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3/3/2010
08:13 AM
Bob Evans
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Global CIO: IBM Claims Hardware Supremacy And Calls Out HP's Hurd

Touting its $4B hardware R&D investments, IBM says HP is stuck on commodity parts and a supply-chain model.

Although IBM's hardware business has been declining as a percentage of its overall revenue for the past decade, the company's sweeping $4 billion overhaul of its Power7 line and x86 lines underscores its huge commitment to becoming the industry's undisputed hardware leader in innovation, optimized systems, cost of computing, and last but definitely not least, market share.

As part of that effort, IBM is showing the world a much feistier public persona in contrast to its long tradition of low-key positioning and general unwillingness to discuss competitive issues. And while attitude without actual achievements is a fool's game, IBM's investments of three years and $3.2 billion in its new Power7 line and its 5-year, $800 million revamping of its x86 technology have given it a compelling story about how it is outflanking Hewlett-Packard, Dell, Oracle-Sun, and Cisco in the enterprise systems business.

It's a story that IBM Systems and Technology senior vice president Rod Adkins is eager to tell, and in a wide-ranging interview with my colleague Alex Wolfe and me, Adkins laid out the key elements behind IBM's hardware strategy and called out each of those four competitors on their various inabilities to match IBM's technology, investments, and strategy.

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Again, I realize that these days, talk is cheaper than a used Toyota—and that IT vendors need to deliver first and discuss it all later. But IBM and Adkins point to four consecutive quarters of x86 market-share growth for IBM as powerful evidence that CIOs are voting with their wallets, and, looking ahead, issued a list of eye-popping capabilities that its new x86 line, called eX5, can deliver. And before getting to Adkins' perspectives, here's a quick look at some of those numbers:

**IBM claimed to be "the only major server company to see market share gains last year in x86 servers with four consecutive quarters of share gains" that it said came "at the expense of HP and others."

**In the fourth quarter, IBM said, its x86-based server revenue grew 37 percent year over year.

**Its eX5 architecture can cut the cost of running an Oracle environment by 66%, and increase SAP performance by a factor of 3, wrote my colleague Paul McDougall yesterday in his news coverage of the launch.

**"The company said eX5 systems' ultra-efficient memory use affords extreme virtualization that will deliver 30-times better database performance than current systems, 99% better performance-per-watt, and the ability for companies to run 78% more virtual servers for the same licensing cost," McDougall wrote.

So those market-share figures and performance claims provided the backdrop for senior VP Adkins, who took over the leadership of the Systems group just a few months ago, to outline IBM's latest strategy and explain why that matters in today's IT-intensive marketplace.

"We are accelerating our market position through continued innovation" at every point across the stack, Adkins said. "It's what I call intelligent performance versus raw performance. We can definitely scale the technology to get the raw performance, but given the complexity of today's IT infrastructure environments, IT managers also need to see improvement and simplification in how they manage that environment: virtualization, consolidation, systems management, and workload optimization.

"So we're gonna continue to drive the thinking about Moore's law but at the same time we're going to build in those things that give CIOs a better way to simplify, manage, automate, and get energy optimization." (In an upcoming "Server Den" column, my colleague Alex Wolfe will go into more detail on this and analyze IBM's technology strategy.)

Adkins spoke repeatedly about the need to deliver greater value to CIOs via three approaches—innovation, integration, and optimization—and also said IBM is looking to deliver immediate efficiencies (as the bullet points above detail) as well as future groundwork to meet the need for predictive analytics to manage the oncoming explosion in data from the one trillion intelligent devices that IBM predicts will be embedded in our world by the end of next year.

That future capability around predictive analytics designed to let companies make better and faster decisions is a core part of the IBM strategy: "We're gonna start to position for Smarter Systems or Systems for a Smarter Planet as that allows us to tell a point of view that no one else can offer," Adkins said. "With not just raw but intelligent performance, and optimization at every level, and predictive analytics capability, that's gonna be a much more complete point of view from IBM."

And here's Adkins on the hardware and systems capabilities of HP, Dell, Oracle-Sun, and Cisco:

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