Some analysts expect Intel to demonstrate 64-bit features in the Pentium 4 and the Xeon chip for low-end servers later this month at the company's biannual conference for software developers.

Perhaps more significant, Advanced Micro is pricing the new Opteron chips to compete against Intel's 32-bit Xeon processors, which are now widely used in the market for low-end corporate servers.

Hewlett-Packard wants to merge with Compaq to build strength for a fight with Dell in PC's and low-end servers and with I.B.M. over high-powered computing and consulting services.

In desktop systems and low-end servers, the processor is often the most expensive component (or second most expensive, behind the video card), and can easily be 25-30 percent of the total system cost.

AMD has also released Socket 939 Opterons, reducing the cost of motherboards for low-end servers and workstations.

But we found there were certain pieces that weren't being done very well by the group - the protocols and low-end servers.

The company also introduced the PS/2 Model 65 SX, a low-end, tower-style server that uses a 16-MHz Intel 80386SX chip.

Data General, hosts to a lively Scottish Open Systems Conference at Ibrox Stadium in Glasgow last week, marked the occasions with price cuts of around 25% on its low-end servers.

Between the slimline deskside 400 series and the 240 desktop machine comes a new Level 300 series of low-end servers designed in conjunction with ICL parent Fujitsu Ltd.

"They are right to broaden the definition of the market beyond the low-end servers because all servers compete against each other," Mr. Doherty said.