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Compaq Partners with Intel on Server Appliance Line

Compaq Computer Corp., seeking a foothold in the smaller, less-lucrative but rapidly growing server appliance market, has become the second major OEM to announce that it will sell Intel Corp.’s NetStructure line of appliances.

Compaq will be a sales and distribution channel for the NetStructure SSL, VPN and XML appliances, according to John Young, vice president of the TaskSmart server line. The partnership, he says, “allows us to enter into smaller categories for market size. We’ve made a pretty significant investment in a number of server appliance categories, and this gives us a nicely rounded portfolio.” Most of the appliances would fit into a Web farm or Internet data center, Young believes.

Server appliances are small, single-function computers that come pre-configured for a job. The SSL appliance, for example, would speed up e-commerce servers by offloading the encryption tasks that eat up CPU cycles. The SSL appliance would do encryption as its only function. Appliances are usually inexpensive, can be quickly added to a farm, have basically no configuration since software comes pre-installed, and are easy to maintain.

Hewlett-Packard Co. announced last December that it was also selling NetStructure appliances, but it is offering a broader range of the NetStructure line.

Originally, Intel had said it would sell its NetStructure appliances through its own channels, bypassing traditional OEM partners like Compaq and HP. Late last year, Intel reversed course and went back to their traditional model, leading to speculation among analysts that it never intended to sell the appliances on its own, but only wanted to increase visibility in the server appliance space to enhance sales.

The appliances, available immediately, start at a street price of $2,550. - Keith Ward

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.

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