high-end Intel (four CPU) rackmount servers, the NetServer LH 4r and LXr 8000,
are generally used for larger installations, such as data centers/warehouses,
and by large companies wanting to minimize the floor space their computers use.
Rackmount servers provide the ability to put a large number of CPUs in a small
footprint, or to combine CPUs with a large number of peripherals (usually disk
drive subsystems). These compete primarily in the enterprise computing market
space. HP's largest competitors are Compaq, Dell, and IBM. (Refer to Table 1
and Graph 1 for market share figures). The rackmount market is growing, partly
due to server market growth in general, and partly due to a shift from pedestal/floor-standing/"tower"
servers. We believe that rackmount servers will be about 60% of the general
server market within 1-2 years (vs. 30-40% 2-3 years ago), and greater than
80% of the high-end Intel server market within the same time period.
1: Intel Server Market Share 2Q '99
Strategy and Trajectory
is positioning these high-end servers in two ways. The LH 4r and LXr 8000 are
geared toward workgroups who expect to expand significantly over time. The LH4r
accomplishes this by having a large number of disk drive bays which can be used
to expand storage capabilities. The LXr 8000 uses its upgrade capabilities (from
a four-CPU to an eight-CPU by swapping out main logic boards) as the means to
expand. In addition, HP focuses on its traditional strength of high reliability,
accomplished through hot-swappable and redundant components.
focuses more on breadth of functionality than depth. In the next three to five
years, the positioning of these products will change from high-end to mid-range,
consistent with the general trend in Intel servers.
Features: The LH 4r provides more I/O slots (8) than comparable offerings
from Compaq and Dell, and only its "family member", the LXr 8000 (10), and IBM's
Netfinity 7000 (12), provide more I/O slots.
The LH 4r allows the largest quantity of disk drives (8x1.6" or 12x1.0" high)
of any of the offerings by the "Big Four" server manufacturers (Compaq, Dell,
HP, IBM max. available for others is 6x1.6" or 8x1.0"). In addition, HP supports
seven different RAID levels, more than its competitors support.
Features : As with the LH 4r, the LXr 8000 provides lots of I/O 10 slots
total exceeded only by IBM's Netfinity 7000. In addition, four of these slots
support PCI Hot Plug, and HP provides the necessary drivers to have it work
under Windows NT 4.0. (Normally, PCI Hot Plug will not work under NT 4.0.)
The LXr 8000 can handle up to 8 GB of RAM, double what the competition (except
for the Netfinity 7000) can handle.
The LXr 8000 is designed to allow the unit to be upgraded to the LXr 8500, HP's
soon-to-be-shipped eight-CPU system.
has earned a reputation for power/packaging excellence, with good hardware ergonomics.
In addition, the operating temperature range for their servers is wider than
for their major competitors, which allows slightly more flexibility vis--vis
where a customer could/would install the system(s).
At only 19,050 tpmC, the LH4r's score is lower than competing models from Compaq,
Dell, and IBM by 5-15%. Although the TPC-C scale is not the only one used by
customers, it is an important one.
The LH 4r (as submitted to TPC) costs $23/tpmC, 40%-60% more expensive than
the Dell 6300 or the Compaq 5500. This can result in an additional configured-system
cost of $50K-$100K for lower performance. (Please also see comments below
The LXr 8000 maxes out at only two drives of either size, the fewest of
this class. In addition, there is only one free 5.25" removable media bay (e.g.
for a DAT), a deficiency compared to the competition.
At $26.87/tpmC (as submitted to TPC), the LXr 8000 per-transaction system
cost is 65% higher than comparable Dell PowerEdge systems, and 75% higher than
the Compaq ProLiant 5500-6/550's per-transaction cost. This equates to the LH4r
costing ~$250K more vs. Dell's similar-performing system, or ~$300K more for
a system performing 5% better than Compaq's. This is a large premium to pay.
Dell and Compaq, HP has no 4U-high, four-CPU system at present. We believe this
is a hole in the product line, although HP seems content to stay with the 7U
chassis for now.
question HP's claim to fit seven 7U-high systems into a 41U high rack. (The
in-joke here is that HP requires an 8U "rack extension kit", and thus is comparing
a 49U-high rack to the competition's 42U-high racks not exactly an apples-to-apples
comparison, especially when the extension is only rated for 45 lbs, about the
weight of an empty server chassis. We question the legitimacy
of HP presenting this information as something a customer could actually do.)
HP is planning to phase out this product within six months, it should look at
improving both the performance and price/performance figures.
must find a way to get more built-in storage, both hard drives and removable
media. A box this size should have enough space for that to be done. HP's design
team should consider shrinking the LCD front panel display in order to free
up more space on the front surface.
should also promote the LXr8000-to-8500 upgrade path aggressively, as this can
help customers preserve their original investment (do not have to throw out
the LXr 8000 enclosure to upgrade to an 8500), and it can be a key differentiator
from its primary competitors.
believe the lack of a 4U-high system is something HP should remedy quickly.
However, if HP's market focus is "lots of CPUs running separate disk drive enclosures"
(a/k/a disk farms), as is demonstrated by the lack of internal storage in the
LXr 8000, then they should make a small "hot box", similar to Compaq's and Dell's
concerns relate to HP's active marketing of an 8U-high rack extension, which
is supposed to convert a standard 41U-high rack into a 49U-high rack. (HP's
stated purpose is to allow the customer to put seven 7U-high servers in one
rack, as compared to six for Dell or Compaq in a 42U-high rack.) Since the maximum
load for the extension is 45 lb., and HP's servers weigh 90-135 lb., using this
extension to add a server can lead to safety issues. In addition, since a 49U
high rack needs an eight-foot door opening (rare to nonexistent), the extension
must be add on-site, or the rack must be tipped, either of which is a deficiency.
who want lots of I/O and storage capability in one system will like the NetServer
LH 4r, even with the premium paid for price/performance. However, given poor
system performance, customers should try to leverage this shortcoming into a
the LXr 8000, customers need to decide if they need the I/O capabilities and
added RAM that the system provides. If they need only six or eight I/O slots
and 4 GB of RAM, then Dell and Compaq should be considered for more cost-effective
the upgrade path of the LXr 8000 to the 8500 (eight-CPU) is a potentially valuable
feature, but customers should review this in the context of their overall needs.
the shortcomings mentioned above, HP's power/packaging designs are very good
easy to service with good ergonomics. We expect HP to continue providing well-designed
enclosures, and to overcome the significant deficiencies described above but
only after the LXr 8000/8500 series get replaced, about 2-3 years from now (65%
do not expect HP to make a concentrated effort to be price/performance leaders,
since that would run counter to their present set of performance-focused but
slightly expensive offerings. (70% probability)
has been losing market share in recent years, primarily due to Dell's compelling
price and delivery message. HP will continue to maintain a presence, and its
Wintel/Unix capabilities allow customers to go to one vendor for both. We believe
HP will maintain its share in the 8%-12% range (60% probability).
Xeon: Intel Corporation CPU
U : Rack unit = 1.75"
HDD: Hard disk drive
tpmC : Performance unit, transaction-based (for further info:www.tpc.org
Transaction Processing Performance Council)
NIC : Network Interface Card
PCI :Peripheral Component Interconnect (an internal I/O bus)