Hat Trick for HP's Small Biz Server

By Patricia Fusco | Posted October 17, 2003

HP this week announced pricing and support for one of Microsoft's Small Business Server 2003. As the worldwide small- to medium-sized business server market leader with more than $21 billion in revenue this year, HP intends to continue to dominate the space by providing small businesses with a one-stop-shop for complete server support systems.

HP's new servers come preloaded with Microsoft's Windows Small Business Server 2003 operating system and are set to start as low as $999 for the tc series and $1,398 for the ProLiant ML server series.

First on the Rink
One of HP's small business customers is already reaping the rewards of setting up a HP server operating Windows Small Business Server 2003. The Everett Silvertips, a minor league hockey team based in Everett, Wash. has setup HP's ProLiant ML350 running Windows Small Business Server 2003.

Terry Thom, IT Director of Washington state's newest minor league hockey team, said the combination of HP and Microsoft's 2003 operating system provides the team with the reliability and flexibility it needs.

"I worked in the PC industry for a few years as a Compaq/HP reseller," Thom explained. "When it came time to set up the system for the Silvertips, I went with HP because they provide an infrastructure of support that I know I can trust."

As for the reasoning behind tapping into Microsoft's newest operating system, Thom said he was impressed with the powerful business functionality afforded by Small Business Server 2003.

"Right now we're using it as a Web server to host the Silvertips e-commerce website," Thom said. "But down the road, we plan to support an Intranet for internal use, adding functions for coaches, players and staff."

One of the functions Thom wants to setup is a virtual coach of sorts. The plan is to take videos of the team in action and provide blow-by-blow analysis for coaches and players to review online.

"We already have videotapes of every game," Thom said. "We hope add play-by-play analysis to the video, then provide a secure login for players and coaches to review the tapes."

While cost remains a key factor when many small businesses consider adopting server-based computing systems, Thom said the Silvertips' priorities were different.

"For us, cost was not a top priority, it was a matter of control," Thom said. "We're a PC-savvy bunch. We want to take our cookie cutter website and rebuild it into a unique design, maybe add ticketing functions, and improve internal correspondence for staff members. We chose the HP-Microsoft combo because it meets our needs now, and in the future."

Tough Sell?
Microsoft is certainly banking on its future on the Small Business Server 2003 operating system. According to Joe Wilcox, Senior Analyst for Jupiter Research, Microsoft does not dominate the small- and mid-sized business server market.

Findings from a study completed by the research firm in June indicate that only 39 percent of U.S. small businesses currently operate their own e-mail servers. Wilcox said small businesses predominately use either Microsoft Exchange or Lotus Notes to serve up their own e-mail.

"SMBs are starting to get pretty savvy about server-based computing as they become more knowledgeable about using the Internet for business communications," Wilcox said. "As a result, small businesses are exploring their options more."

Wilcox said the good news for HP, is that U.S. small businesses like to buy direct. In June, Jupiter Research completed a survey of SMBs with fewer than 1,000 employees and found small businesses thoughts on buying channels have shifted.

"They want to buy direct," Wilcox said. "Fifty-seven percent said they buy their hardware direct and 33 percent said they buy their hardware from a local reseller. On the software side, 49 percent of small businesses said buy direct and 28 percent said they buy from a local reseller."

The bad news for HP is that it has to vie with Dell and Gateway in the direct-sell segment, and IBM's powerful reseller channel that prioritizes Linux-based server systems for SMBs. Surprisingly, Jupiter Research's study found Linux penetration is much higher in the SMB market than expected.

"Of the U.S. small business with servers already deployed, 26 percent are using the Linux operating system," Wilcox said. "Additionally, 21 percent of small businesses said they plan to use Linux and two percent said they plan to use Lindows for server deployments in 2004."

This doesn't mean that Microsoft's older operating systems are not popular within the SMB market. Fifty-six percent of small businesses surveyed with a server system in place use Windows XP Pro and 55 percent use some version of Windows NT. Nineteen percent of small businesses are using more than one operating system.

For small businesses like the Everett Silvertips that are making their first foray into server-based computing, Microsoft's Small Business Server 2003 on HP hardware was the smart choice — a choice that will need to be made by many more small businesses if HP is to retain its top spot in the worldwide SMB server market.

Do you have a comment or question about this article or other small business topics in general? Speak out in the SmallBusinessComputing.com Forums. Join the discussion today!

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