When it comes to PC servers, Compaq Computer Corp. has its competitors
beaten hands down, and that doesn't seem likely to change in 1998.
While Compaq rests comfortably on top, underneath the PC server market is a battlefield. Dell Computer Corp., Hewlett-Packard Co., IBM, Digital Equipment Corp. and Gateway 2000 all have been battling it out in the middle to low-end computer market over the past year.
But despite the sound and the fury, the names on the boxes signify almost nothing. When it comes right down to it, PC servers are nearly identical.
They're Pentium processor-based, have similar operating speeds, run Windows, and all tend to have things like hot-swappable disk drives, extended Level 2 Cache and so on.
The PC server "has effectively become a commodity," says Daniel Kusnetsky, an analyst at International Data Corp., a Framingham, Mass.-based consultancy.
So now the question is, how does a company distinguish itself?
Racing with the also-rans
Compaq is sitting pretty. In the third quarter of 1997, it was responsible for 31.5% of the world's PC server shipments, IBM was second with 13.3% and HP was third with 12.6%. Although the growth of Compaq's market share was sluggish, it's still solidly at the top of the heap."I don't see Compaq losing ground," says James Gruener, an analyst at Aberdeen Group, Inc., a Boston consultancy. "They have an advantage with their connection with Intel Corp. They're savvy in how they get customers."
So what will help the runners-up distinguish themselves in '98? Price? Service? Clustering capacity? Image? Tough question.
One analyst believes Dell, with its aggressive marketing and new service orientation, could break away from its second-tier rivals in 1998.
"Dell is prepared to deal with the 24/7 nature of the beast," says Cheryl Currid, principal analyst at Houston-based consultancy Currid & Co. But other than that, she says, "I don't think we'll see too many inroads made in the corporate server market."
