BA goes rental over Unix servers

The self-proclaimed 'world's favourite airline' is to start renting its Unix servers from Sun, rather than buying them.

British Airways (BA) will only pay Sun for the server capacity it uses, enabling it to cut overheads. BA's service delivery manager, David Weston, explained the attractions of the deal. "Rented equipment is less capital intensive and is more flexible in terms of capacity demand and technology changes."

BA will initially rent three Sun Starfire servers for its sales and marketing operations at Heathrow, which use the largest databases in the company. But Sun and its systems integrator, Amdahl, hopes its flagship customer will eventually scale up to 64 servers.

The move is the latest in a series of moves from purchased to rented equipment. The airline caused a storm last year when it became the first major UK company to lease mainframes from IBM. Weston has already applied the same principles to BA's storage suppliers, StorageTec and EMC.

Martin Hingly, senior research director at IDC, explained the phenomenon. "Suppliers need to find new business models, now that hardware prices are coming down," he told Silicon.com. "So they're persuading customers to pay for power, not the value of the physical item."

But rented capacity is in the customer's interest too - and not just because of the low up-front costs. Weston said: "If we purchase equipment, it has to go on the books with a fixed value, as a BA asset. That becomes a problem when hardware prices drop, because it creates issues about the value of the company."