Houston, Texas - You can see the future of Windows NT in Compaq Computer Corp.'s acquisition of Tandem Computers, Inc.: large-scale, low-cost NT servers that can handle high-volume transactions and armies of users.
The $3 billion deal is Compaq's response to the fast-growing market for servers running Windows NT and the limited size of those servers today.
With Tandem's ServerNet clustering software, which Compaq licenses today, Compaq will better be able to yoke Intel processors to create large-scale processing platforms for NT applications.
In addition, Tandem's parallel processing Unix servers, with database, transaction processing and middleware software, will let Compaq deliver machines for the huge transaction applications that are likely to emerge on the Internet. Compaq li-censed ServerNet a year ago from Tandem. Tandem, in turn, has been looking to expand the market for its software technologies by moving into the high-volume PC server business.
But integrating Tandem's high-end Unix software and Compaq's lower end Windows NT-based servers could be tricky, and the differing corporate cultures could be an obstacle, analysts said.
"Tandem has an unassuming, low-profile approach to large accounts," said Cedric Thomas, president of FronTier Associates, a Paris-based consulting firm. "Compaq has a high-volume approach through distributors, and they [Compaq] have the reputation of being arrogant."
Both companies have been working closely with Microsoft Corp. to ensure a growth path for NT. In fact, Microsoft hired Tandem to rewrite key parts of ServerNet for Windows NT: the ServerNet technology is an essential part of Microsoft's Wolfpack NT clustering technology.
Tandem has its own line of two-, four- and 16-way Pentium Pro processor-based NT servers, but has had to sign up manufacturers to make the boxes, according to Steve Josselyn, an analyst at International Data Corp., (IDC) a market research company in Framingham, Mass. Now Tandem will most likely stop selling these servers, and Compaq will probably replace them with its own ServerNet-enhanced NT boxes, he said.
On the opposite end of the scale, Tandem adds high-end, massively parallel systems to Compaq's range of servers and desktops for the enterprise, said Lorraine Cosgrove, research manager at IDC.
Compaq has centered its scalability strategy on grouping Intel processors into robust NT-based PC servers, while Tandem has concentrated on porting ServerNet clustering technology and other software from its high-end, parallel-processing Himalaya line of Unix servers to NT, she said.
However, combining the two somewhat disparate technologies will not be easy, says Eric Woods, analyst at London- based Ovum, Ltd. "It will be a challenge to deliver that level of integration," he said. Mergers of this size often have cultural and strategic problems as well, he added.
- Essick is correspondent with the IDG News Service in London.
