28 January 2008
by Paul Kunert
Lenovo will enter the volume server market inside 12 months after signing a licensing agreement with IBM to manufacture one and two-way rack and tower systems.
The deal follows months of negotiations between Lenovo and Blue Blue, which channel sources believed at one point could have resulted in the sale of the entire System x division. IBM continues to sell one and two-way servers.
This will give Lenovo access to the x86 server market, considered important to the growth of its PC line as SME customers often buy both form factors when refreshing their infrastructure.
"There was demand from our business partners to broaden their relationship with us… we needed servers and that is why we made this move," said Marc Godin, Lenovo worldwide vice-president and general manager for the new server business unit.
Gearing up for the launch of its own-branded systems, Lenovo is recruiting staff, increasing supply chain capabilities and developing a "differentiator".
"This will come from the way we go to market and the software that we load on the system — the system will be customised to meet the needs of the SME market," Godin told MicroScope.
He said it priced the product independently of IBM but refused to be drawn further on potential changes to partner Ts&Cs or the future addition of other IBM servers.
The deal could cast doubts over IBM’s long term ambitions for the x86 market, with Alistair Edwards, senior analyst at Canalys, asking: "How committed is IBM to the x86 business? It divested the PC division to Lenovo; will it make a similar move again?"
But Rob Tomlin, sales director at Interface Solutions, did not expect IBM to exit the market but to focus on mid-tier customers with Lenovo targeting smaller firms.
