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The xSeries may not get the press, but it still gets profits

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"> With all the excitement about Linux on the IBM mainframe zSeries and interest growing in the AS/400 iSeries, the popular xSeries servers are being overlooked. That's a mistake. Good, old Intel-based servers from IBM armed with Linux continue to move into small- and medium-sized businesses everywhere.

This follows IBM's success in the Intel server space. In 2001, a truly awful year for Intel server sales, IBM actually managed to increase its year-to-year revenue, according to Gartner Dataquest reports. For sheer numbers of total servers shipped in the first quarter of 2002, no-name white-boxes still lead the way with 27.4% of the market; followed by Dell at 26%, with its strong Red Hat Linux support; the combined Compaq/HP close behind at 25.5%; and IBM with a mere 13.3% of the market. But, the important news here is that Dell and IBM are gaining market share and while IBM's volume may be small, its profits are high. Is this an accident, with both Dell and IBM ahead of the others in throwing their support to Linux on the server?

It's no accident, according to Gartner Dataquest. While the Linux Intel server market remains small in terms of revenue, it's growing quickly and it's this growth that has enabled IBM to grab a bigger part of the server market pie.

And IBM knows this. Rich Michos, IBM's v.p. of Linux servers, says, "The Intel platform is the fastest growing platform, and Linux is the fastest growing server OS. Each year Linux is becoming more and more important to IBM and it gains a bigger share." To be exact, Scott Handy, IBM's director of Linux solutions marketing, says that 27% of new servers requests are for Linux servers." And, those requests are increasing.

IBM and the Intel Linux competition

Looking from the outside in, Bill Claybrook, the Aberdeen Group's research director for Linux and Unix, sees this trend, too. "Most people don't know this, but the xSeries is the main thrust of Linux at IBM." IBM insiders think that xSeries and the mainframe are the real Linux markets.

"IBM is in third place in server sales behind, Dell and HP/Compaq, but they're really pushing this market for Linux," Claybrook adds. "Specifically, IBM is looking to clustering and large server farms on Intel Linux because there's money to be made there."

As for IBM's competition, Claybrook says that "the reason why they're behind Dell and Compaq is that they had better Intel channels. When I think IBM, I don't think Intel. It's an image problem and people don't think of them when it comes to Intel servers." But, that said, "they're pushing hard on this area."

Michos knows that this is a problem. He says that one of the "primary things we're doing now is educating partners and sales staff about IBM and Intel. We're aggressively working with ISVs, resellers, and integrators to build a partner net so that we can get them to see that Linux is the future and that they should work with us."

And why not work with HP/Compaq or Dell instead? Here's Michos' answer: "Even combined, we're gobbling up Linux share from HP/Compaq. Compaq was a leader in the early days, but both Dell and IBM have gained." He says IBM is price competitive with both Dell and HP, and "there's a lot of confusion about what Compaq is doing with Linux and Unix, and that helps us." He also says Dell seems to be staying away from eight-way systems and "they're finding high-end Intel computing hard."

Looking ahead

The UnitedLinux effort, which had a lot of IBM support, will work for IBM's benefit because it will make porting software to Linux for both IBM and independent software vendors much easier and cheaper. Getting more software to Linux remains, to the IBM way of thinking, vitally important. Indeed, Claybrook thinks that it might be worth IBM's time to money to ISVs to get them to make ports on the xSeries.

Regardless of the financial details, in practice, IBM partners are moving applications to Linux. On June 12, for example, J.D. Edwards, a leading enterprise software company, announced with Ed Zanders, IBM's senior vice president and executive for its Server Group, that Edwards would be bringing its customer relationship management applications to the IBM xSeries. You can be certain that more ISVs will follow.

Specifically, when Michos looks ahead he sees IBM and partners' "next phase being retail and accounting applications." He says, "ISVs are starting to decide now is the time to get business applications to Linux. They're finally realizing that Linux isn't just a fad. What IBM will be doing to help this along will be "working with our business partners, to build integrated business application using Java and WebSphere on Linux." In the case of J.D. Edwards, for instance, the CRM applications will be relying on IBM's DB2 for its database and WebSphere for its middleware.

IBM is also working on its Redbooks and other documentation to better help its partners and customers deploy Linux.

Linux on the desktop

Despite all this effort to make Linux the operating system of choice on the Intel server, IBM remains cool to the Linux desktop. It's not that the company doesn't want Linux on the desktop, it's that the customers simply aren't there. Handy explains, "Customers want Linux on the server, but only 2% of our desktop requests are for Linux. That's not a sustainable level of demand. We've tried it, but the demand simply isn't there from the customers."

Still, he says, "we continually look at the Linux desktop, and we encourage activity in this area. Until we get customer acceptance, we won't have a broad play there."

IBM is aware that Linux fans want an IBM Linux desktop. A quick glance at DesktopLinux.com will show that. But, an ongoing survey on the same site shows that Mandrake and ELX Linux are the leading Linuxes for desktop Linux fans -- and neither of those is seen as top business Linuxes. IBM wants to sell to corporate users, not individual users. So as long as desktop Linux users are mainly Linux fans and not CIOs, IBM isn't likely to produce an end-user Linux desktop.

In the meantime, the increase in popularity of Win4Lin and Crossover Office may actually discourage IBM from investing the Linux desktop. After all, IBM also sells Windows desktop systems, and the Windows-on-Linux programs enable Linux users to run Windows applications, thus discouraging the Linux office and productivity ISVs.

That's not to say that IBM has totally turned its back on the Linux desktop. Indeed, in theory, you can get IBM EPro, MPro and ZPro IntelliStations and one ThinkPad, the A31P, with Linux preloaded today. Handy points out though that these are Linux desktops for developers, and come with development tools and no-charge copies of WebSphere, Domino, and DB2.

In practice, though, you can't order them off the IBM IntelliStation Web site; the online systems only come with Microsoft operating systems. When I called the IBM sales line, the people there told me that Linux wasn't available on any desktop machines -- including the developer workstations.

The point of the story if you want Linux on an Intel box, IBM is one of the places to go. If you want a Linux desktop on IBM, however, you'll need to do it on your own.

© Newsforge.com

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