Likewise, network scalability, security and availability become so critical to a firm's health that there's almost no room for error. Ten years ago, the placement of servers everywhere and anywhere was considered the best way to achieve high performance and computing availability. Nowadays, corporations are taking advantage of better networking gear, lower costs for high-end components like switches and administrative tools that manage a small number of servers in central locations. Server consolidation doesn't necessarily mean that large enterprises are less hungry for hardware, only that their tastes are changing. The worldwide server market continues to grow, even as other high-tech sectors have been bottoming out.
Companies start down the consolidation trail to reduce costs.
Consolidation can also make networks more manageable. Programs like HP's venerable OpenView, Computer Associates International Inc.'s Unicenter TNG or Tivoli Systems Inc.'s TM give administrators centralized control panels to keep servers and networks running at optimal speeds by monitoring performance and, in some cases, reallocating resources to break through bottlenecks. Reducing the number of servers that a company runs also helps minimize the demand for scarce IT expertise. Instead of needing multiple systems managers, companies can operate with a handful of administrators at IT headquarters. This makes it technically appealing to do a consolidation.