Cisco launches Unified Computing push with new blade server

Ambitious new direction for the networking company is a big risk, say analysts (see video below)

Cisco Systems Inc. and several industry partners today launched an ambitious new design for data virtualization that the vendor is calling the Unified Computing System. The entire UCS relies on a new Cisco blade server that runs on Intel Corp.'s upcoming Nehalem processors.

It's an ambitious new direction for Cisco, which has not been in the server business, analysts said. Part of the UCS, however, will include a new switch for data centers, an area in which Cisco has been providing switches for years.

The advantage of the new system, which incorporates Cisco UCS B-Series blades, will be the Nehalem's extended memory technology, which supports the movement of more virtual machines than before, Cisco CEO John Chambers said.

Many of the details of the UCS were not disclosed and will be announced next month, officials said.

There are 10 beta customers for the new UCS, and shipments are expected sometime in the second quarter. Analysts predicted that the starting price will exceed $100,000.

Chambers called the UCS a "market transition" for Cisco. "We believe that the network is at the heart of tying this all together," he said. "We look at this market as [Cisco] bringing virtualization to life."

Several Cisco officials said that virtualization in data centers is not widely used but that the UCS concept will make it less expensive to deploy, reducing both capital and operating expenses.

Today's announcement was made on Cisco TelePresence systems in 11 cities around the globe. Intel, Microsoft, VMware, BMC Software, EMC, Emulex, NetApp, Novell, Oracle, QLogic and Red Hat were named as partners in the UCS initiative, and several CEOs from the partner companies attended the announcement. Systems integrator Accenture Ltd. was announced as a partner that will help provide services on the new UCS.

Cisco executives have said that the network is the best place to tackle many of these tasks because it is the only element of the infrastructure that touches everything.

One financial analyst attending the announcement at Cisco's TelePresence room in its Boxboro, Mass., offices said that CIOs and customers will automatically question Cisco's ability to maintain its new servers, even with Accenture's help. "Cisco is going to obviously be new at this," said William Blair & Co.'s Jason Ader.

But Ader and several other analysts said the bigger concern for Cisco is how it will market servers when its partners on large accounts include well-known server makers IBM and Hewlett-Packard Co.

"It's both a risk and an opportunity," Ader said. "There will be a battle over who controls the customer accounts." The problem is that HP and IBM have been partners on data center projects with Cisco in the past, offering their servers with Cisco switches.

Cisco's new Unified Computing System

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