The rivalry between IBM and Hewlett-Packard (HP) in Hong Kong's transport sector heightened last week as port operator Modern Terminals announced it was making the switch to Big Blue. This comes as a fresh victory for IBM, which was trumped by HP earlier this year in securing key contracts with the Hong Kong Transport Department and Cathay Pacific Airways. Modern Terminals, a company controlled by Wharf (Holdings), is upgrading its computer hardware set-up from the old, proprietary Digital Equipment platform to IBM's new Unix-based eServer machine, running Tivoli system management software. The deal counted as a loss for HP because Digital's Vax servers were maintained by Compaq Computer, which HP acquired more than a year ago. The project is estimated to cost less than $10 million. 'We needed to quickly settle issues about equipment obsolescence because of our expanding operations, and so we decided to go with IBM,' said David Chow, Modern Terminals general manager for information technology. 'But we are still working with HP in other areas.' The upgrade to IBM's eServer p670, which runs IBM's own Power4+ 64-bit processors, provides Modern Terminals with the capacity to handle an anticipated 60 per cent increase in information processing requirements from its facilities in Kwai Chung Port during the next few years. Modern Terminals managing director Erik B?gh Christensen said the new information technology platform deployment was due for completion by next January. He said it would 'further enhance Modern Terminals' service level when new berths at Container Terminal 9 [CT9] start phasing in'. Mr Christensen said the IT infrastructure would offer additional computing resources to meet the growing demands of customers and business expansion. Mr Chow said Modern Terminals' new and improved IT system, including a storage area network being deployed by Fujitsu Hong Kong, would provide a strong foundation to support the company's mainland expansion programmes. Modern Terminals handles an annual throughput volume of more than four million teu (20-foot equivalent units). On completion of the four berths at CT9 South and improvements to existing port facilities, Modern Terminals will increase its handling capacity to 5.5 million teu per year. The operator started its mainland expansion when its joint venture with P&O Ports won a management contract for Shekou Container Terminals Phase 1 in Shenzhen. It subsequently acquired equity stakes in Chiwan Container Terminal Co and Shekou Container Terminals Phase 2. It opened a representative office in Shanghai last year. Cordelia Chung, general manager at IBM China/Hong Kong, said the Unix-based p670 server would deliver 'the performance and scalability required by Modern Terminals to match changing business needs'. She said the use of IBM's Tivoli management software would provide '99.99 per cent system availability'. Although the deal is a setback for HP, the company has taken large local transport sector deals away from IBM this year. A $100 million project to build, deploy and maintain a new and improved system for recording vehicle and driver data in Hong Kong was bigger than a US$4.7 million services project IBM obtained from the Transport Department earlier this year. HP also landed a three-year contract in April to manage and revamp Cathay Pacific's Web services infrastructure. The deal broke new ground for HP's services business in Asia because the airline has long been an IBM Global Services customer.