But Wait, There's More

Sun Partners to Drive HPC Sales

Last October, Sun Microsystems founded a high performance and technical computing (HPTC) business line to consolidate its efforts across supercomputing, grids, visualization, and other areas. In January, Sun set up an HPTC alliance partner program to help push its vision of grid computing, not to mention its Grid Engine grid middleware and Linux and Solaris servers, in this nascent grid market. Sun recently added 20 new grid partners to the alliance, bringing the total number up to 36, according to Shahin Khan, general manager of Sun's grid business. The new partners include Avaki ClearSpeed Critical Software, DataDirect Networks, DataSynapse, Dot Hill, Engineous, Enigmatec, Exludus, GridIron, GridXper, Level 5 Networks, Meiosys, Paremus, Pathscale, PGI, Scali, StorageTek, Streamline Computing and United Devices.

Many of these players are well known in grid markets, some are yet to become well known. But getting as many partners as possible has always been Sun's go-to-market strategy. But there is more to it. "Our alliances with the grid startups are very important, given the crystal-ball nature of the HPTC market relative to IT in general," explains Khan. The research centers of the world, where big supercomputers and clusters run, are a test bed of new ideas. And it is here where many fail, but a few thrive and go on to change the way we do data processing outside of the technical computing market.

IBM Adds Solaris, Linux Support to SAN File System

When IBM rolled out its "StorageTank" SAN File System, in December 2003, it was not a fully functional, heterogeneous product. However, IBM is promising that, by the end of June, SAN File System 2.1 will fix many of the issues that have been holding back the adoption of the software. StorageTank is a global file system that spans storage area networks and different server and storage architectures. The idea is to aggregate the control and administrative points for file systems and to have a policy-based rules engine for when and where to place data in the SAN such that storage administrators, who wickedly overprovision storage, no longer do this. Overprovisioning, which has been necessary because of the complexity and difficulty of acquiring and setting up storage for servers, costs companies big bucks. Some polls of data centers show that only 25 percent of the storage allocated to applications is actually used.

With SAN File System 1.1, IBM supported its own midrange and high-end disk arrays running in conjunction with its own AIX Unix variant and Microsoft's Windows 2000 Server and Windows 2000 Advanced Server. With the 2.1 update coming out in a month, IBM will support Red Hat's Linux Enterprise Server 3.0 and Sun Microsystems' Solaris 9. Presumably, HP-UX support and Windows 2003 support are in the works. IBM also will support disk arrays made by Hewlett-Packard, EMC, Sun, and others. SAN File System 2.1 costs $10,000 per processor on the central metadata server that acts as the controller for StorageTank, plus $5,000 per processor for each application server linked to the system.

Sun Announces Asia/Pacific Solaris Partners

Like other IT vendors, Sun Microsystems is chasing business in the emerging markets in the Asia/Pacific region, in hopes of catching the new IT wave that is rising in places like China, Singapore, and India. To that end, Sun has been working very hard to get system makers and independent software makers to become Solaris partners. Next week, in Shanghai, where Sun is hosting its SunNetwork event and will be rolling out its next batch of quarterly announcements, Sun is expected to announce a new bunch of Solaris on X86 OEM partners. But last week, Sun made an early announcement on new independent software vendors in the region. In China, Excellence Network, iESLab, Neusoft, Runqian, and UFSoft have committed to support Solaris on X86. In Singapore, EcQuaria, ECnet, and WizVision have partnered with Sun. In India, Jaatayu Software, Lasersoft, and Transversal e Networks have all agreed to support their applications on Solaris for X86.

While none of these companies is a household name in Western economies, they could be in their fast-growing indigenous markets, and by getting as many of these small companies on board as possible, Sun has a good chance of getting back to profitability--and maybe even growth.

HP Inks Big Unix Utility Deal with Gates

Gates has just bought into Hewlett-Packard's Superdome systems and the company's "adaptive enterprise" utility pricing model. Not Bill Gates, of course, but rather Gates Corp., an automotive parts manufacturer that is part of the British conglomerate Tompkins.

HP announced last week that Gates would be upgrading its Oracle Applications ERP suite and moving to a network of two Superdome HP-UX Unix servers, over 300 ProLiant servers, and an HP storage area network based on HP's EVA5000 array with 20 TB of capacity on tap. HP and Gates did not provide specifics for the deal but said it was based on a pay-per-use deal worth millions of dollars. That price includes hardware, software, and services. The deal also includes setting up virtual partitions on the servers and SAN virtualization, both of which are aimed at increasing the utilization of those components and cutting IT costs.

IBM's JS20 Blade Delayed by Memory Issues

IBM said this week that shipments of the two-way PowerPC 970-based JS20 blade servers for its BladeCenter machines will slip from early March to June 11. These Power blades were announced with much fanfare in November 2003, as IBM began to ramp up the marketing machine on its Linux-on-Power strategy.

The reason why the JS20 Power blades didn't ship immediately in November, and why IBM dillydallied throughout the summer of 2003 before announcing them, was as much because it was having chip yield issues and shortages of the PowerPC 970s as it was that the company was not sure what to do with a Power blade. The latest delay, according to our sources at IBM, is not related to problems with the PowerPC 970 processors. The story, so we are told, is that one customer using the new Power blades in an atypically hot environment discovered come issues with memory. Our sources would not be more specific about what exact memory components were affected, but they were adamant in saying that it was not a chip-yield or bug issue. IBM is committed to shipping in volume on June 11, and says further that it has the problem licked and is now spending time going through its rigorous testing processes. For the most part, the delay only affects Linux customers, since AIX support is not slated for the JS20 blades until AIX 5L 5.3 ships in the third quarter, probably in September or October.

Offshoring Grows Quickly in 2004, but Analysts Say It Won't Last

IT analysts at Gartner and Forrester Research released new reports on offshore outsourcing last week that highlight some interesting changes underway in the burgeoning global market for outsourced services. Gartner says offshore business process outsourcing (BPO) of IT-intensive jobs will increase by a whopping 65 percent this year, amounting to $3 billion in spending by the end of this year. Gartner says, however, that the market will not be able to sustain such high revenue increases in the coming years. "Offshore BPO is an emerging, but immature, opportunity," said Robert Brown, principal analyst for Gartner's sourcing group. "There will be slower adoption of offshore BPO through 2007." Meanwhile, Forrester last week bumped up its projections of American job losses over the next 18 months by 40 percent. Forrester originally projected that 588,000 U.S. jobs in the services sector would be outsourced by the end of 2005, but last week the company said new research indicates the figure will be closer to 830,000. Forrester said it bumped up its projections because of accelerating outsourcing activities, which it attributes to recent publicity given to the trend, from new services available from top-tier Indian outsourcing providers, like Satyam Computer Services, Wipro Technologies, and Infosys Technologies Limited, and from a rapid expansion in offshore outsourcing facilities by U.S. vendors IBM and Accenture. Forrester barely boosted its outsourcing projections for the long term. It now says about 3.4 million U.S. services jobs will be lost by 2015, up from its previous estimate of 3.3 million.

ERP Spending to Grow in 2004

The global market for ERP applications is expected to grow by nearly 7 percent this year, according to a new study by IT analyst IDC. The Massachusetts firm said last week that $26.7 billion will be spent on ERP software this year, up from the nearly $25 billion spent in 2003. And by 2008, IDC said, ERP spending will increase by almost 35 percent, to $36 billion. Considering that many people thought ERP was dead, in lieu of the new era of e-business, just a few years ago, this has to be very promising news for ERP vendors. IDC also said market consolidation will continue this year, although it won't produce any jaw-dropping numbers. The top-10 ERP vendors secured 46 percent of the market in 2003, compared with 44.5 percent in 2002 and 42 percent in 2001, IDC said. Though the firm said it released a list of the top-10 ERP vendors, the press release only listed the top five: SAP, PeopleSoft, Oracle, Microsoft, and Sage. IDC had not provided the rest of the top 10 list at press time, so we decided to take a stab at numbers six through 10 ourselves and came up with Geac, with $456 million in fiscal year 2003 revenue, Intentia, with $384 million (2927 million SEK), Lawson Software, with $344 million, IBS, with $315 million (2,400 million SEK), and SSA Global, with $285.4 million. (These revenue figures are for the companies' fiscal 2003 years, which vary and therefore aren't direct comparisons, but this gives you an idea of how the rest of the ERP market shapes up.)