Enterprise Unix Roundup: Updating iSeries
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For a while now, IBM's iSeries line of midrange servers has been its underachiever. Revenue numbers for 2004 support this: In 2004, iSeries sales were down 27 percent compared to 2003. In the same period, iSeries operating system software (i.e., i5, OS/400, V5R2, Windows, Linux, and AIX-5L) declined 6 percent in line with related hardware volumes.
On Friday, Big Blue announced its heavily Unix-based iSeries will be getting a shot of caffeine with a $1 billion increase to its partner program. With the eServer iSeries Initiative for Innovation program, Big Blue is lobbying its current partner constituency to increase development efforts for iSeries. More resources will be available to the 2,500 ISVs and others that develop for the iSeries platform. It is also looking to add more partners. The company estimates partners will receive $50,000 to $70,000 worth of incremental services. This includes go-to-market support, which in some cases IBM will supplement up to 70 percent, Doug Fulmer an iSeries sales executive told Roundup.
Fulmer said Big Blue launched this program to provide enterprises with the "modern things" they require to move away from their "green screen" environment. Projects currently in the works include RFID, GUI portlets on the front end, and .NET rewrites.
IBM has also upped the management ante behind the iSeries, naming Mark Shearer general manager for the line. Shearer, formerly vice president, IBM Systems Group, was key in helping revive the zSeries line. Presumably, he will be able to rally the troops with similar gusto.
We do not believe Big Blue's iSeries woes are indicative of a big-picture problem for the company, as the numbers illustrate.
We do not believe Big Blue's iSeries woes are indicative of a big-picture problem for the company, as the numbers illustrate. IBM has its eggs, even its Unix ones, distributed across many baskets. Gartner's quarterly server stats, which were released on Thursday, are evidence of this. IBM took the No. 1 spot for the quarter for worldwide Unix revenue, with $1.34 billion in sales, and the No. 3 spot for full-year revenue, with $4.3 billion. In both cases, IBM was the only vendor to see positive growth.
Sun and HP took the two top spots with sales of $5.3 billion and $4 billion, respectively. Year-over-year, growth declined 7.8 percent for HP and 5.3 percent for Sun.
IDC's numbers paint a similar picture, with IBM surpassing HP and Sun to take the largest piece of of the Unix revenue pie in 4Q04 36.3 percent. This a 3.5 point year-over-year gain. HP's share went down 2.8 points year-over-year to 27.6 percent, and Sun's went down 2.2 points to 25.3 percent.
And these numbers take into account the faltering iSeries line. So, clearly Big Blue's overall Unix strategy is effective. If iSeries can be revived and migrations reduced, its basket contents may be ready for some reshuffling.
Looking beyond IBM, if HP and, particularly, Sun, whose bread and butter comes from the Unix space, wish to retain share, they must find ways to make their platform attractive to customers. We've said it before, and we'll say it again: Operating system growth isn't so much about the operating system itself as it about the available tools and applications that support it.
» Depending on how you read the trade press, Novell either "disappointed," "wobbled," or "saw healthy sales" in the first quarter of its 2005 fiscal year.
Profits were largely flat once a hefty Microsoft settlement was removed, so we'll take Novell CEO Jack Messman's word when he says "We still have work ahead of us as we continue to reposition the company in our growth markets." The company moved 21,000 subscriptions to SUSE Linux during first quarter. Compare and contrast that with Red Hat, which claimed more than 130,000 subscriptions in its most recent report.
We've also talked plenty about Novell's new Linux game. Roundup's Tipmeister Carla Schroder has taken a closer look at its offerings and wonders if the company isn't, finally, producing a Linux grown-ups can love.
» About nine months ago we observed the end-of-life of Red Hat 9, a moment widely perceived to be a definitive break between Red Hat and the grassroots Linux community. Red Hat stayed in the "community" game with the Fedora project, but the relationship between the distributor and its developer community has been, as we noted last year, strained. Red Hat has its Enterprise line of distributions to sell, after all. So when its marketing people seemed to be pushing interested parties away from Fedora it made good business sense, even if it rankled those working on Fedora.
Now the company says it may have gone too far. Late last week in Boston, Red Hat's Michael Tiemann said the vendor's behavior "insulted some of our best supporters. But worse, we lost our opportunity to do customer-driven innovation."
The company says it's going to up its support of Fedora, which it's willing to admit has some uses besides as a sop to Linux advocate sensibilities.
Looks like an old master relearned from a newcomer.
» Sun pulled several stories out a mixed bag of news over the past week. It announced the Enterprise 2900, 4900, 6900, 20000, and 25000 servers, all of which run Solaris 10 on UltraSPARC IV. It also confirmed its Trusted Solaris operating system will ship later this year.
On the "bad news" side of things, the company confirmed it laid off additional workers, bringing its total personnel cuts to 3,600 since last year. The company wouldn't confirm which departments were affected, but independent reports say its operating system and software groups were hit the hardest.
» As long as there's a Linux, it will continue to sprout more variants than its commercially controlled cousins in the Unix world. But that doesn't mean the commercial Linux players couldn't stand to settle down a little more. One sign of this is the merger agreement between Mandrakesoft and Conectiva, announced Thursday. With Novell making such a strong play for share in a market that used to boil down to "Red Hat, with the remaining 25 percent or 30 percent left to a pack of small-fries," it makes sense that the two companies would find a use for each other.
Both have survived well into the post-boom world by carving out niches: Mandrake is increasingly addressing SMBs and developing nations along with its traditional desktop emphasis, and Conectiva has held on in Central and South America with heavily localized software and support.
It's probably not a partnership that will strike fear in Red Hat or Novell, but it is one that may enable a pair of survivors to stay in the game.