Dell Building Data Center Container

Dell Inc. (DELL) is building a data center in a shipping container for a customer, and will follow with a container product line. "We have (a container system) in the works for a customer," a Dell insider told The Register. "We are looking at that space very, very closely." The Register's Ashlee Vance said it appears Dell has "geared up a container for Microsoft's late April RFP."

The "data center in a box" concept has been embraced by Microsoft, which plans to pack between 150 and 220 40-foot containers into the first floor of its new Chicago data center. Microsoft executives say the new facility will house up to 300,000 servers.

Dell joins a growing herd of hardware vendors offering container solutions, including Sun Microsystems (JAVA), Rackable (RACK) and Verari Systems all report strong interest in their container products. Last month IBM said its new iDataPlex series of cloud computing servers is being offered in a 40-foot trailer, marking IBM's first foray into container-based systems.

Why are all these server companies targeting the container market? Sales of conventional servers have slowed recently, in large part due to the growing use of virtualization to consolidate data centers and get more mileage out of every server. As enterprise companies improve their capacity utilization, they're buying fewer new servers.

At the same time, Web 2.0 apps and cloud computing have emerged as an important market for bulk server sales, as noted recently by Gartner. "Sales of servers in the Web 2.0 and high-performance computing (HPC) niches are outpacing those in the general server market," the research firm wrote. "These two segments currently have unique requirements: Purchasers want the lowest-cost, lowest-overhead server, but with the most efficient power management and cooling."

Dell has had a Cloud Computing Solutions business for two years, and recently launched In The Clouds, a blog dedicated to "condensing ideas on the future of cloud computing."