HP chief executive Carly Fiorina is expected to announce a 32-processor version of Superdome tomorrow in New York, but much of the industry's attention will be focused on a 64-processor version that HP hopes to release later this year.
HP is expected to wrap Superdome itself with a host of "e-services" intended to catch the attention of customers who want to stitch together business operations housed on different servers.
With Superdome, HP hopes to steal away some of the momentum of Sun Microsystems--which in recent years stole HP's crown as the top Unix server seller--and to stave off the growing presence of IBM. Though Sun is having no trouble selling its Unix servers, including its 4-year-old, top-of-the-line E10000 "Starfire" machine, analysts see some vulnerability because of delays of new servers and memory problems in current models.
But HP faces doubts, too, with financial analysts' concerns about its Unix server business sending shares down. Last year, Fiorina took the offensive on the Unix server business, reorganizing the sales force, lashing back at the jabs of Sun CEO Scott McNealy, and arguing that the fortunes of HP don't hinge just on its Unix servers.
"This is a very, very important announcement for HP. They've really got to hit a home run and start to close that gap" with Sun, said International Data Corp. analyst Jean Bozman. "Part of the reason HP may have experienced that decline in the previously concluded quarter was that people were anticipating this big bump in processor power."
But the issue isn't just the prestige and profit margin of a high-end server.
"The revenue and margins on the products are pretty good," said Illuminata analyst Jonathan Eunice. But more important, Eunice said, is that "if you sell something of that class, you can sell a lot of gear behind that."
Unix servers once were consigned to the dustbin of history by the rising fortunes of Microsoft's Windows operating system and the low price tags of computers based on Intel chips. But while Microsoft and Intel were struggling with the difficulties associated with moving into high-end, powerful systems, the Internet arrived, and traditional server companies using the Unix operating system and RISC chips stepped in to fill the need for million-dollar systems.
Customers for these servers are typically large businesses whose huge databases must keep track of corporate accounting, the buying preferences of thousands of customers, or the location of millions of parts in a manufacturing complex. Although Internet companies such as HP customer Amazon.com need major amounts of computing power to handle requests from thousands of people across the Internet, more conventional corporations have huge demands of their own when thousands of employees are using the systems.
According to IDC, Sun has the largest market share for Unix servers. In the first quarter of 2000, Sun had 32 percent of the revenue, with HP following at 26 percent and IBM at 21 percent.
"You have to be competitive," Bozman said. "Back in 1998, Sun began to pull away. It was notable Sun was able to keep growing in 1999, whereas HP and IBM experienced a slowdown."
Last year, the Unix server market generated $25.6 billion in sales, IDC said.
Computer sellers have caught on to the importance of the Unix server market, with multimillion-dollar advertising budgets and new systems from all the companies. Compaq has released its 32-processor "Wildfire" GS320; IBM is upgrading its 24-processor "Condor" S80; SGI has released its 512-processor "SN-1" Origin 3000; and Sun is about to release its upcoming "Serengeti" series UltraSparc III-based servers, which at least in labs use more than 100 processors.
The vast majority of customers, though, don't purchase systems that aren't loaded to their maximum CPU count, Eunice said.
Superdome details emerge
Details are starting to emerge on Superdome, even though the product has yet to launch.
Superdome previously was code-named "Halfdome" after the famed granite peak in Yosemite. But marketing personnel, worried about perception problems of a product whose code name begins with "half," requested a more superlative prefix, Eunice said.
On a more substantive level, the computer will consist of four-processor building blocks, each with its own memory and input-output hardware for tasks such as communicating with the network, sources said. Using two high-speed switches, eight of these building blocks can be assembled into a 32-processor configuration.
Then, using a two-cable "Flex" system, two of these 32-processor blocks can be joined into the full-fledged 64-processor Superdome scheduled to arrive later, a source familiar with the product said.
In addition, Superdome will follow in the footsteps of its predecessor, the V-class servers, which could be grouped together in foursomes. Though the latest version of HP's version of Unix, HP-UX, can run on as many as 256 CPUs, Eunice said the four-computer gang approach is of interest chiefly to the relatively small market of technical computing customers who need the systems to perform mathematical calculations.
HP has been open about the fact that Superdome will accommodate both its own PA-RISC chips and, later, the IA-64 line co-designed by Intel and HP. Servers from Sun, Compaq and IBM don't have this dual-processor path, but SGI's new Origin 3000 does.
Sun has the top sales in this crowded market, but it's having its own share of problems.
The brains of the new Sun top-end products, the UltraSparc III "Cheetah" chip, were originally due at the end of 1999, and Sun's current servers have been suffering from memory problems that cause the machines to unexpectedly restart.
Sun spokesman Doug van Aman confirmed the memory problems, which surfaced in analyst reports from Gartner and Meta Group. The problems first were noticed in high-end E10000 servers but have been observed in other models as well, including the E4500 and E6500.
The problem was that under some circumstances, ones and zeros stored in high-speed "cache" memory could change state, causing the computer to unexpectedly reboot, van Aman said.
Sometimes the problem was ameliorated by lowering the temperature of the server environment, but the problem still happened more often than specifications should have permitted.
Sun has released "scrubber software" that that helps compensate for the problem, the company said.
The problems have hurt Sun's reputation, but the company's popularity and marketing power mean it will be able to weather the storm, Eunice said.
Sun's replacement top-end systems aren't due until 2001, though workstations and low-end servers are expected to debut at Sun's "Medici" launch Sept. 27 in New York. All the systems fit in the Serengeti architecture built around the UltraSparc III chip.