But Wait, There's More

• Intel this week ramped up the clock speed once again on its "Prestonia" Pentium 4 Xeon DP processors for entry servers. Like other recent additions to the Xeon DP line, this Prestonia chip has 1 MB of on-chip L2 cache and a 533 MHz frontside bus. The new Prestonia chip runs at 3.2 GHz and costs $851 in 1,000 unit quantities. The prior top dog in the Prestonia line ran at 3.06 GHz and cost $690 per 1,000 ordered. That extra $161 (an increase of 23 percent) only buys you a theoretical maximum of an extra 5 percent performance, and probably comes to less than that on real-world applications. While more is usually better, in this case buying the 3.2 GHz chip is probably not worth the money for most customers.
  
  

• Intel and IBM announced a broad partnership earlier this year that would see the two companies cooperate on blade server designs. Intel has recently announced that it would be selling a variant of IBM's BladeCenter chassis, which packs 14 two-way Pentium 4 Xeon DP processors, a network backplane and switches to connect to SANs and other devices into a 7U form factor. Intel is slightly repacking these machines and will sell them as the white-box Enterprise Blade Server. Intel plans to release an Itanium-based blade for these machines--something IBM has not committed to doing for its own BladeCenter customers. Intel has also tapped storage and file system software expert VERITAS as the supplier of provisioning software for its blade boxes, which will use a variant of the VERITAS OpForce, to be called Intel Deployment Manager. IBM has its own IBM Director software to perform similar tasks on its own BladeCenters. It is curious that IBM and Intel didn't partner on the software as well, but it could be that IBM thinks the real differentiation in blade servers will be the software, not the hardware.
  
  
• IBM has been using the services of a small, privately held company called Sector7 to help it port applications running on HP 3000 and other platforms to the iSeries. As soon as Hewlett-Packard announced that it was sunsetting its proprietary HP 3000 servers, IBM partnered with Sector7, which was founded in the United Kingdom in 1985 and which moved to Austin, Texas, in 1989, to try to drive HP's customers and software partners to the iSeries. How well that strategy worked is unclear, but last week IBM acquired a majority of Sector7's assets and intellectual property for an undisclosed sum. IBM plans to hire Sector7's employees and put them to work in its Global Services leviathan doing porting projects, particularly to Linux. It is unclear if IBM will continue to emphasize porting to the iSeries from other platforms.
  
  
• CRM software maker Siebel Systems, which has IBM as its biggest customer, is taking a second stab at launching a hosted CRM solution for companies who do not want to buy and run their own implementations of Siebel CRM applications but who nonetheless want or need the software. Siebel killed a similar product just about two years ago before it came to market, when the bloom was off the rose on the application service provider model and Siebel wanted to focus on selling its core software. With Salesforce.com and a number of other players proving every day that Siebel should have been more patient concerning hosted CRM, Siebel and IBM last week launched Siebel CRM OnDemand, a joint venture that will sell a hosted version of Siebel's eponymous CRM applications for $70 per user, per month. The deal is a multiyear joint development, sales, marketing, and services agreement. Exactly how much money each party is investing in the partnership is not yet known. The partnership will be governed by Mike Lawrie, IBM's senior vice president in charge of global sales and distribution; Tom Siebel, CEO of the company that bears his name; David Schmaier, executive vice president at Siebel; and Doug Elix, IBM's senior vice president in charge of Global Services. Neither company announced what platforms the service would run on, but odds favor Windows, where Siebel is the strongest. But IBM and Siebel could be choosing pSeries Unix platforms, which have better on-demand features.
  
  
• Late last week, Microsoft was reportedly sued by a single user who was angered by having her identity stolen through a security breach on her Windows machine, and now the case might be snowballing into a giant class-action lawsuit. The lawyer behind the suit, which was filed in Los Angeles Superior Court, is expected to try to push to get class status for the case, which hinges on California's consumer protection laws and is going after the restrictive licensing agreements that Microsoft has for its software. The plaintiff in the suit contends that Microsoft's security alerts are too hard to understand and do more to help hackers than to protect consumers. One of the California laws being brought to bear in this case concerns the protection of consumer information. It will be interesting to see if this law, which was aimed at forcing companies with insecure networks to face the consequences if they let personal information get hacked. Whether this law can be applied to operating system and application software providers is unclear, but it looks like we are about to find out. Many people are now coming to realize that the homogenization of the desktop, which is 95 percent Windows, makes Windows a big national security risk. If Linux had anything close to 25 to 50 percent penetration on desktops, it would be getting hammered by hackers, too.
  
  
• According to a report by market researchers at IDC, IBM gained more than five points of market share in the worldwide IT outsourcing market, widening the gap between itself and rival Electronic Data Systems considerably. IBM ended 2002 with a 22.4 percent share of the $68.5 billion worldwide outsourcing market. However, IBM's gains might be as much from bookkeeping tricks as from generating new business, according to comments made by IDC analyst David Tapper in the Wall Street Journal. EDS saw its share of the market grow from 12.1 percent in 2001 to 16.2 percent in 2002. Computer Sciences Corp., which has been in the IT outsourcing racket since 1958 (when there were only 4,000 computers in the world) was ranked third, with 5.6 percent of the market, dropping more than three points a share. Fujitsu and Hewlett-Packard were respectively ranked fourth and fifth for 2002, according to IDC, with 4.7 percent and 1.8 percent of the worldwide outsourcing market respectively.
  
  

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