson said that channel partners, just as they have for Lenovo’s client division, will prove instrumental to its success in this new arena.

"We would not have grown as quickly as we have grown without the support of our partners," Nelson said Monday. "And we will not be successful in this part of the business without the support of our partners."

Partners that provide that support, Nelson continued, will reap the benefits of making double the margins they make today selling products from Lenovo’s client division. He outlined a number of partner offerings, such as a $250 instant rebate from distribution, TopSeller rewards programs and new customer bonus offerings, that promise to drive up partners' margins in the server space.

NEXT: Lenovo Has Its Eye On The Data Center

Lenovo also has lined up a more robust internal sales force to navigate partners through its revamped server portfolio.

"A year ago if you asked an internal sales rep, they would have a hard time explaining what a server is," Nelson said. Today, as part of the Enterprise Systems Group, dedicated group of reps for both ThinkServer and ThinkStation products are available to partners.

Although positioned as Lenovo's flagship enterprise server products, the one-way RD530 and two-way RD630 are still on the lower end of the market. But, from a storage perspective, this won't be the case for long. Nelson said new server products equipped with the storage capacity to support larger enterprises and, possibly even data centers, are already in the works, but Lenovo wants to gain traction in the lower-end space before taking its next step.

"The worst mistake we could make is going into the data center and making a mistake," Nelson said. "We're not going to run too fast too soon."

Lenovo's decision to enter the enterprise server space was prompted by requests from channel partners looking to sell end-to-end Lenovo solutions, according to Nelson. The decision also was sparked by the fact that only a few OEMs play in the enterprise service space, Nelson continued. Hewlett-Packard and Dell, two of the more dominant players, are poised to be Lenovo’s biggest rivals.

The ThinkServer RD530 and RD630 will be available in June, starting at $2,399 and $2,699, respectively.