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Steve Jobs chucks Apple server biz from pram

XServe bites the dust. And so much more

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Comment Like any other billionaire — or three-year-old — Steve Jobs does exactly what he wants to do, and stops doing it when he's no longer interested. Last week, Jobs pulled the plug on Xserve machines, and though companies that depend on Apple's servers and related Xsan2 clustered file systems may have been a bit shocked when it happened, they should remember the on-again, off-again history of Apple in the server racket.

This is exactly the sort of thing you'd expect. The handwriting was on the wall earlier this year when Apple didn't refresh its two-socket, rack-mounted server with Intel's latest six-core "Westmere-EP" Xeon 5600 processors — something that was, from an engineering point of view, relatively easy to do.

That's because the Xeon 5600s are socket-compatible with the quad-core Xeon 5500s that were announced in early April 2009, only a few days after Intel pushed out these "Nehalem-EP" server and workstation chips into the gaping maw of the Great Recession and defied it.

The Xeon 5500s offered a huge performance boost for many workloads compared to previous Xeon 5300 and 5400 processors, mainly due to the switch from the frontside bus architecture to the QuickPath Interconnect point-to-point interconnect used with current Xeon servers. The Xeon 5600 rev happened a year later, and most cases, all server makers had to do to refresh their lines was to certify the new chip, add support for fatter 8 GB and 16 GB DDR3 memory sticks as well as low-voltage 8 GB parts, maybe put in a higher-efficiency power supply, and cram in a few more disk drives in a clever way in their 1U, 2U, and 4U rack form factors and tower equivalents.

It is the height of laziness and selfishness that Apple has not long-since done this, and it is a disservice to Xserve customers that Apple is not revving the Xserves with Xeon 5600s, fatter memory, and faster and more capacious disks as it begins winding down the Xserve product line. Apple could also have given customers just a little bit more warning.

According to the Xserve Transition Guide that Apple put out last week, the company will sell Xserve machines through January 31, 2011 with the standard one-year warranty. The company also pledges to honor any and all warranties for Xserves and will ship 160GB, 1TB, and 2TB disk drive modules until the end of 2011. When supplies run out, that's it. You'll be hunting around the Web for second-hand dealers for parts.

To put it bluntly, this bites.

Come on, Steve, You've got the cash

A company with $11.3bn in cash and equivalents, $14.4bn in short-term investments, and $25.4bn in long-term investments can afford upgrade the Xserve line one more time and give customers some breathing room. But Apple clearly has other priorities, chasing the wider consumer market and the vast profits it can extract from glossy-eyed people trying to up their cool quotient by having the latest Apple iGadget.

The server business for Apple has always been a bit of a drag, although there certainly was some enthusiasm in the years after the launch in May 2002 of the Initial PowerPC-based Xserves. At the time, Apple CEO Jobs tried to reassure customers that the prior years of short-lived server products were behind the company. "I look at that as a dream while [Apple] was in a coma," Jobs explained, almost in apology.

Maybe this is one of those dreams within a dream moments and Apple never truly woke up?

Apple never aspired to move beyond its targeted educational, media, and research markets with the Xserve servers and their companions, the Xserve RAID disk array and the Xsan2 clustered file system. Those disk arrays and the Xsan2 software are what makes the Xserves actually useful for the digital-media and workgroup-serving jobs that Xserve shops run out there in the data closets and data centers of the world.

Back in November 2004, an Xserve cluster running Mac OS X Server at Virginia Tech was ranked number seven on the Top 500 list of supercomputers. At the time, Gartner said that Apple's server business was doubling, and Apple even confirmed that it was shipping around 13,000 units a quarter. It looked like the company finally was going to break into the big time in servers.

But Apple's phenomenal success with MP3 players and the online music business, then in handheld phones, and now with tablets means Apple doesn't have to care about servers. At least, that seems to be the thinking. But that could very likely turn out to be faulty reasoning in the long-run.

Those commercial products have revived Apple's PC business, and there is no reason at all that enterprises that are now integrating Apple devices with their IT applications might not also want to use Apple systems on their back-end. The opportunity for cross-selling is huge, if Apple played it right. But that would also require a sizable investment in expanding the Xserve server and storage lineup, and quite frankly, Apple has other ways it can make money more easily.

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