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IBM, Sun, and Dell Ship New Blade
Servers
By Charles King
IBM, Sun Microsystems, and Dell have announced the
availability of new blade server solutions. Originally announced in September
2002, the IBM BladeCenter is a Xeon-based dual processor solution that sports
optional features including Fibre Channel and Gigabit Ethernet switches, and
redundant hot swap cooling, power, and management modules. The IBM
BladeCenter supports up to fourteen blades per shelf and eighty-four blades
per rack, and ships with IBM Director, the company’s autonomic systems
management software. Base price for IBM BladeCenter is $1,879 per blade. Sun
Microsystems announced the Netra CP2140 and CP2160 cPCI blades,
NEBS-compliant blade products designed for wireless and other telecom
services. In addition, the company introduced the Netra HA Foundation
Services 2.1 software. The Netra CP2140 and CP2160 both utilize Sun’s
UltraSPARC Iii 650 MHz processor with extended memory configurations, and
offer Hot Swap control and IPMI systems management. The new Netra products
can accommodate up to sixteen processor blades per shelf and forty-eight
blades per rack. The Netra CP2140 is currently shipping starting at $3,995,
while the CP2160 is scheduled to ship in early 2003 priced at $4,395. Dell
announced the availability of its PowerEdge 1655MC, a blade server product
originally announced in March 2002. The 1655MC consists of six dual processor
blades featuring Pentium III processors and SCSI hard drives, and also
features Dell’s Open Manage Remote Install, software the company claims
clients can use to simultaneously tune hundreds of blades. Pricing for the
PowerEdge 1655MC begins at $3,298 for an enclosure and one blade.
Blades are designed to address issues surrounding
server consolidation by increasing server density, reducing hardware
footprints, sharing subsystems such as storage and networking and simplifying
cabling and connectivity. While these are issues dear to the hearts of IT
staff and datacenter managers, how these new products from IBM, Sun and Dell
will resonate in the larger market is unclear. However, we believe that two
of these vendors are focusing their blade strategies by developing products
to fit the needs of specific niches. IBM’s BladeCenter product appears
designed from the get-go to deliver a high-density, high-octane blade-based
solution for a variety of server consolidation needs. The utilization of
Intel’s Xeon processors should offer a significant price/performance
advantage, and IBM’s decision to offer optional Fibre Channel and Gigabit
Ethernet support will allow BladeCenter solutions the flexibility to support
both SAN and NAS environments. Additionally, we expect BladeCenter
deployments to profit from IBM’s Advanced Connectivity Technology (ACT)
solutions for datacenter simplification that the company announced in July.
In a similar vein, Sun’s new NEBS-compliant Netra
CP2140 and CP2160 tip an obvious hat to the company’s core telecom clients, a
group Sun has served for years. The Sun blades do not offer the sheer per
rack density of the IBM BladeCenter (though they match HP’s Proliant BL20p
blade products), but durability rather than density is the primary aim of
carrier-grade solutions. To that end, we see the Netra CP2140 and CP2160 as
simple continuations of a product set and market Sun understands very well.
But while the IBM and Sun blade products appear well-tailored to meet current
and emerging blade demands, the same cannot be said for Dell’s PowerEdge
1655MC. We expect Dell will aggressively push the 1655MC toward its business
customers, but we do not believe they will be especially well served. The
1655MC’s long development time and dependency on Pentium III technology
bespeaks a solution that is already somewhat long in the tooth on the day it
hits the market, which erodes both the 1655MC’s immediate and long term
value. This is hardly the message a vendor wants to send or be hobbled by in
a quickly evolving, cutting edge market like blade servers. While Dell is a dynamic
company that can squeeze every last nickel of profit out of commodity-based
solutions, it has never been known for developing or delivering cutting edge
technologies. From that standpoint, the PowerEdge 1655MC has all the markings
of a “me-too” product by a vendor that wants to convince the market (and
perhaps itself) that it is a serious enterprise player.
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Online Holiday Shopping: e-Tail
Wags the Dog
By Jim Balderston
The U.S. Commerce Department reported that third
quarter online sales in the U.S. rose 34.3% over a similar period last year.
The total amount of online sales for the quarter was $11.06 billion, or 1.3% of total U.S. retail sales for the quarter.
That figure is also up, from 1.1% last year. The report also notes that
online sales rose 7.8% from the second quarter of this year. Various
predictions for the holiday online shopping season are also being batted
about; some predict sales of close to $14 billion for the fourth quarter,
which would be in the neighborhood of 25-30% higher than last year.
There is no doubt that online retail is going
through a boom period. When one considers that brick-and-mortar retailers are
happy with anything above 5% growth in sales over a year period, numbers like
34.3% look very impressive. One comes down to reality when assessing the
actual percentage of total retail sales that online buying comprises. It is
still just a drop in the bucket.
While some folks predict never-ending growth to the
online retail sector, reality argues such huge growth percentages can’t last —
in short, we are seeing the first phase of the law of large numbers playing
out. As time wears on, online retailing will continue to contribute to the
economy but its year-to-year growth rates will slow and eventually come into
line with more traditional retail growth rates. By that time, of course, the
contribution such online sales make to the larger retail total will be
growing as well, an activity well worth watching. All these numbers would
indicate that the e-tailing market is still immature. Another indication of
such immaturity is the reliance on fourth quarter (holiday) sales to make the
year’s revenue that so many online retailers depend on. Looking at Amazon’s
last four quarters, one sees that 30% of its revenue came from Q4 2001.
Surely Q4 2002 will bring in higher gross sales, thereby representing an even
higher percentage of CY 2002 sales. Major brick-and-mortar retailers have
been moving to limit their exposure to fourth quarter downturns by trying to
keep the holiday shopping revenues at something like 20% of the year’s total,
according to the National Retail Federation. Year round discounting and decreased
reliance on a big fourth quarter sales have smoothed the bumps for many of
these larger retailers. Online retailers will eventually be forced to follow
similar strategies, probably about the same time that the dizzying
year-to-year growth figures have fallen more in line with traditional retail
growth ranges. At which point, of course, none of this will make news,
indicating that the revolutionary aspects on online retail have been fully
instantiated on society at large.
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Is Bigger Better? A Second Look at
Data Aggregation
By Jim Balderston
Federal authorities in New York announced this week
that they had broken up an identity theft ring that stole more than $2.7
million from some 30,000 unsuspecting victims in all fifty states. The
identity theft ring centered on Teledata Communications, a company which
provides credit reports to banks and other lending institutions. Three men
have been charged in the case that involved the theft of thousands of credit
reports, which members of the ring used to establish fraudulent accounts
using the names and information of actual people, who were then billed for
thousands of dollars of charges they had never authorized. Authorities said
they expected the dollar amount of the thefts to rise as more victims are
identified. At the center of the ring was a help desk worker at Teledata, who
apparently sold passwords and access codes for the Teledata clients to other
members of the ring for $60 a pop. These pass codes were used to download
credit reports form the nation’s major credit reporting agencies. Authorities
call this the largest case of identity theft on record.
In the Hollywood version of computer crime, it is
usually the efforts of some brilliant hacker with the latest in high-tech
gear that somehow defeats the vast arsenal of security technology arrayed
against his efforts to steal valuable information. This case — among a long
line of similar events — shows that it is rarely the uber-geek
that breaks down the technology; it is instead some hourly wage slave that
decides to go renegade.
Consider the case of Robert Philip Hanssen, the FBI
counter-intelligence agent who managed to steal U.S. intelligence information
for fifteen years under the nose of his co-workers and superiors. One assumes
he went through a more granular vetting process than the help-desk employee
at Teledata.
This leads us back to the federal government’s
proposal to create a massive database of virtually all available information
concerning U.S. citizens in an effort to facilitate better information
correlation as it relates to possible terrorist activities. What both the
Teledata and Hanssen cases illustrate is the fact that the highest levels
security based on technology can easily — and invisibly — be defeated by even
the least technologically skilled individuals. When considering the risks of aggregating
huge amounts of data on average Americans, it makes sense to remember that
maintaining islands of data can have a statutory effect from a security
standpoint. Giving the local sheriff access to the IRS records of his
village’s resident is a scenario ripe for abuse. So it is on the national
level with thousands of government employees maintaining data that access to
would be worth many times their annual salaries. The lesson here should not
be lost on the private sector as well, which may have also fallen into the
trap of putting all data in one place for the sake of efficiency and
transparency. Such value propositions do not come without a price.
Catastrophic security breaches should be accepted as a real possibility, and
one that should be weighed heavily against the highly touted value of pure
efficiency.
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Is PeopleSoft Just Ahead of the Market?
By Myles Suer
Peter Gassner, VP and GM of PeopleSoft Technology,
presented at Comdex this week on “Real-Time Enterprise: The Killer
Application for Web Services.” In this session, Gassner discussed how Web
services are enabling the creation of real-time enterprises. In fact,
PeopleSoft now positions itself as providing software and services for the
real-time enterprise. PeopleSoft has taken this step having delivered
built-in support for Web services based on the existing XML and HTTP
standards. At the same time, much has been written recently regarding the
fact that members of the World Wide Web Consortium (W3C), the group
responsible for creating a Web Services standard, indicate a standard may be
a year or more away. To date, the W3C has only considered the Sun-driven Web
Services Choreography Interface (WSCI) proposal with expected proposals from
IBM and Microsoft still in the offing.
Having participated in industry standards activities
involving some of these same industry titans, we are always amazed at how
long it takes a standard to get confirmed, especially when there are
competing proposals. We can attest these processes are lengthy and always
take longer than expected to get a fully documented and ratified standard.
But once such standards have been accomplished, the issue then becomes having
systems to interconnect. Equally, as important, standards change can cause
the Vanguard to make significant changes to their solutions in order to
comply with the final standard.
Earlier this year, the CTO of PeopleSoft asserted
that PeopleSoft is again in a time of technology change similar to the waves
of client/server and the Internet, which the company had successfully
navigated. For this reason, it is no surprise that PeopleSoft has got its
board waxed and ready to go. However, we believe the deployment and
standardization of Web Services will be a bit different. PeopleSoft is not in
the position to create a de facto standard, as in this day and age there are
simply too many valuable heterogeneous systems needing to be interconnected
such as ERP, CRM, Financials, Supply Chain, and Business Intelligence.
Although PeopleSoft is a player in many of these categories, most customers
do not use a single vendor for everything. The question is: what does
Peoplesoft plan to interconnect with other than its systems? This answer is
not necessarily clear and has a potentially huge impact on the PeopleSoft and
Web Services value proposition. ISVs certainly can take advantage of
PeopleSoft’s decision as well as EAI vendors; however, in terms of real
business advantage it seems the market will need to wait for W3C standard to
be finalized. Given the heterogeneity and complexity of the systems that
logically should be interconnected, it seems that a single vendor will not be
likely to dominate this standards process or necessarily drive it any faster
than another.
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