Unisys Corp. Unveils Plans for Moving a Big Box - e-Action ES7000 servers - Company Business and Marketing

ENT, April 12, 2000 by Scott Bekker

There may only be one vendor capable of building 32-processor-capable servers for Windows 2000 Datacenter Server right now. But if Unisys Corp. has its way, those boxes will seem to be coming at customers from every direction.

Unisys' (www. Unisys .com) e-Action ES7000 servers are based on the company's Cellular Multiprocessing (CMP) architecture. The machines can run one instance of Datacenter Server on up to 32 processors or can be split up into to eight partitions of four processors each.

The company won validation of its machines in mid-February when Compaq Computer Corp. (www.compaq.com) signed on to OEM the machines under the ProLiant server label. Unisys expects to see $400 million over two years from the arrangement. Previously, Unisys announced another OEM deal with International Computers Ltd. (ICL, www.icl.com).

The OEM path is one of four approaches Unisys will take to sell the ES7000, says Don Johnson, head of the enterprise server business at Unisys. The four paths are direct sales; sales through resellers that can do mission-critical applications; OEM sales through Compaq, ICL, and possibly others; and sales indirectly generated from Microsoft Corp. (www.microsoft.com) and Intel Corp. (www.intel.com) marketing of the capabilities of the Wintel platform on the ES7000.

For this year, direct sales are most important. "The majority of our sales will come out of our direct sales force focused on our top 1,000 accounts," Johnson explains. He expects the reseller and OEM sales to become significant sometime in 2001.

Microsoft and Intel have the same interests as Unisys in pushing the CMP boxes as they try to push Windows 2000 Advanced Server and Windows 2000 Datacenter Server into competition with Unix/PISC systems.

"We're trying to get customers to pause: 'Do I do that on Unix or Windows 2000? [Windows 2000] is less than half the cost,'" Johnson says.

Some analysts are seeing differences in the way Unisys and Compaq are marketing the machines.

"In a canny move, the two companies are positioning the boxes toward different purposes," analyst David Pendery recently wrote in an Illuminata Inc. (www.illuminata.com) research report on the Unisys-Compaq deal. "Unisys sees the partitionable ES7000 as a server-consolidation platform, with multiple four- and eight-ways often running separately or clustered together in the same chassis. Compaq will focus the 32-way ProLiant as a database/decision support/data mining titan -- an Intel alternative to Sun's UE10000 or IBM's S80."

In January, Unisys landed its first customer for a fully loaded 32-processor ES7000 -- Penn National Insurance, which is also a Microsoft reference customer. The Penn National sale squarely fits in the server consolidation model rather than the performance decision support model.

Penn National is looking to consolidate the management of more than 60 servers with its move to an ES7000. Unisys will provide Penn National with consulting services for consolidation as well as four- and eight-way servers that Penn National will use before the ES7000 ships. Tom Miele, director of infrastructure at Penn National, says the company is looking at bringing the terminal services, Web servers, application servers, and database servers into or near the single chassis, although plans are preliminary at this stage.

"We have a lot of servers," Miele says. "Some of them are aging. We have to deal with managing these things. It was starting to become unmanageagable. We needed to have some consolidation and have a server that could handle more than one application."

Marketing Plan

Unisys will push its 32-processor-capable ES7000 onto the market in four ways:

* Direct sales to Unisys' 1,000 top accounts

* Sales by resellers capable of delivering mission-critical apps

* OEM sales through other vendors, such as Compaq and ICL

* Piggybacking on Microsoft and Intel marketing efforts