InformationWeek

What's NT's Real Value?

Microsoft wants to prove that Windows NT is scalable enough for the challenges of enterprise computing. Some users already like what they see.

By Stuart J. Johnston
Issue date: May 19, 1997

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For Microsoft, May 20 is the day the company hopes to prove once and for all that Windows NT is scalable enough to take on the toughest of enterprise computing challenges.

But even before the hoopla of Microsoft's Scalability Day in New York, some intrepid corporate customers are already putting the operating system through the paces for business-critical applications. Confidence is building among these users as they leverage NT's price/performance, ease of management, and other advantages to gain an edge on competitors. In fact, these users are beginning to depend on NT for most major application categories except heavy-duty transaction processing.

Dayton Hudson Corp., for one, is considering moving its 1.3-terabyte data warehouse from a Unix system to clustered NT systems. "We have a big commitment to NT in a lot of areas," says Mike Thyken, director of technical s ervices for the Minneapolis retailer. The company still has a wait-and-see attitude, but Thyken estimates that porting its huge database to NT could cut its hardware and software costs by two-thirds. Tandem Computers Inc. last week demonstrated Dayton Hudson's data warehouse on a cluster of 16 four-processor NT servers using Tandem's NonStop architecture.

Dayton Hudson has already committed to deploying NT systems for labor scheduling, store restocking, and other applications in all 1,100 of its stores over the next few years, says Thyken. "It's enterprisewide and mission-critical stuff," he says.

Judd's Inc., a magazine printer in Strasburg, Va., has converted its entire operation to NT. Previously, Judd's used Unix-based servers for manufacturing resource planning and an AS/400 system for accounting, but it couldn't pass up the price/performance advantages of NT, says Richard Warren, the company's VP of IS. Judd's has 4.5 terabytes of images stored on its NT-based jukebox and tape libraries; it's i n the process of doubling that. "With NT, I can deploy for everything the company does," Warren says.

"It used to be a classic divide-and-conquer situation, and it was IS being conquered."

Judd's now can implement sophisticated new business applications under one NT-based enterprise. This month, for example, Judd's shifted its production process for Life magazine to a fully automated, computer-based format and has cut out costly and time-consuming paper-based production stages.

Microsoft and its enterprise partners have already achieved some important milestones in providing the kind of scalability-as well as the middleware and database technologies-needed for critical enterprise applications.

For resource planning, manufacturing, and other enterprise applications, NT is making headway. Texaco Inc., which runs SAP R/3 for 800 users throughout the organization, finds NT to be 25% less expensive than Unix because the application software is cheaper and NT costs less to maintain. "The only neg ative is that it won't stay up as well as Unix, but that's 98% vs. 98.5%," says Gary Richardson, director of IT services at Texaco Star Enterprise in Houston. "Is that much uptime worth the difference in price?"

Pennzoil Co. also runs R/3 on NT. "It's right for us, and it's cheaper for us," says Britt Mayo, director of IT for the Houston oil company. "For us, the Unix alternative was considerably more expensive. For intensive, huge number-crunching computing, Unix still has the edge. But otherwise you can comfortably run your business on NT now."

Pennzoil has 400 users of R/3 financial and manufacturing components and plans to greatly expand that base next year when it rolls out R/3 human resources and payroll applications.

All the big ERP vendors say the fastest-growing part of their business is on the NT platform. SAP rival Baan Co. says about half of its midsized customers and about 30% of its major corporate accounts run their applications on NT. SAP saysmore than 40% of new licenses shipped this year are on NT-up from 20% last year. PeopleSoft last week declared NT and Microsoft SQL Server as the company's primary development platform, and Oracle announced that its Oracle Applications suite of enterprise business software is shipping on NT and includes support for Oracle's clustering technologies.

Eddie Bauer Inc., a retailer of outdoor apparel in Microsoft's backyard of Redmond, Wash., found big improvements in throughput and reliability when it switched from a Novell NetWare server to an NT server for its catalog planning system, says Mark Gransee, VP of IS.

About 2 million records are updated each night. Gransee says the record updates on the Novell server took 20 hours. But on the NT server they take just four hours: NT processes the data on the server, whereas NetWare pushed the processing out to the desktop.

Gransee is adding a second NT server to handle an additional 100 retail planners. A pilot is also under way with a neural-network forecasting tool to aid planners in decid ing what fashions to ship to the company's 450 retail stores.

E-Commerce
Business Travel Solutions, a unit launched last fall by Sabre Travel Information Network, depends on NT to connect corporate travel offices or agencies with the Sabre computer reservation system for airline, car rental, and hotel reservations. Business Travel Solutions also integrates with the corporate customer's accounting and travel-expense systems, says chief technology officer Eric Garcia. Users such as Charles Schwab and General Electric access Business Travel Solutions via dedicated lines on four Digital Equipment Alpha Server 4100s at the Sabre service bureau. Response time is four seconds-the same as with the mainframe computer that runs Sabre's computer reservation system. "We are comfortable with the architecture, which has operated at 95% availability since it started," Garcia says.

Still, NT has a long way to go to support heavy-duty transaction processing applications, says Dan Kusnetzky, an analyst with International Data Corp. in Framingham, Mass. That's partly because Microsoft didn't begin shipping the first version of its Transaction Server until January, while its store-and-forward middleware, Microsoft Message Queue, and its Wolfpack clustering technology are still in testing. A more scalable version of SQL Server is still under development.

Some vendors say they already offer what it takes to make good on Bill Gates' promise of 1 billion transactions a day ( IW, April 7, p. 14 ). In a recent demonstration, IBM cranked out a billion transactions on its DB/2 database on 114 clustered NT servers in just 19 hours.

But it's uncertain when that kind of high-end performance will play out in real-life scenarios. "We can't expect to see the level of maturity we need [with NT] until the turn

of the century," says Joseph Kubat, a senior VP at the Securities Industry Automation Corp. (SIAC), the automation arm of the New York and American stock exchanges. "There are qu ite a few applications that can be offline for a half-hour, but that's not true on the trading floor."

SIAC has had some critical systems, such as the message switch it uses to communicate with member firms, running at 100% reliability for a year or more. Its general goal is 99.99% uptime.

Delta Air Lines won't touch NT at the enterprise level for three to five years, says Louis Marbel, director of enterprise product development at TransQuest Inc., the airline's IS unit. But Marbel says NT is the standard for Delta's desktops and low-end servers, where downtime would have a minimal impact on the business. But Delta will continue to use Unix systems as high-end servers for more critical transaction processing functions. Marbel sees nothing in the market that can replace the IBM mainframes it uses for applications that require massive amounts of high-speed data transfers.

Easier To Manage
Still, NT across the enterprise is Delta's goal, Marbel says, because of its simplicity. NT is easie r to manage, reducing support costs and increasing application-development productivity, he says. "As NT becomes more stable, with additional products to run the enterprise, we hope that NT will eventually migrate all the way to the enterprise level," Marbel says.

At the World Bank in Washington, NT is fine as the platform for an intranet-based cash information system that gives the status of payments or receipts-but not for the financial transactions themselves. "We're looking forward to the clustering capabilities of NT, but more of our critical stuff won't move over until those features are available and proven," says Norman DeGennaro, the bank's information officer.

Microsoft is getting closer. A recent demonstation performed by Prologic Corp., a retail banking software firm in Vancouver, British Columbia, claimed NT can run a bank with 2,000 branches, 10,000 employees, and 9 million customers, and can process 3 million customer transactions a day. The benchmark was conducted in conjunction with Compaq, EDS, and Microsoft.

Some banks get good performance from NT, but not overwhelmingly good. Capital City Savings & Credit Union Ltd. in Edmonton, Alberta, is rolling out Prologic's Ovation software on NT. The complete deployment will automate the bank's 19 branches, as well as its automated teller machines, telephone, and Internet banking systems. Still, that will handle only 20,000 to 40,000 transactions per day. Ultimately, "we'll save about $3 million over five years on operating costs by going to the NT solution," says George Irwin, Capital City Savings' VP of IT.

Another area where corporate users see NT scaling: the intranet. Eddie Bauer has NT on the desktop, uses an NT server to host its Web site, and three months ago began an intranet test on an NT server. "We had one toe in the water with NT. Now we're jumping in with both feet," IS VP Gransee says. "The intranet pilot will start getting NT into more of the enterprise world."

Similarly, the National Association of Securities De alers is planning to migrate from Sun Solaris Unix to NT for its intranet and several public Web sites over the next year. NT servers support NASD's massive Internet site, used for investor purposes, but more will be added to support a media and market data Net service planned for this summer. By the fall, an Oracle database on NASD traders and brokers will move from its current home on a Sun Solaris Unix Web server to an NT server, providing online database access and search capabilities. And by early next year, the two Sun Solaris Web servers for NASD's intranet will be switched to NT servers. Two existing NT servers currently keep statistics on Web site hits and replace paperwork within the organization by supporting database activities.

While it's clear that some users are already convinced of NT's ability to move up in the enterprise, NT will continue to suffer from the perception that it is "immature, new, and unstable for high-end applications," says Tom Rhinelander, an analyst at Forrester Researc h in Boston. Until impressive demonstrations are turned into real-world applications, "The question is," he says. "will IT do it?"

Martin J. Garvey , Bruce Caldwell , Tom Stein , Clinton Wilder , Jeff Angus , and Marianne Kolbasuk McGee

See related story: " Vendors Rush To Stand On The NT Platform "

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