Dell has put the brakes on the development of eight-way Intel Xeon servers. This is good news for Hewlett-Packard, IBM and Sun. They are now alone on the road to scaling servers with eight or more processors.

Dell is instead focused on scaling servers out rather than up by adding servers to the cluster. Many enterprise data centers run back-end operations that need to scale beyond two- and four-processor machines. Eight-way servers give CRM and large database applications room to grow. But how much do today's 1-GHz-plus processors need to scale up? Clearly Dell is betting on the answer being "not much." And it's hard to second-guess a company that has been in the black the past two years, gaining in worldwide server shipments and leading in preliminary reports of U.S. server shipments for the first quarter of 2003 (press.gartner.com/press_gartner/quickstats/servers.html).

Moore's Law and Dell's manufacturing process will put the company in a strong position to market two- and four-way server packages that contend with big eight-way servers. Big iron requires more engineering and development time than small servers. Small servers can take immediate advantage of newer chipsets, bus speeds and network processors. For the price of an eight-way server, you can get multiple two- and four-way servers running with the latest processors at gigabit network speeds. These servers can be clustered for load-balancing and fault tolerance, increasing availability and potentially reducing operating budgets when you consider maintenance, and service and support.

Eight-way and even larger server architectures will have a place in the enterprise. It's difficult to replace raw horsepower and the ability to pop another processor into a box to increase availability. But as processors advance, Dell sees eight-ways giving ground to smaller, dedicated server appliances. HP, IBM and Sun may not be looking at Dell in the rear-view mirror on the scalability road much longer.

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