Dell Adding Servers, Services For Larger Slice Of Data CenterDell Adding Servers, Services For Larger Slice Of Data Center

Dell plans to launch next week 14 new products, including servers powered by Intel's latest Nehalem processor and better system management tools that the computer maker hopes will attract a larger slice of corporate spending on data centers.

Dell's unveiling of the portfolio Wednesday at a San Francisco news conference highlights the intensifying competition among vendors for company's computer rooms. Cisco last week introduced a new series of blade server products that includes storage capabilities along with virtualization and server management software.

Also providing a backdrop to Dell's latest announcement are media reports that IBM is in talks to buy Sun Microsystems, a move that would increase IBM's footprint in data centers through the acquisition of Sun's server lines. In addition, Dell's major rival, Hewlett-Packard, has been boosting its investment in networking gear.

Dell's plans to offer Nehalem-based PowerEdge servers and Precision workstations, along with a refreshed line of EqualLogic storage arrays, is not surprising. Every maker of Intel-based servers, including IBM and HP, will offer similar products. Nehalem is the code name for a new microarchitecture underlying Intel's Xeon processors that significantly boosts performance from current-generation chips by placing a memory controller next to the main processor on the same piece of silicon.

One area where Dell hopes to gain ground against rivals is in its system management tools, an area where it lags behind HP's OpenView product line.

"HP has a really strong advantage in management right now," John Spooner, analyst for Technology Business Research, told information. "Customers are pretty happy with their tools."

To draw attention to its new hardware, Dell plans to offer a single software console that customers can use to conduct a host of tasks, such as managing server hardware and virtualized environments, diagnostics, operating system monitoring, and application updates. The software, which is based on Symantec's Altiris system management technology, essentially takes what use to be nine separate consoles and consolidates them on to one pane, according to Dell. The other big improvement is the embedding of all pre-deployment drivers, management tools, update, and rollback utilities and more in flash memory within the server. This eliminates the need to ship each computer with a half dozen disks that IT staff would use to install the software.

In addition, once the customer configures the hardware, the data is stored in memory and can be uploaded to Dell as backup and easier deployment on new systems. In addition, Dell could use the information to deliver to a customer future systems with the custom settings.

Because most of the core hardware components in x86 servers from the different vendors are very similar, along with the pricing, the best way to differentiate products is through management tools. Dell's latest moves indicate an understanding of that reality, Spooner said. However, Dell is playing catch-up in this area, so it'll take time to see whether the vendor makes any progress against rivals.

"Time will tell," Spooner said.

Indeed, Dell is ranked third in the worldwide server market in terms of revenue after IBM and HP, according to IDC. In fiscal 2009, servers and networking products made up 10% of Dell's revenue, with services accounting for 9% and storage 4%. Dell's PC business brought in about 60% of the company's revenue.

Dell plans to release details and benchmarks of its products on Monday to coincide with Intel's official launch of Nehalem for servers.

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