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AMD aims to triple server share

The CIA's among its latest customers, but the chipmaker still needs help from big computer makers.

SAN FRANCISCO--Advanced Micro Devices will try to nearly triple its market share in its server segment by the end of the year through high-profile customer wins and tighter relationships with manufacturers.

The Sunnyvale, Calif.-based chipmaker aims to be in 10 percent of the so-called x86 servers by the end of the year, said Ben Williams, vice president of the server/workstation microprocessor business unit, in an interview Tuesday at LinuxWorld Conference and Expo. Earlier, the company's goal was to account for about 6 percent to 7 percent of the x86 servers shipped by the end of the year, he said.

In the first quarter, AMD chips were incorporated in about 3.5 percent of the servers shipped in this market. Overall, the company accounts for about 6 percent of the processors shipped into this market, but since servers often contain two or more processors, there is a difference between the number of chips shipped into the market and the number of servers shipped that contain a company's chips.

If successful, AMD could become the second-largest provider of server microprocessors, as x86 servers now account for around 90 percent of the servers sold.

The growth is largely due to the popularity of the Opteron processor. Sabre, the travel conglomerate, and VeriSign have begun to install servers based around Opteron, Williams said. The CIA, various government agencies and a Chinese supercomputer company have also adopted the chip.

While many Opteron servers contain one to two processors, four-way systems are growing in popularity. Tyan, the Taiwanese motherboard maker, is helping the process along with a four-processor motherboard that sells for less than $1,000, he said. Processors based on the 90-nanometer process will come out in the current quarter, and dual-core chips will start shipping to manufacturers in the middle of next year.

For AMD to meet its market share goals, however, will depend on whether it can strengthen its alliances with the top four server makers. IBM, Hewlett-Packard, Sun Microsystems and Dell account for around 70 percent of server sales, Williams acknowledged. AMD has links with all of them except Dell, which is testing the chip but not committed to releasing products.

"We know their (Dell's) customers are asking for it," Williams said. HP will include Opteron in its blade lineup in the fourth quarter, he added.

Potentially, the company could also benefit from problems Intel has had with PCI Express, an input-output technology in its new server chips. Intel recently recommended that customers not use PCI Express yet. AMD's competing technology, Hypertransport, has been in the market for over a year and has not encountered significant problems.

"For them (Intel) not to be able to deliver, it is surprising," he said. "It would be like us not to be able to bring out Hypertransport."

AMD, however, has had to contend with the delay of Microsoft's version of Windows for 64-bit x86 chips. Opteron is the oldest and most established 32/64-bit chip on the market, which means the chips can manage data from larger pools of memory than conventional 32-bit chips. This version of Windows, however, won't come out now until the first half of next year.

Intel also has a server chip that can perform the same functions; the first servers based on this chip became available this week.

Williams, though, noted that 64-bit versions of Linux are already out and that Opteron sports other enhancements.

"Whether 64-bit is there or not, it doesn't slow down the adoption a bit," he said.