Sun Microsystems Launches High-End Intel-Compatible Servers

Strategic Insights -

In a move to revamp its business strategy and compete with industry leaders, Sun Microsystems on Tuesday plans to launch three new Intel-compatible servers. This marks the company's first major product launch since Jonathan Schwartz took over as CEO in April and is seen as a bold attempt to make a mark in the x86 space. The new servers, designed by co-founder Andy Bechtolsheim, are aimed at the high-end market, touting advanced features and capabilities that are expected to help the company fetch a premium in a crowded market.

Key Takeaways:

  • Sun is launching three new Intel-compatible servers, including a standard rack-mounted server, a new blade server, and a data server with built-in data storage.
  • The Sun Fire X4600 is an eight-chip x86 system, making it more powerful than most x86 systems, while IBM's similar system makes up less than 1% of total server shipments and 1.4% of sales.
  • Sun is making a comeback in the blade server market with the Sun Blade 8000, which is designed to improve airflow for easy cooling and is bigger than HP's recent launch, but does not skip on power or network bandwidth.
  • Blade server sales will rise from $3.1 billion this year to $9.6 billion in 2009, with IBM holding the No. 1 spot with 40.1% market share and HP close behind with 35.6%.
  • The Sun Fire X4500 combines a four-chip x86 server and up to 24 terabytes of on-board data, making it easier to store, search for, and retrieve data, especially for data that are hard to index, such as video.
  • Sun's x86 systems are still a small fraction of its overall server sales, but have posted double-digit growth in recent periods.
  • Sun's new product launch is seen as an attempt to prove its viability in the x86 market and to offset news of delays in high-end systems based on its latest UltraSparc chips.

Statistics:

  • Blade server sales will rise from $3.1 billion this year to $9.6 billion in 2009. (Source: IDC)
  • IBM has a 40.1% market share in blade servers, followed by HP with 35.6%. (Source: IDC)
  • Sun's x86 sales were a factor in its first-quarter market share gains, as reported by research firm Gartner, with Sun's server market share rising nearly a point to 10.8%. (Source: Gartner)
  • Sun's revenue from x86 sales has contributed to the company's growth in the x86 market. (Source: Various)

Sources:

  • Sun Microsystems' press release announcing the launch of its new Intel-compatible servers
  • IDC's research report on the blade server market
  • Gartner's report on the server market share
  • Interviews with Sun executives, including Andy Bechtolsheim and Jonathan Schwartz
  • Various news articles and reports on Sun Microsystems and the x86 market