Taking the stage at the Spring Comdex conference in Chicago, Silicon Graphics chief executive Rick Belluzzo demonstrated the company's Intel-based Visual Workstation and plugged the company's workstation products as a way to increase productivity by visualizing designs and data. Lately, SGI has been promoting its server computers more heavily.
As an example, SGI showed off its data-mining software as a tool to pick apart the spending habits of telephone company customers, for purposes of finding out which customers should be prized and which are best left to rivals. "You can identify relationships that you wouldn't ordinarily think about" by using high-powered visualization software to view data graphically instead of as lists of numbers and text, Belluzzo said.
Also today, SGI announced a processor upgrade for its low-end Unix workstation, the O2, which now will be available with the new R12000 processor and a base price of $10,495.
Visualization and high-end graphics gives SGI "a unique advantage" in the computer marketplace, said Peter ffoulkes, an analyst with Dataquest. But the company is in a tight corner right now as it tries to pull itself into profitability.
SGI is a company dealing with two transitions at the same time: the move to add Intel chips into its product line and the move to reposition its products for the growing server market. It's been a rocky road, however, as the company recently warned analysts to drop their loss projections even deeper into the red.
Trying to de-emphasize the company's association with graphics, the company dropped the "Silicon Graphics" moniker last week in favor of the SGI acronym.
While some analysts have lauded the server push, others note that the market is already crowded with the likes of Sun Microsystems, Hewlett-Packard, IBM, and Compaq, and that SGI might be better off playing to its graphics strengths.
After publicizing its Intel-Windows NT Visual Workstations for months, it's good that the company has returned some focus to its earlier product line, Unix-based workstations, ffoulkes said. The new processor is pin-for-pin compatible with the older R10000 chip, meaning that current customers can drop it into their existing systems, he said.
"The most important thing is that there is now a road map" to the next-generation R14000 chip and beyond, ffoulkes said. SGI's Unix workstations once appeared to be a two-year-old products with nowhere to go, but "suddenly they have a future again," he said.
The R12000 chip, running at a clock speed of 300 MHz, replaces the 250-MHz R10000 in today's O2 machines. The new chip gives a 28 percent performance boost in some tasks, such as in using the Dassault Systemes' Catia mechanical computer-aided design (CAD) program, said Geoff Stedman, marketing manager for SGI's workstation division.
The earnings warning less than a month ago was the result of SGI's inability to ramp up production of its Visual Workstation 320 and difficulties getting the R12000 chip into SGI servers, the company said.
"There was a bit of a learning curve" for SGI and its Visual Workstation manufacturer, SCI Systems, Stedman said. "Bringing ourselves up to speed from a production standpoint is one of the things we've had to work on most hard recently," Stedman said.
SGI is showing its higher-end Visual Workstation 540 and will release the machine later this quarter, Stedman said. The 540 is more expandable and can use as many as four Pentium III Xeon processors, but it has the same graphics engine as the 320.
The higher number-crunching performance of the 540s is useful for programs such as financial analysis or graphics rendering, he said.
Although Linux boots on the Visual Workstations and will ship on the company's Linux servers later this summer, SGI doesn't plan full Linux availability anytime soon, Stedman said. "We're not yet ready to go out with how we're going to proceed in the [Linux] marketplace. We haven't yet seen the broad migration of applications on the desktop to Linux," he said.
However, he added that the company is monitoring the software closely. "We're having conversations with different software vendors to find out what their plans are. As we see opportunities, we'll bring our technology into that space."