IBM fights for position in Unix market

While it doesn't have the certainty of death and taxes, it's a pretty safe bet that as long as there's a Unix market, IBM will be a major player in that market. But, as the Unix server market consolidates over the next five years, some analysts question whether Big Blue will be the leader in that market.

George Weiss, an analyst with the Gartner Group of Stamford, Conn., foresees consolidation in the Unix server market within five years with just a few major players. "If vendors are asleep at the wheel, they will lose momentum rapidly," he said, adding that he sees IBM being positioned to be one of the top three sellers.

But, not necessarily the top--hence, the reason for IBM investing millions of dollars into slick ad campaigns that promote its Unix servers. IBM is fighting for its place in the very lucrative Unix server market.

Aberdeen analyst Bill Claybrook says IBM can't afford to lose its piece of that pie. " The Unix server market is a hugely important market for IBM. The S/390 market is flat at best and the AS/400 market is sort of flat too."

IBM has made no secret about the fact that they are aggressively trying to oust Sun from that first place position. The company's ad campaigns are direct attacks at Sun's market.

While the ad campaign does little for the AS/400 and S/390 it could, in fact, help to promote Unix systems as the hip new servers.

Despite predictions that Windows would crush Unix, Unix-based systems are still in great demand. The overall Unix server market grew 11% from $5.9 billion during the first quarter of last year compared to $6 .6 billion during the same period this year according to International Data Corp of Framingham, Mass.

Sun had 32% of the market during that time, while Hewlett-Packard had 26% and IBM had 17%. But IBM captured the lead for midrange systems with such products as the AS/400, taking 25% of the market compared to Sun's 21%.

Regardless of what may be a very successful ad campaign, some industry experts question whether IBM has the product line to garner the market.

In general, IBM offers a wide spectrum of Unix server products, Weiss said. The line ranges from the lower-end Netfinity server running Linux, Unix's open source cousin, to the RS/6000, a server that uses the company's new copper technology microchip running AIX, IBM's version of Unix.

IBM has made no secret about the fact that they are aggressively trying to oust Sun from that first place position. The company's ad campaigns are direct attacks at Sun's market.

Last year, IBM smoked Sun in sales of high-end Unix servers during the fourth quarter selling 720 new RS/6000 S80 servers Sun which moved 255 E10000 servers.

However, both Sun and HP plan improvements to their Unix server lines. Big Blue also plans to upgrade the S80 with faster chips using silicon on insulator technology later this year. Last spring, it introduced three lower-end Unix server lines.

Claybrook saw some internal changes at IBM when he recently visited the officials working on Unix and Linux servers. "Everyone there was under 35, including a vice president, and were very Internet conscious," said Claybrook, who is helping IBM write a white paper on Linux.

IBM is also looking to encourage using Linux, on its hardware as a development platform for software. Generally, if a program is written with Solaris, Sun's Unix-based program, for example, , then customers figure it would run best on a Sun server. So, by encouraging developers to use their hardware for development could translate into future sales, Claybrook said.

Critics have often taken IBM to task for offering four or five platforms and as many operating systems. Yet when it comes to its Unix servers, hardware is matched with corresponding software giving prospective customers a neat package, Claybrook said.

If you have comments about this story, e-mail Ed Hurley, assistant news editor

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