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Analyst firm offers rosy view of Itanium

Despite delays and other problems, an IDC survey shows Itanium server perceptions to be "quite positive."

The Itanium processor has had a rocky debut in the more than 11 years since Intel and Hewlett-Packard first announced the chip alliance, but a major analyst firm says things are looking up.

Itanium market awareness is high, not only among the HP server customers who would be expected to know of the processor but also among others, according to a February report from IDC based on a survey of 501 computer system managers at U.S. companies with at least 200 employees.

"Given the colorful history of product development and the slower-than-expected ramp of Itanium server sales, we had frankly expected that awareness of the platform would be spotty and that customer consideration and intent of purchase would be very low. In fact, we found just the opposite," IDC said. "The current market perceptions of Itanium-based servers are quite positive."

The favorable assessment is a spot of good news for a chip family that has been plagued by troubles, including the 2005 delay of its newest model, code-named Montecito. The chip family was expected to sweep the computing landscape, but instead Itanium's difficulties have illustrated what can go wrong when introducing a brand-new design.

As Itanium expectations were pared back over the years, in part because of the success of x86 chips such as Intel's Xeon, .

Despite the woes, IDC sees a relatively rosy future of growth. Customer spending of about $2.4 billion on Itanium servers in 2005 should increase to $6.6 billion in 2009, according to the report.

Over the next five years, nine Itanium allies are sinking $10 billion into work to develop Itanium products and lure software companies to support the chip. The positive perception of the chip for server tasks is a good foundation for the work, IDC said.

Today, HP holds the lion's share of the Itanium server market--nearly 70 percent--but that should even out with the Itanium Solutions Alliance work, IDC predicted.

However, there's still work to be done in Itanium awareness.

HP is using Itanium to gradually replace its in-house chip, PA-RISC, the last model of which HP introduced in 2005. But about 13 percent of HP-UX customers still aren't aware of Itanium, IDC found, and 29 percent weren't aware that PA-RISC was being phased out.

Among other results of the survey:

• About 24 percent of the survey respondents have installed an Itanium system--30 percent among HP customers and 13 percent among non-HP customers. Attracting a broad customer base, in particular customers outside HP, is critical to ensuring broad support by software companies.

• About a third of respondents expect to purchase an Itanium server in the next 12 to 18 months.

• Among PA-RISC server customers, 65 percent plan to move their systems to Itanium systems, most likely within two to three years.

•  Among the PA-RISC customers not planning to adopt Itanium, systems with Intel's Xeon processor are the most likely alternative, expected to be used in 38 percent of cases. Sun Microsystems' Sparc and Advanced Micro Devices' Opteron are tied in next place with 25 percent each. IBM's Power processor family is the expected alternative in 11 percent of cases.