Steve Jobs says hardly anyone was buying the Xserve

Just as well... We're dumping our 3 xServes because they are inefficent. We gave them 3 years and all we got were mounting bills. SMB is still shot, Web service doesnt work if youre trying to host 2 seperate websites (like, say, an Internet and an Intranet site), Open Directory works fine, if all you use is Apple Services. Mail is way too basic (thou it did get better in Snow Leopard)... about the only thing I can say that was good was ARD. but only because i had to use it 99% of the time. When we had our windows server initially, the only interaction i had with it was its weekly reboot. the xServes failed on me way more often.

If apple had actually taken the time to get things right, it might have been a better story. But our IT costs quadrupled AFTER the hardware was purchased and Apple Enterprise set everything up. We never got stable, just workable.

I dont really have a huge problem with the axing of the hardware but do want to know if there will be a new OSX server edition... Because The mac Pro's def have enough to put the OS on there in my opinion.

There are few, if any, compelling differences between Apple's XServe hardware and it's competition in the data center. The server software can be compelling for small workgroups (creatives, scientists, etc.) who can place a machine in a closet and who find the Server GUI to be a time saver but not to those many IT folks who need more control than the server GUI provides. MacOS X Server is largely based upon open source applications (Apache et. al.) so there is very little differentiation there either. Podcast Producer is probably the only major app in the suite that isn't interchangeable with an open source title.

Overall, then, MacOS X Server is a hard sell no matter how you slice it.

I am currently imagining a server rack system that accepts Mac mini servers like server blades. That would be so very amazing.

A blade server to replace a 1U server is ridiculous. A blade server requires a chassis to seat into. The cheapest blade Dell M610 blade (middle line range) is just under $4000. The M-Series chassis for it to plug into is about $5000. If you are deploying a chassis fill of blades for a virtualization or performance cluster, it may make sense. But if I just need two or three standalone servers to meet my need, blades immediately looses their appeal from a cost perspective. Also, Apple would need to do a 180 degree turnaround on how it handles product roadmap disclosure. My employer needs to plan over 1 year ahead and these day of announcements that Apple is famous for do it no favors when trying to get integrated into enterprise IT planning. I'm an Apple fanboy by all definitions, but their enterprise business sucks.

And you know a Apple blade system would cost more than it similarly priced competitors.

Jobs on the enterprise market...
http://www.youtube.com/watch?v=1srU6Z77jfc

What is Apple going to use to power their cloud computing initiatives?

I think this is another indicator that Apple doesn't take Enterprise computing seriously.

If the XServe market is peanuts to Apple (as implied by Steve's email) then Apple shouldn't block people from installing OS X Server on VMs. That would take away all the pain for everyone who is hurting from this announcement.

My point, if it's an irrelevant market due to its minuteness, then open it to VMs, it wont' hurt the bottom line or Apple's image.

The XServe is available until the end of January, which is three months away. Why announce its EoL now? Enterprise and education have long gestation periods on hardware purchases. They need to know their options this far in advance.

As to the XServe replacement, if there is one, I'm on board with the Blade theory. It makes perfect sense for so many reasons. However, if this is the next step they'll need to get a product announcement out in the next few weeks.

"williamt said 10:58AM on 11-08-2010

Do we yet have any idea what hardware Apple are filling the racks of the much heralded North Carolina data centre with? Their own?"

Hackintosh severs?