IBM on Wednesday introduced a blade chassis that the company described as an easily managed system of preinstalled integrated applications and storage for small and midsize businesses.

The BladeCenter S is designed to simplify IT management and reduce the number of servers needed to run applications most commonly used in business, such as antivirus and firewalls, voice over IP (VoIP), e-mail, collaboration, backup and recovery, and file and print. IBM claims the new product is capable of reducing the 25 to 45 servers used by an average midsize company to as few as five blade servers in one chassis.

Blade servers slide into the slots of a chassis, where they can be managed as a whole rather than separately. The configuration also reduces power consumption, when compared to server farms, and uses up less space. IBM led the worldwide blade server market last year, followed by Hewlett-Packard, according to Gartner.

The six-slot BladeCenter S can sit on a desktop and plug into a standard 110-volt power outlet. The system is designed to minimize IT administration by offering a wizard-based installation interface similar to setting up a home PC and a management tool with select-and-click configuration. "It's the closest thing to a plug and play mainframe that any IBM division has ever shipped," said Richard Doherty, analyst for the Envisioneering Group.

Along with SMBs, which IBM defines as 1,000 employees or fewer, the new product could appeal to large retailers or financial institutions with stores or offices distributed over many locations. An IT department in a central retail office, for example, could set up a BladeCenter S, and then ship it to a store where it could be easily deployed. If an application needed to be replaced later, than the IT department could ship a new blade for swapping out the old one.

The new product represents a change in attitude toward blade servers, which were originally designed for server consolidation in large businesses. Blade chassis are capable of integrating servers, storage, networking, and applications into one system.

These days, this versatility is finding a place elsewhere. "This concept of having a data center in a box has appeal for smaller businesses and distributed retail," Illuminata analyst Gordon Haff said.

In building the BladeCenter S, IBM has designed a new chassis that uses the same components found in IBM's other systems for larger companies. "It uses what they have, but optimizes it for smaller locations," Haff said. "It's a right-sized box for small installations."

IBM and HP account for more than 80% of the blade server market, leaving little room for other vendors. As a result, rivals like Dell, which also offer blade servers, are marketing rack servers as an alternative that could be less expensive to install in a data center than a blade system.

For the high end of the blade-server market, IBM offers the BladeCenter H system, which the company upgraded in January. Pricing for the BladeCenter S was not disclosed. The system is scheduled for release in the fourth quarter.