Microsoft's server u-turn

Big iron's OK by us

For years, Microsoft has argued that servers containing only a handful of processors are good enough for most of the world. But now, with the advent of huge Intel machines and the approaching release of a new version of Windows that will run on them, the company is changing its tune. For heavyweight business computing jobs such as housing a large company's sales transaction database, Microsoft's preferred philosophy has been to share the load among lower-end servers grouped into a "cluster". It's been a tough sell, however, with large corporations sticking with mainframes or Unix servers. But the coming .Net Server 2003 version of the Windows operating system, combined with the faster Intel servers on which it will run, has spurred Microsoft to start talking more seriously about large multiprocessor servers, known in the trade as "big iron". "Some of the benchmarks out there are really quite phenomenal," Microsoft chairman and chief software architect Bill Gates boasted last week during a speech at the Comdex Fall 2002 trade show in Las Vegas. "The number of processors built into systems is now building up to 32 and 64." Microsoft knew full well that there was a place for big iron, said Illuminata analyst Jonathan Eunice, but salespeople know to sell the wares they've got in hand. "You're not going to sell what's five years in the future," Eunice said. "They finally have the goods." Though Unisys' 32-processor ES7000 server has been available with Windows for more than a year, the speed record Gates referred to was set by a new NEC server with 32 Itanium processors. That system climbed higher than any other Windows server on the most widely watched server speed test, processing transactions about 50 per cent faster than the previous Windows champion and within striking distance of the top Unix servers. While customers won't rush to buy the latest speed demon without a full suite of software and a healthy dose of internal tests, such benchmarks give Microsoft, Intel and their allies a more serious claim to the high-end server market, where prices, prestige and profit margins are higher. The high-end market has been a sanctuary for Sun Microsystems, an avid Unix fan which, unlike IBM and Hewlett-Packard, has steadfastly refused to sell Windows. "They're definitely breathing down the necks of the Unix guys," Eunice said. Sun remains unfazed. Its Sparc processor and Solaris version of Unix have "a commanding lead in 64-bit servers and will continue to lead in the data centre as an ideal platform for server consolidation, transaction processing, data warehousing and mainframe re-hosting," Shahin Khan, Sun's chief competitive officer, said in a statement. Intel servers today use 32-bit processors such as Pentiums or Xeons, but the company's 64-bit Itanium can address vastly larger amounts of memory. Microsoft already has begun adjusting to this comparatively unfamiliar world where fewer systems ship but where prices are higher. Server companies must pay Microsoft $24,000 for a copy of its top-end DataCenter version of Windows 2000, said Mike Mitch, senior marketing director of servers for NEC in the Americas. Already the economic recession and intense competition has forced Sun, HP and IBM to discount their Unix servers, and the future doesn't look much brighter. Research company Gartner Dataquest projects that Intel servers in 2003 will for the first time generate more revenue than Unix servers - $20bn, compared with $18bn. Stephen Shankland writes for News.com