"Dell has made rapid progress growing its server and storage
business over the last year. Its already captured 25% of the U.S.
server market, more than Hewlett-Packard (NYSE: HWP) and IBM (NYSE:
IBM) combined, according to CEO Michael Dell. Roughly 15% of Dell's
$25 billion in sales last year came from servers."
"But Dell won't use Compaq as a benchmark. Rather, it will have
to compare itself to Sun Microsystems (Nasdaq: SUNW) , the go-go
manufacturer of high-end server products. Sun has positioned itself
as the dot-com infrastructure leader. "This is ground zero for
Dell's business," Dell told analysts when speaking about the server
market for small businesses. "If we don't win here we are not
succeeding. Sun is the number one competitor to measure us
"Dell said his company has two key advantages. First,
lower-cost servers now have the functionality to compete against
higher-end products. Second, Dell doesn't think Sun will fully
support Linux, the open source software system. "My belief is that
Sun will not embrace Linux, and this is a huge opportunity for us
to move right into their space," Dell said."
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