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IBM-HP Rivalry Heats Up: Page 3 of 8

IBM now pays a 10 percent commission, up from 5 percent, to certain resellers who get businesses to replace their HP equipment with IBM gear. IBM gives the same cut if it's Sun Microsystems Inc. that's on the losing end.

HP says it considered all the IBM broadsides a compliment. And it, too, offers a commission to sales partners who displace IBM or Sun--15 percent.

"It's not surprising IBM is trying to point their guns in our direction," said Jim Milton, an HP senior vice president in enterprise systems. "It's a testimony to how we're doing in the marketplace."

Zeitler called the commission increase a mere sign of IBM aggressiveness.

"We intend to move as many users as we can to our side, and use every weapon in our arsenal to do it," he said.