Five years ago: Compaq sub-£1,000 server wrongfoots rivals

Compaq is to go into the entry-level server market with a sub-£1,000 machine

First published 13 January, 1997

Compaq today drove aggressively into the entry-level server market with a sub-£1,000 machine. This is an arena where big bucks can be made from high-volume sales, and marks out an important strategic move for the US giant.

The ProSignia 200 (£995 +VAT) is a 166MHz Pentium-based server with 512Kb cache, 16Mb RAM, eight-speed CD-ROM drive, NetFlex 3/P Ethernet controller, and Compaq's Automatic Server Recovery (ASR-2) technology. A Wide Ultra SCSI storage option is also available.

"The ProSignia 200 is a network server that's priced below a desktop PC," said Hugh Jenkins, systems group product manager for Compaq. "The IBM equivalent is nearly twice as expensive. Some people are asking 'where's Dell'? Dell do not even have a product in this category. They've overshot the small to medium business market."

"We are absolutely determined to make sure we remain a server market leader and that our market share is not undercut from below," added Jenkins. "Only the paranoid survive, as Andy Grove said."

Jenkins said the sub-£1,000 price point will boost volume sales to small and medium-sized firms: "We think the volume players are the ones who are going to win this year. IBM and HP are realising that."

Separately, sources close to Compaq said it will announce a mid-range server within the next few weeks. The dual-processor ProLiant 800 will start at around £1,150, and support 180MHz and 200MHz Pentium Pro processors. It will offer a 256Kb cache, 32Mb RAM, eight-speed CD-ROM drive, Wide Ultra SCSI drive, and ASR-2.