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IBM Takes On Sun, HP With Next-Gen Unix Servers: Page 2 of 4

"That means the virtualization of the Power5 is coming down to the mid-market, giving them, and even bigger small businesses, access to technologies that until recently were available only to mainframe users," added Ryder.

The first three models of the p5 server include the two-way p5-520 and the four-way p5-550, both of which run 1.65GHz Power5s; and the 16-way p5-570, which uses 1.9GHz Power5 processors. IBM will roll out larger systems down the road, said Freund.

All the p5 run IBM's updated versions of Unix, dubbed AIX 5L and AIX I5, and Linux (Novell's SuSE or Red Hat); the top-of-the-line p5-570 can also run the new IBM i5/OS operating system, the successor to OS/400 which runs Big Blue's i5 systems.

This is the first time that the iSeries and pSeries use the same hardware and are able to run the same set of operating systems. In fact, there are now more similarities than differences between the two lines, a strength that will play to IBM's advantage, said analysts.

"The boxes may be the same, but the markets [for each] are different," said Ryder. "Now IBM can tailor solutions to the customer."