CIO — Virtualization is great and all, but sometimes a customer just wants their own server. For many companies, however, off-the-shelf servers are too big, too powerful and too hot—making the typical data-center fare too costly.

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It's a problem that faced Dell's in-house skunkworks, the Data Center Solutions (DCS) group, last year. Their solution? Build a compact server based on the Via Nano processor -- a low-power, low-cost chip found in increasingly popular netbooks, says Todd Brannon, market development manager for Dell's DCS. The mini-server, known as the XS11-VX8 or Fortuna, almost fits in a 3.5-inch floppy case and requires a fraction of the power of a typical enterprise server.

"The servers we typically build for our mainstream IT customers are too much for these applications," Brannon says. "What we are finding is that the hardware requirements are very different for these massive 'hyperscale' environments."

While Brannon is quick to stress that the server is a custom design only suited for a limited market, Dell is not alone in pursuing the low-power market.

In February, Microsoft showed off a data-center cabinet filled with netbook processors that could be run using a standard AC outlet. The company demonstrated the solution to hardware makers as a possible solution to cut back on energy consumption in data centers.

The problem for many companies is that server performance, and power consumption, has leaped ahead in the past five years, improving by a factor of 11, according to Dell's Brannon. For companies that make heavy use of virtualization, the gains mean more efficient computer resources. However, for customers who want to host a single application on a single server, today's run-of-the-mill servers are too high-powered.

"If you are a managed hosting company, the workloads on those servers have not gone up 11 times, so they have a problem that, if they buy an enterprise-class system, they are way over-provisioned," Brannon says.

Dell fit 12 Fortuna servers in a 2U rack, allowing for a higher density of servers per data-center cabinet, without appreciably increasing the power consumed.

"This feels like a good fit between data-center companies and outsourcing," says Martin Reynolds, vice president of emerging trends at analyst firm Gartner. "This will be a very cheap way for, say, Amazon to offer people individual servers. If you are running something simple, this will be fine."

In many cases, the hosting provider continues to use a virtualized environment even if only a single customer is on a specific server, Brannon says. The idea, called one-to-one virtualization, is to allow the customer to have a dedicated server but give the hosting provider the benefits of virtualization, such as easily backed-up configurations and simple restoration of the data.

While hosting providers are the main focus of Fortuna, which is such a specialized product that you won't find it listed on Dell's Web site, other companies could use such low-powered servers as well. Oil-exploration and drug companies that use a lot of high-performance computing clusters could use a passel of the mini-servers to create a grid of low-cost computers that could be scaled bigger or smaller as necessary.

In addition, the power of the small-form servers will likely be tweaked to attract a larger group of customers, argues Gartner's Reynolds.

"The first step in making servers much smaller," Reynolds says. "It won't be very long between someone says that I like the idea, but they want more powerful processors, and pretty soon you will have these things loaded with Nehalem chips."

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