SGI adds hardware guarantee

Silicon Graphics says that if its servers and other technology do not do the job promised, customers get more for free.

Michael Kanellos Staff Writer, CNET News.com
Michael Kanellos is editor at large at CNET News.com, where he covers hardware, research and development, start-ups and the tech industry overseas.
Michael Kanellos
2 min read
Bolstering its Internet strategy, Silicon Graphics has added a guarantee that if its hardware doesn't do the job SGI consultants say it will, customers get more for free.

The guarantee, for customers who implement an SGI technology solution that its consultants recommend, comes as an outgrowth of a renewed SGI emphasis on professional services.

It works in a fairly straightforward fashion. When SGI helps customers design their networks, the company will agree to meet or deliver certain capabilities. If the solution falls short, SGI will provide additional hardware or software for free to meet the goals.

"If we promise a million mailboxes, then deliver 700,000, then it is our financial responsibility to put up more servers," said SGI CEO Rick Belluzzo. "We are so confident in what we're doing that we believe we can make that guarantee.

"You don't have to worry about this infrastructure--you don't have to buy the servers, you can buy capacity," he added.

Belluzzo's guarantee is part of a refocused SGI Internet strategy, targeting ISPs and high-volume Web content sites, that includes working with software vendors to optimize applications for SGI hardware. ISPs have been steadily gaining access and influence over corporate networks. As a result, hardware companies have increasingly stepped up their attempts to serve them with new programs and products.

SGI's new services focus on the endorsement of a key software partner, Software.com.

"Not many people take a solutions focus," said Software.com's CEO John McFarlane, whose firm sells email software to ISPs. "SGI is probably the furthest ahead for services."

SGI says its guarantee is the first of its kind, but hardware vendors and service providers have increasingly used performance guarantees in their sales pitches to large corporations. Cambridge Technology Partners, a system integrator in Cambridge, Massachusetts, is often credited as one of the companies that got the ball rolling in this direction.

Founded in 1991, the company became one of the first integrators to strongly promote "fixed price-fixed time" pricing on consulting projects.

More recently, Hewlett-Packard and others have offered server uptime guarantees of 99 percent plus. Under HP's programs, HP will guarantee, under certain circumstances, that a server will be down less than one percent of the time it remains active. Unlike the SGI program, however, this guarantee depends by definition on surprise operational failures.

Belluzzo pitched ISPs on the performance of SGI's hardware, saying they can support twice as many subscribers per machine compared to other hardware vendors.