By William Fellows
Amdahl Corp is swallowing Siemens Computer Systems’ $60m, 90- person US sales operation as part of a worldwide consolidation of the German company’s computer operations into the local operating units of Fujitsu Ltd. It will be headed by Alan Bell, group president of Amdahl’s $1.3bn product solutions group formerly known as Amdahl Plus. Amdahl is a $2.2bn wholly-owned unit of Fujitsu. Siemens’ Australasian operations will likely be folded into Amdahl’s local unit there too, while Siemens’ Japanese computer interests will be taken over by Amdahl parent Fujitsu.
The deals mark the execution of the two-tier pact between Siemens AG and Fujitsu under which Fujitsu has taken on Siemens’ European computer systems business in a joint venture called Fujitsu Siemens Computer Systems and put in place a worldwide marketing alliance. Siemens’ non-European computer systems operations are being folded into local Fujitsu operations as part of the pact which Fujitsu hopes will set it on the way to becoming the third largest IT vendor worldwide (it’s now number five) and largest European vendor (it’s currently number two) by 2001.
Amdahl will run Siemens’ US unit at arms length in a bid to save its relationship with Sun Microsystems Inc. It resells about $200m of Sun kit a year, but it’s the additional and growing services business Amdahl does on top of these sales, worth $200m and growing fast, which is the crown jewels of the relationship. Sun is still somewhat tainted by CEO Scott McNealy’s often quoted suggestion that product companies go into services to die and has a long way to go to make up ground on its Unix server peers.
The problem in this case is that both Fujitsu and Siemens have or are developing systems that compete directly with the high-end of Sun’s server range, the products Amdahl primarily resells. Fujitsu has for the first time begun to aggressively market its own high-end Unix server range which use Sparc CPU technology and run Solaris just like Sun, beginning with their introduction into Europe last week. Siemens is developing Sparc versions of its Reliant Unix server range and will ultimately migrate to IA-64 platforms running Solaris.
Bell told ComputerWire that there are no current plans for Amdahl to remarket either the Siemens or Fujitsu Unix servers – although the Siemens group will try to keep its business going – but he admits there’s going to be some delicate discussions about future strategy. The relationship will likely be decided at a higher level anyway. Fujitsu and Sun have close technical and marketing links. Some years ago Fujitsu committed to spend $500m on Sparc system development, marketing and promotion and the two recently agreed to share IP on their high-end CPU developments (see separate story).
Bernd Puschendorf, VP and managing director of Fujitsu Siemens Computer Systems’ German operations told ComputerWire that with Siemens Computer Systems’ US sales organization going over to Amdahl by the end of the year will mean it has the possibility of doing more business in Unix worldwide.
