PDA

View Full Version : On HP and Carly's Incompetence


Asher
20-11-2004, 04:23:43
As seen on my geekblog: http://counterplunk.blogspot.com

Sure, HP's sales are up this quarter. But that's compared to last quarter, when they tanked due to a colossal screwup in their management's push for an infrastructure upgrade that didn't work. She's since fired just about every manager involved in the mess, but the order came from the top for the update anyway. They lost a lot of customers, mostly to IBM, who are already rapdily stealing marketshare from HP in their former strongholds: high-profit, high-priced, high-performance computing.

Today, IBM accounts for 43.2% of the systems in the Top500 Supercomputer List, and 49.3% of its performance. HP, meanwhile, accounts for 34.4% of the systems, and 21.0% of the performance. And the trend is rapid and unmistakable -- HP's systems are becoming slower in comparison, and dropping rapdily off the charts. Less people are buying them, and those HP systems people do buy are slower.

The problem is, HP doesn't have a truly competitive solution right now in the high-end market. The three main players in this field are IBM, HP, and Sun. Both HP and Sun are rapidly losing marketshare to IBM, and trying new approaches to make up for it. Sun is making its Solaris 10 operating system free, as well as supporting Linux, and x86-64 (specifically, AMD's Opteron). They also have the promising Niagra chips coming, which take the concept of multi-core and multi-threading to the extreme: 8 cores per chip, each capable of supporting 4 threads (a total of 32-threads per chip). Sounds nifty, but it's not due til early 2006 and its performance is unknown.

HP, meanwhile, continues to only have Itanium in its high-end, big-iron solution box. Itanium is a decent chip...it's just not competitive. It may be in 2006, with a dual-core version...but how will it stack up? Unfavourably, I predict. And what software can they sell? Their UNIX OS, HP-UX, is dead. They don't make any real enterprise software.

And finally, IBM. IBM has the brand-spanking-new Power5 chips. These things are beasts -- easily the fastest chips on the planet. Just the other day, an IBM system with them dominated the industry database benchmark, TPC-C: The top IBM system scores 3,210,540 tpmC, with a price/performance of $5.19/tpmC
The top HP system scores 1,008,144 tpmC, with a price/performance of $8.33/tpmC

Not only that, but IBM can offer them a high-end database, DB2, and high-end reliable, fast OS, AIX.

HP is screwed. Sun is questionable, and IBM is dominating.

Interesting to see how the next few years shape up.

Vincent
20-11-2004, 16:53:53
Is this the boring thread contest?

zmama
20-11-2004, 18:21:15
A fine entry!

LoD
21-11-2004, 00:44:10
Dear Asher,

congratulations on your promotion to the Brownnosing Department of IBM.

Cheers,
LoD

Asher
21-11-2004, 01:19:47
I thought I was an MS fanboy?

No longer Trippin
21-11-2004, 07:01:02
You've now become both. Congrats.

Deacon
21-11-2004, 07:10:58
Microsoft is Darth Vader. IBM is the Emperor. :)

But seriously, I think critics of HP were right about the merger leading to a muddle.

Fiorina might not have been the one who decided way back when to put HP's eggs in Intel's basket, but HP could have reduced its commitment somehow. Also, acquiring Compaq meant dealing not just with Compaq's technologies, but with the technologies that Compaq got by acquiring DEC. HP-UX, Tru64, VMS, Alpha, PA-RISC, the Pavillion and the Presario lines of PCs, etc. It's a muddle. Compaq, HP, and DEC were often competing in the same spaces.

No longer Trippin
21-11-2004, 23:02:58
IBM the emperor, now that is an exageration. They own none of the consumer market and have competition in the server/workstation enviroment. They are an industry leader in fab technology along with Intel, and with help they are probably the only chip manufacturer that could top Intel (but that will take MS getting involved and it is). Granted if they do team up with MS and MS does release three versions of it's console as rumored, they are looking to really hit the PC market VERY hard in the consumer deptartment. But IBM needs MS help, and MS just needs to sell an OS and some office product... long as they can do that, they don't care what it is on... a PC or a glorified console. So I'd say IBM is Vader at most.. it needs Emperor Bill to rule.

Asher
22-11-2004, 02:51:39
They own none of the consumer market
Do you know what IBM stands for, my dear?
International Business Machines.

They're forgoing the consumer market. It's not their business. ;)

You place way too much emphasis on the consumer market, particularly because the context of this article and thead is clearly the big-iron server/supercomputer sector.

No longer Trippin
22-11-2004, 06:19:00
I know they are in the business market you puppet, but if you remember, IBM did sell home machines at a time, but then the major OEM's of today just did it better and IBM chose to keep a higher standard that costed more. I can't knock them there as I'd personally prefer quality at a price than a POS for cheap. I wasn't even knocking them for that as they are choosing to stay in the business end, and I don't fucking blame them. I mentioned that fact because the consumer market is where the majority of chips are sold. It doesn't take a brain surgeon to realise that a ton of chips at a decent ASP will beat out a few chips at a high ASP. Let alone the fact that IBM isn't nearly in the position Intel is in (even though it has an inferior chip, this isn't the first time, and AMD failed to capitilize before and still seems unable to really capitalize now on it's own at the very least - it's only in the black from FlashROM sales).

If you want to question that market in paricular, IBM has competition silicon wise (hell, you guys sell Intel as a solution quite heavily) and in the actual server/workstation market as well.

Lurker
22-11-2004, 18:34:08
That's what I was going to say.

Asher
22-11-2004, 19:04:05
I know IBM has competition in the server market, that's what this was all about.

The fact is, IBM is growing faster in that market than the competition (most of them are shrinking), and the performance gap and "bang per buck" keeps growing in IBM's favor right now as well.

Thank you for your insight on the consumer PC market though, I'm sure it'd be very interesting if it was related to what I was talking about.

Darkstar
22-11-2004, 20:17:20
Asher has definately changed badger holes.

Asher
22-11-2004, 20:56:57
Nope. :)

1) Linux still sucks
2) Windows is till the best desktop OS

Deacon
22-11-2004, 23:18:24
In the "cheap server" space, both IBM and HP have the option of joining x86 rather than trying to beat it. I don't see cheap servers being used for everything under the sun, but the consumer market has significance in that Intel and AMD can use it to bring down the cost of selling K7, K8, Netburst, and Pentium M as server chips.

But looking at just Power vs. SPARC, Itanium, etc., Sun is wobbly and Intel priced themselves out of the game.

Asher
24-11-2004, 15:29:42
http://news.com.com/IBM+extends+lead+in+server+market/2100-1010_3-5465301.html?part=rss&tag=5465301&subj=news.1010.20
IBM extends lead in server market
Published: November 23, 2004, 9:00 PM PST
By Stephen Shankland
Staff Writer, CNET News.com
TrackBack Print E-mail TalkBack

IBM increased its lead in a growing server market, nibbling away share from rivals Hewlett-Packard and Sun Microsystems, according to figures to be released Wednesday.

Sales of servers worldwide increased 5.5 percent to $11.5 billion in the third quarter of 2004 compared with the year-earlier quarter, according to market researcher IDC. IBM's sales grew faster, though, with revenue increasing 6.3 percent to $3.4 billion, giving Big Blue 31.7 percent of the market.

No. 2 HP grew slower than the market, increasing sales from $3 billion to $3.1 billion. Dell and Sun were essentially tied for third place, with Sun at $1.18 billion and Dell at $1.17 billion--but Dell's sales increased 14.1 percent compared with Sun's 0.1 percent, IDC said.

The overall market growth has been under way for six consecutive quarters, but only recently has it become strong, IDC analyst Vernon Turner said. Information technology spending now includes more new projects rather than just maintaining the status quo, he said.

"For a while the growth was close to inflation. Now we're seeing growth beyond inflation, which shows it is back to strategic thinking instead of just maintenance thinking," Turner said.

IBM and Dell rising while HP and Sun lose share of revenue has been a common theme in server market share statistics in recent quarters. So has the fifth-place position of Fujitsu and its European arm, Fujitsu-Siemens, whose sales grew 4.4 percent to $714 milli

Asher
26-11-2004, 13:48:04
http://www.theregister.co.uk/2004/11/26/ibm_power5_moores_law/

IBM, Moore's Law and the POWER 5 chip
By Robin Bloor, Bloor Research
Published Friday 26th November 2004 13:15 GMT

IBM's recent pSeries benchmark ought to raise a good number of eyebrows. Unix server benchmarks had previously been a game of leapfrog between IBM and HP, with IBM looking increasingly strong in the last round (in 2003) when its p690 server with 32 processors demonstrated a slightly higher transaction rate than HP's 64 processor Itanium 2 server. The latest benchmark from IBM leaves both previous benchmarks in dust. In the TPC-C benchmark, IBM demonstrated over 3m transactions per minute (tpmC) almost three times more than the previous highest result of 1.2tpmC, posting a 37 per cent price performance advantage in the process.

Never in the history of the benchmarking of servers (or databases) has any company demonstrated such a dramatic lead over the competition. When one vendor leapfrogged another by ten per cent or so (as regularly happened) you could argue that the difference was irrelevant. A benchmark is, after all, only a benchmark and technology just gets faster, doesn't it? But a difference of this magnitude cannot be dismissed in that way. IBM has clearly achieved something dramatic with its technology. If you analyze this benchmark result in any depth then you quickly conclude that there are several contributory IBM technologies that helped to achieve the result. However, here let us focus on what is, perhaps, the major one: the POWER 5 chip.

At a recent IBM analyst conference, Bernie Meyerson, who heads up IBM's semiconductor R&D development, gave a good explanation of what was happening at the semiconductor level. Moore's Law (which proposed that computing power would double every 18 months or so) was obeyed for decades in large part by miniaturisation - putting a lot more transistors onto the silicon with each new generation of chip. However, as he explained, miniaturization is a little more complicated than shrinking components to a smaller size. There are, in fact, 15 dimensions or characteristics that determine the behavior of the micro-circuitry that need to be kept in step.

Well, that was not too much of an obstacle until things got really really small and you had to deal with layers of material which were no more than 5 atoms thick. When you get down to that level, as has now happened, life gets complicated. The major problem that emerges is voltage leaks, which cause the chip to heat up considerably and ultimately put a block on progress. This is not the only problem, but it is the most difficult one to address. The upshot is that further miniaturization is not achievable without considerable innovation, particularly a different approach to power consumption.

Bernie Meyerson's message was simply this:

"Moore's Law is no longer guaranteed."

So how come, at this point in time, is IBM able to produce a blistering benchmark with its pSeries and POWER 5 chip?

Meyerson and his team saw the problem coming quite a few years ago and prepared for it in advance in the direction that he drove the PowerPC chip technology. I'll skip the full technical details, but to summarise:

Meyerson's team implemented innovations in on-chip design to cater for power management and address other miniaturization challenges. On top of that the design of the chip took a "holistic route" with functionality being added to better enable other IBM technology initiatives - such as the development of its hypervisor technology and the introduction of logical partitioning.

The consequence is that IBM is currently able to deliver in line with the expectations of Moore's Law and will probably be able to do so for the next two generations of the PowerPC chip. In fact, in terms of this benchmark, IBM is delivering beyond the expectations of Moore's Law. While chip performance may have doubled every 18 months in the past, system performance has not and IBM has now delivered almost a tripling of system performance (and a 37 per cent price performance improvement). That is what the benchmark indicates.

And IBM is doing this at a time when its primary competitors are "feeling the heat". IBM has demonstrated that it can overcome the problem, for the moment at least. It will be interesting to see how Hewlett-Packard, Dell, Sun and Intel respond to this.

Spartak
18-12-2004, 22:38:44
Does anyone read that boring blog of yours?

Asher
19-12-2004, 00:19:19
Yep.

There's 10 regular readers through the LJ syndication alone.

Spartak
19-12-2004, 14:59:52
Scary.