Dell chases datacenter kudos

Dell computer is known for its build-to-order PCs and even its edge switches. But now the Round Rock, Texas-based computer maker is working up a serious thirst for the datacenter business. While Hewlett-Packard seeks to consolidate its own server business behind the popular ProLiant series, Dell is gaining strength as a formidable, dark-horse hardware competitor.

According to analysts, Dell’s success in industry-standard, Intel-based servers, particularly its PowerEdge server line, is also giving IBM and Sun heart palpitations, as technologists buy into its low-price, high-performance model. But the question HP must deal with is how deep Dell can move into the datacenter with its industry-standard platforms. As it stands, Dell is winning the numbers war. According to Framingham, Mass.-based research company IDC, Dell overtook HP in the first quarter of 2003 to become the No. 1 computer vendor. Dell sold almost 500,000 more units than HP. Those units included Intel-based servers, desktop systems, and notebooks.

“The market has continued to push toward the lower end, and Dell has dominated in that space,” says John Humphreys, senior analyst of server infrastructure at IDC. Intel’s CPU and chip-set technology is giving the Dell servers powerful performance and the ability to support a wide range of applications.

As part of that trend, Dell extended strategic partnerships with Oracle and EMC last month to leverage sales connected to the database and storage markets. Dell’s database-integration partnership with Oracle concerning Oracle9i has been well received by early adopters. Dell is also reaping benefits from its strategic partnership with EMC in the storage realm. And if that’s not enough, Dell’s services unit can also facilitate enterprise integration.

Precision Response, a Fort Lauderdale, Fla.-based provider of outsourced call centers and other CRM services, is watching Dell’s datacenter play closely. Precision Response first deployed PowerEdge 6650 servers in December 2002, each capable of running as many as four Xeon processors with multiprocessing at 1.5GHz, 1.9GHz, or 2.0GHz.

Low cost and scalability rate high as reasons for adopting the architecture, says Bill Hicks, Precision Response’s CIO. “If we have growth in the enterprise, we can buy other PowerEdge servers and cluster them,” Hicks says. “We were running Sun Sparc servers. Now we are saving $18,000 a month.”

Dell said that in conjunction with Oracle it will offer integrated systems that include its servers, Oracle9i database software, and the Linux OS. The strategy will allow customers to move away from proprietary systems, such as Sun’s, and toward Intel-based systems that use Linux or a Microsoft OS.

Precision Response’s Hicks said he will use the system to manage massive amounts of customer data. PowerEdge servers running Oracle9i database with application clusters on Red Hat’s Linux OS will allow the company to save money and maintain flexibility, he said. Hicks also integrated the environment with a Dell/EMC storage network system.

Other users agree. “I’ve looked at HP, but they are rarely in the range of Dell. If I can get the same server for a fraction of what HP is offering, it’s a no-brainer,” says Arturo Castellanos, director of Web Services at GeoPassage, an online travel company based in Austin, Texas.

IDG News Service correspondent Tom Krazit contributed to this report.