I think the problem isn't "unsexy", but service and scale.
Buyers of rackmounts require a totally different kind of service. It's not just about the iron, it's a largely separate operation from the consumer PC business. You don't exactly take your Xserve to the Genuis bar...
There simply isn't enough demand for Xserves to make it worth the investment for Apple. (As far as I remember, many companies that bought the original Xserves phased them out again because Apple couldn't deliver that kind of service.)
Also true. Apple is not a server company, and they never will be.
I try to lean on vendor support as little as possible, because it does me no good to point a finger at a vendor when something goes wrong -- I just want it fixed, even if I have to do it in-house. But you still need someone to go back to when push comes to shove, and I just don't see Apple being set up for that kind of support.
In fact, Apple isn't even set up for the kind of purchasing that goes along with it. They're a really old, staid organization when it comes to the sales structure. We wound up going with a VAR rather than direct, simply to improve the experience.
Buyers of rackmounts require a totally different kind of service. It's not just about the iron, it's a largely separate operation from the consumer PC business. You don't exactly take your Xserve to the Genuis bar...
There simply isn't enough demand for Xserves to make it worth the investment for Apple. (As far as I remember, many companies that bought the original Xserves phased them out again because Apple couldn't deliver that kind of service.)