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IBM has thrown Dell the gauntlet over small-business users today by launching a System i server configured for customers with 100 seats or fewer of SAP’s business management software.

To attract those users, announced IBM, the IBM System i 520 Solution Edition is attempting to out-customize Dell’s PowerEdge server, offering more security, virus protection, database and storage. IBM aims to attract small businesses with the product, pitching the idea of managing the entire company’s data in a single spot, whether accounting, supply chain, CRM, e-mail or disaster recovery.

Theoretically, IBM’s move also marks a win for SAP in the competition for those same users against Oracle’s J.D. Edwards ERP software.

In July, IBM started selling a nearly identical product for Oracle applications called the System i 520 Solution Edition for Oracle’s J.D. Edwards EnterpriseOne. That platform was a critical bit of Oracle’s campaign to keep the 5,000 PeopleSoft users, users form a company Oracle swallowed in January.

Industry pundits see Now Oracle must share IBM’s fast hardware and aggressive pricing with its bitter rival. Says online industry journal “CIO Tech Informer," “The two companies are locked in a public war of words and product launches. In July, SAP said it had explicitly designed its pending Safe Passage 2.0 migration program to win over Oracle users. And Oracle sells a product called ‘OFF SAP,’ which includes credit incentives for switching from SAP.”

IBM plans to release the i 520 Solution Edition in October for US $35,000.