IBM attacks Sun’s server claims

IBM Corp. launched an assault Friday against rival Sun Microsystems Inc., charging that Sun has engaged in a “desperate effort” to claim the lead in worldwide server sales. Big Blue shot back at Sun by citing new research figures due next week from Dataquest Inc. that put IBM atop the worldwide server market.

During a Thursday conference call with press and analysts, Sun relied on its market share mantra, saying it can keep pulling ahead of competitors even during tough economic times. Sun cut its earnings estimates for the third quarter around 50 percent below analysts’ previous expectations but asserted that it is poised for continued leadership.

“I have been consistent on market share for years,” Ed Zander, president and chief operating officer at Sun, said during the conference call. “If you look at HP’s market share numbers form last quarter and look at ours and look at IBM, I just think we are going to take globs and globs of market share. The fact again — passing IBM in revenue for all servers — is something we are pretty happy about. That is something we set out five years ago to do, and most people thought it was an insurmountable task — to be the number one server company on the planet — and to be there today is really a feat that we are going to maintain and grow.”

Zander’s words touched a nerve with IBM because Big Blue believes it maintains the number one position worldwide in total server sales based on Dataquest’s new study on server shipments in 2000.

Dataquest’s numbers show that IBM’s worldwide server revenues totalled US$13.7 billion for the year compared with $9.7 billion for Sun, IBM said. IBM also highlighted its shipment figure of 656,457 server versus 289,040 servers for Sun.

An IBM spokesman referred to Sun’s claims as a “dark smoke screen” and said that IBM’s rival would “say anything now.”

Sun, however, chalked the IBM attack up to a mistake made by Zander and Scott McNealy, chairman and chief executive officer at Sun, during various public conversations over the last two days.

“The boys might have been a bit overzealous. The worldwide data did not come out until last night or early this morning,” said Sun spokeswoman Lisa Ganier.

Zander and McNealy were apparently loose with their words and meant to refer to a Dataquest study that went out earlier in the week, marking Sun as number one in total server sales in the US only, according to Ganier.

Sun maintains Zander and McNealy could not have meant exactly what they said because no one had seen the figures until after their statements.

Sun, in Palo Alto, Calif., can be contacted at IBM, based in Armonk, N.Y., can be reached at

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