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Hardware Today: Gateway Server Snapshot

Monday Aug 15th 2005 by Drew Robb

Gateway may be leaving the large-scale enterprise market to the Big Four and concentrating on the lower end, but its latest offerings are state-of-the-art enough to warrant a closer look.

Gateway's revamped server offerings have given the company renewed market impetus, particularly in the government and education sectors. In the past few months, the company overhauled its rack and tower products, adding better and larger SCSI drives, more RAID options, lower-priced SATA drives, redundant power and fans, more powerful chips, and an improved 4-way server.

"We are not targeting the telco or Fortune 500, as HP, Dell, and IBM do business there, and it gets very competitive," says Tim Diefenthaler, Gateway's senior director server product marketing. "We aim more at the public sector, as well as midenterprise accounts."

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While the company does a good bit of government business (on the federal, state, and local levels), it is especially strong in the education field. Diefenthaler cites this as a strategic sector for Gateway, and one on which the company places particular emphasis, as evidenced by the large complement of sales staff assigned to the education sector.

"We have excellent price-performance products that meet the needs of the education market," he says.

Gateway on the Rack

Since the last Gateway Server Snapshot appeared in ServerWatch, the company has considerably upgraded its products, as the table below illustrates. The recently released Gateway 9415 contains the latest technology. It has a 1U chassis with three hot-swappable SCSI hard drives (up to 300 GB per drive for a maximum of 900 GB per server) and redundant power supplies.

Gateway Server Snapshot
Server Description Processor Range No. of Processors Base Price
9510 Workgroup and enterprise tower server with flexibility and performance, hot swap redundant cooling and optional redundant power Dual Xeon Processor, 2.8GHz to 3.6GHz (1MB and 2MB Cache) 1 to 2 $999
9315 General-purpose, 1U rack server with solid performance and RAID 5 protection Dual Xeon Processor, 2.8GHz to 3.6GHz (1 MB and 2 MB Cache) 1 to 2 $999
9415 High-performance 1U rack server with high availability features, including hot-swap redundant power supplies and RAID-5 reliability Dual Xeon Processor, 2.8GHz to 3.6GHz (1 MB and 2 MB Cache) 1 to 2 $1,199
9515 Scalable 2U rack server with high availability and performance, hot swap redundant cooling and optional redundant power Dual Xeon Processor, 2.8GHz to 3.6GHz (1 MB and 2 MB Cache) 1 to 2 $1,249
9715 4-way rack (or available tower configuration) server providing maximum uptime for mission-critical applications and environments MP Xeon Processor, 3.0GHz to 3.66GHz (1 MB or 8 MB Cache) 1, 2 or 4 $3,999

"Redundant power in small form factors is being required by most of our customers due to the amount of data you can put in the box," says Diefenthaler.

According to Diefenthaler, this is the first 1U chassis available with redundant power that can run RAID 5. Dell and HP 1U units, for example, have only two SCSI drives that can run only RAID 0 and 1. The 9415 is aimed at large data centers running applications like ERP, CRM, Web servers, and database, as it offers the processing power and redundancy in a 1U box typically found only in the 2U form factor. Pricing begins at $1,199.

Gateway showcased two other new rack servers earlier this year. The Gateway 9515 has a 2U enclosure, six hard drives (each up to 600 GB), up to six PCI slots, and redundant power. The Gateway 9315 is styled as a value-based 1U rack. It has a dual processor, but no redundant power and dispensed with SCSI. Instead, it uses three lower-cost (and somewhat lower-performance) Serial ATA (SATA) drives. Each drive is up to 400 GB drives and can be placed in a RAID 5 configuration.

"The Gateway 9315 is really for the public sector and certain business applications like backup server," says Diefenthaler. "It gives decent performance, a lot of capacity in a small space, and doesn't cost a lot."

>> Stacking Up to the Competition

Towering Above the Competition

In the tower category, the company has also been busy. The Gateway 9510 is essentially an upgraded combination of two older models: the Gateway 960 and Gateway 980 towers. It supports six SATA or 10 SCSI drives. which equates to either 2.4 TB SATA or 3 TB SCSI. Rather than having a separate raid controller, it has RAID on the motherboard as a cost reduction feature. It also has hot swappable redundant fans and power supplies.

"The Gateway 9510 has been our best seller due to the flexibility of the box," says Diefenthaler. "It is selling very well in the public sector, education, SMB, and midenterprise."

Last week, the newest member of the family shipped: the 4-way Gateway 9715. It supports up to 32 GB of ECC DDR2 memory and 10 SCSI drives (3 TB of internal storage), and has redundant fans and power. While this 4-way unit is important strategically for Gateway, the company doesn't necessarily expect it to be a best seller. Rather, Gateway believes its presence will prevent sales personnel from being frozen out of a whole lot of deals. Many bids, it turns out, specify a dual processor, a minimum amount of memory, and four processors. A customer may not end up buying a 4-way system, but it is often in the bid.

"Our 4-way business may be a fraction of our other server sales, but we use it as a vehicle to generate more accounts," says Diefenthaler. "It enables us to compete for many more customers in education, government and commercial."

Further, this 4-way server is marketed as a blade alternative (Gateway doesn't offer blade servers). It can be used with virtualization software from Microsoft or VMware to create multiple operating system instances. Gateway prefers to promote the 9715 for this purpose rather than adding another product to the roadmap.

Intel Inside

Just as Gateway's server portfolio is lean and focused, the vendor prefers to keep chip choices minimal. Its racks and the Gateway 9510 tower use the latest Intel Xeon DP 3.6 MHz processor with 2 MB of cache. The 4-way 9715 tower, on the other hand, has a Xeon MP chip.

While this 4-way unit is important strategically for Gateway, the company doesn't necessarily expect it to be a best seller. Rather, Gateway believes its presence will prevent sales personnel from being frozen out of a whole lot of deals.

"Our product line is now Intel across the boards," says Diefenthaler. "For the markets we are serving, it represents the best choice."

With such a heavy government and educational focus, Intel is indeed a wise partner. These industries have been specifying Intel chips for years, and AMD has been fighting an uphill battle to make headway in the government sector due to an ingrained preference for Intel products.

"Our government, education and business target segments are asking mostly for Intel," says Diefenthaler.

With its wagon hitched to Intel, it's no surprise that Gateway doesn't yet offer dual core. The company reports, though, that it supports Intel's dual core strategies. As the chipmaker releases dual core, look for Gateway to augment its server offerings with some dual-core models. We anticipate a dual-core server announcement from Gateway toward the end of August.

Another of Gateway's strategic relationships is with Microsoft. The company doesn't offer exclusively Microsoft operating systems, but it certainly focuses on them. Servers come preloaded with Microsoft Windows Server 2003. This hardware is certified also for NetWare and Linux, but the machines don't come with those operating systems preloaded. This is an issue for industries where other operating systems dominate. NetWare, for example, is still big in certain educational markets.

"Well over 75 percent of our customers are using Windows," notes Diefenthaler

Service Plan

Gateway's server strategy, then, is to take a simple, focused approach to the market. Thus, it is leaving the large-scale enterprise market to the Big Four and concentrating on the lower end.

"We have six servers that meet the lion's share of customer needs. This considerably reduces our costs by only supporting those models, and it also enables us to support them well." — Tim Diefenthaler, senior director server of product marketing, Gateway

"We have six servers that meet the lion's share of customer needs," says Diefenthaler. "This considerably reduces our costs by only supporting those models, and it also enables us to support them well.

For example, Gateway offers customers three-, four-, or five-year service plans that include two- and four-hour on-site response via yet another partnership — this one with IBM Global Services. The plan's competitive pricing has proved popular in education and other markets that don't have a large IT staff. As a result, Gateway boasts that more than 40 percent of server customers also buy this type of support plan, high by any standards.

When it comes to the market as a whole, Gateway may remain far behind Dell, IBM, and HP. But it has been making steady progress upward in the past two years.

It is now just about level with Sun for fourth place in the x86 space. The company hopes its upcoming releases will secure that spot.

"SATA technology is driving considerably volume of sales currently," says Diefenthaler. "Sales will be further strengthened by our upcoming dual-core release, as well as the additional of Serial Attached SCSI (SAS) products next year."

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