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Compaq: Life after Alpha

Compaq Computer's announcement to license its Alpha chip technology to Intel signals the end of the line for the chip--once hailed as the fastest on the planet.

Compaq Computer's announcement on Monday to license its Alpha chip technology to Intel signals the end of the line for the chip--once hailed as the fastest on the planet.

Intel will begin channeling some Alpha technology and engineering talent toward its recently introduced line of Itanium processors, and Compaq will turn exclusively to the Intel chip to power its servers--paring down expenses, consolidating its product lines, and beginning a shift to software and services. The Alpha will be no more by 2004.

Originally designed by Digital Equipment, the Alpha was for years considered an example of state-of-the-art technology that few people wanted to buy.

The first Alpha chip shipped in 1992, running at a record-breaking 200MHz. The 64-bit chip was engineered to run multiple operating systems--Unix in addition to Microsoft's Windows NT--and was expected to have a life span of 25 years, according to historical information on Compaq's Web site. Alpha was also the first mass-produced chip to reach a clock speed of 1GHz, back in 1999.

The chip--and servers based on it--won a dedicated core of customers, but it was expensive, and finding software applications to run on the Alpha was a constant struggle for its users. Because of low sales of Alpha systems, Microsoft stopped shipping a version of Windows NT for the chip architecture in 1999.

Compaq acquired the chip as part of its purchase of Digital in 1998. After that, the technology's death was often predicted, as more-popular chip architectures gradually caught up to, and finally surpassed, the Alpha's performance level.

Given the history of the chip, the decision to discontinue it wasn't easy, said Compaq executives. But it was necessary for the company's bottom line. And aside from the cost of maintaining the chip--at least several hundred million dollars per year--Compaq executives said the chip was running out of steam.

"I think there was a growing feeling--not just inside Compaq--that a lot of these RISC (Reduced Instruction Set Computing) architectures (such as the Alpha) were running out of runway," said Mike Winkler, Compaq's executive vice president of global business units. "As we continued to work with Intel...there was a kind of mutual epiphany that said (the Itanium's) really reaching the point where it eclipses the RISC architecture we're using today."

"As you get to next-generation processors with smaller and smaller die sizes," Winkler said, referring to new manufacturing processes, "it becomes more and more expensive exponentially to continue to invest in this architecture over time."

"It was a very pragmatic business decision, and it was very much about price-performance, commonality...scalability...and every customer we've talked to so far has been positive," said Winkler.

Compaq's decision came to a head after the results of an exhaustive study conducted by the company were made available to Compaq brass, according to analyst and company follower Terry Shannon.

"Within four years or less, Compaq no longer would be able to maintain performance differentiation on the Alpha chip," Shannon wrote in the latest edition of his newsletter "Shannon Knows Compaq."

"In light of cost-reduction efforts now underway throughout Compaq, the substantial investment required to develop and deploy future Alpha processor designs became extremely difficult to justify," wrote Shannon. "Hence, the researchers carefully examined a number of 'Life After Alpha' business scenarios."

Translation: Alpha, the chip once hailed as the most advanced on the planet, is now an also-ran.

Compaq realized "the then current Alpha chip--its EV8--would not have a significant performance advantage" over Itanium, Shannon said.

So the company began the long process by which it will phase out the chip.

While it populates its product lines with Itanium processors, Compaq will finish development work on two future versions of the Alpha chip, including its chips code-named EV68 and EV7, which will offer 1GHz and faster speeds.

The Alpha EV68 will be available this summer in Compaq's AlphaServer GS, at speeds of 1GHz, the company said.

Meanwhile, the EV7 is planned to ship later this year at speeds of 1.2GHz and later 1.6GHz, Shannon said. Compaq said it will use the EV7 in an AlphaServer model planned for next year.

While analysts such as Shannon lamented the loss of the once mighty chip, they say that Compaq did help to ease the process: The company notified customers ahead of time, essentially giving them three years before the Alpha is phased out and Itanium becomes the chip of choice.

"All in all, customers should have nothing to fear," Shannon said. "As a longtime Alpha advocate, I'm saddened Alpha is going away." However, "I know some of the very large customers I have talked to are happy."

Shannon expects "there will be a lot of Alpha technology incorporated into (Intel's Itanium) designs." He speculates that Alpha's "glueless SMP" and EV8's SMT, or simultaneous multi-threading technologies, would make their way into future Itanium chips.

Intel's involvement with Alpha goes back to the settlement of a patent lawsuit between Intel and Digital in 1998. As part of the settlement, Intel purchased Digital's StrongARM processor, along with the Hudson, Mass., manufacturing plant where the StrongARM--and the Alpha--were produced.

At the same time, Samsung, IBM and Advanced Micro Devices were granted licenses for the Alpha. IBM now manufactures some Alpha processors for Compaq, while Samsung produces the rest. A marketing organization--dubbed Alpha Processor Inc.--was formed. The company is now known as Alpha Networks and is diversifying its horizons in working with other chipmakers, such as AMD.