Reliance Computer plans name change, IPO
The designer of chipsets for servers is making inroads against Intel and will rename itself next week as part of an effort to become a higher-profile company.
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Reliance's new name remains unknown, but one leading candidate is Serverworks, said sources close to the company. This would fit with the company's plans to sell chipsets--a crucial piece of computer silicon--that are specifically designed for servers. RCC has registered the domain name "www.serverworks.com." A company spokeswoman confirmed a name change was coming but declined further comment.
The switch reflects deeper changes at the company, including new products, a Web site and a plan to hold an initial public offering this year.
"I've been very impressed," said Insight 64 analyst Nathan Brookwood. "They've been off the radar screen. They're now coming on with a very strong blip."
RCC is one of several companies that has had success displacing the once-dominant Intel in supplying chipsets, the collection of chips that handle communication between a microprocessor, memory, hard disks and other computer components. RCC won a place in the server product lines of the biggest sellers of Intel-based servers: Compaq Computer, Dell Computer, Hewlett-Packard and IBM.
Intel began expanding from microprocessors to chipsets in the early 1990s. The migration gave the company greater control of the overall computer design and made it easier to introduce features such as the AGP graphics card slot or Rambus memory technology.
Selling chipsets also meant that Intel ultimately garnered a larger fraction of the revenue earned on the sale of each PC or server. Although they cost far less than microprocessors, chipsets have been a profitable segment for Intel. The company controls at least 80 percent of the market for chipsets compatible with its processors.
In a way, however, Intel is becoming a victim of its own success. As Intel central processing units (CPUs) have spread beyond just desktop PCs to servers and workstations, room has opened up for other companies to offer more specialized products.
Via Technologies, for instance, came out with a chipset adopted by Micron that provided faster connections to memory and graphics at the same time Intel was stumbling with its 820 chipset, the first to enable use of the Rambus memory technology. Via got into the Intel-compatible chipset business through a licensing deal with Intel. The matter is now the subject of a number of lawsuits.
AMD's move into commercial computers is also presenting the specter of competition. HotRail, a company formerly called Poseidon Technology, is developing a chipset for making servers with eight AMD Athlon processors. The HotRail chipset will basically build a miniature Fibre Channel network into the computer to connect the chip, memory and peripherals with high-speed links.
Intel's product plans also have not always been popular with computer makers. The company, for example, laid out plans years ago to create chipsets that would work with Rambus memory and effectively use these chipsets as its standard for high-performance desktops.
The Rambus push was delayed several times and prompted some typical Intel allies to not adopt Rambus memory or Intel's matching 820 and 840 chipsets. HP and Intergraph, for example, both selected chipsets from RCC instead of Intel for their high-end workstations, because conventional SDRAM shows better performance, not to mention lower cost, with large amounts of memory, the companies said. IBM, among others, chose not to adopt Rambus and the Intel chipsets in its consumer PCs.
Rambus hasn't been adopted in servers, but it hasn't been targeted heavily at that market yet either.
"I think (RCC has) provided us some great technology here," said Dave Buckley, product marketing manager for HP's technical computing division. "We're seeing a performance boost over and above the 840 at same clock speed with (Rambus memory)," he said.
Some analysts agree. Rambus is "just cleaning up with their support for more conventional memory technologies," Brookwood said.
Intel is by no means down for the count. For servers with eight Intel processors, the company sells its Profusion chipset, based on technology obtained when Intel acquired a company called Corollary. And Intel's NX chipset is used in many four-processor server designs.
But Intel acknowledges it missed out on chipsets for two-processor servers.
"We missed a design cycle," said Paul Otellini, general manger of the Intel Architecture Business Group, in an earlier interview. Intel was concentrating on the Profusion chipset, he said.
RCC prefers to call chipsets for servers "serversets," arguing that the chips for servers are sufficiently specialized to deserve a name of their own. The label also likely indicates an effort to raise the silicon from its current relatively obscure status into a product customers recognize and even seek out.