New Intel chip lifts high-end servers

The company on Tuesday launched the Xeon MP processor, its latest chip for multiprocessor servers using four or more chips. The new Xeon MP chip offers nearly twice the clock speed of the chip it will replace, the 900MHz Pentium III Xeon chip that it introduced a year ago.

Xeon MP, to debut at speeds of 1.4GHz, 1.5GHz and 1.6GHz, gets its extra performance from Intel's NetBurst processor architecture, the same silicon that is behind the Pentium 4. However, the Xeon MP also packs a few server-oriented enhancements, including an on-chip Level 3 cache of up to 1MB, and Intel's hyper-threading technology, which allows a single chip to nearly mirror the performance of two. The cache stores important data closer to the processor core, speeding performance.

Intel debuted the new processor at the CeBit trade show in Germany.

Xeon MP will also usher in the use of a new chipset from Serverworks that supports larger amounts of higher bandwidth, double data rate SDRAM as well faster internal communications thanks to support for PCI-X, a faster version of the PCI bus used to connect components such as add-in cards inside a PC or server.

The higher clock speed and memory will help new Xeon MP servers offer as much as a 40 percent performance improvement on applications such as online transaction processing, compared with the Pentium III Xeon with 2MB of Level 2 cache.

Santa Clara, Calif.-based Intel also recently upgraded its Xeon processor for single- and dual-processor applications, dubbed Prestonia, to 2.2GHz. That chip is aimed at workstations and servers with one or two processors. Such servers are generally less expensive and are used for more mundane tasks such as storing files. Dell Computer, for example, plans to use the new 2.2GHz Xeon in its PowerEdge 4600 server.

Meanwhile, the new Xeon MP will take its place in much more expensive four-way or eight-way servers that are used for a wide range of applications, from e-mail systems to e-commerce transactions.

The chipmaker believes that companies will step up to new four-way Xeon servers because of the performance they deliver for the price. Servers based on the new chip should cost about the same as current Pentium III Xeon servers, according to Intel.

A basic Dell PowerEdge 6450 server, for example, starts at about $7,000 with a 700MHz Pentium III Xeon and 1MB of Level 2 cache. When fitted with four 900MHz Pentium III Xeons with 2MB of Level 2 cache each, 2GB of SDRAM and twin 18GB hard drives, the server increases in price to nearly $28,000.

"We think that the net result of all of that to the CIO or the IT infrastructure is...that they get more for their dollar," said Lisa Hambrick, director of enterprise processor marketing in Intel's Enterprise Processor Group.

Other manufacturers, such as IBM, plan to use the Xeon MP in more heavy-duty servers. IBM is expected to offer the Xeon MP in its x360 server. The x360 was designed to bring mainframe-like qualities to a less expensive machine based on Intel hardware. The server will be able to combine up to four four-processor modules to create a 16-way machine.

Unisys also plans to use the Xeon MP chip in its 32-way ES7000 server. The ES7000 also takes on certain mainframe qualities. For example, it can be divided into several independent partitions, each with its own operating system.

Hewlett-Packard, as part of a refresh of nearly its entire product line, announced a new Xeon MP server as well. Its new tc7100 server will sell for an average price of $12,559 and offer up to four Xeon MP chips.

Challenges ahead

Though servers are big business for Intel and many hardware makers, the volumes of chips and machines sold are much lower than those for the PC market. Additionally, revenues for the server market declined by 19 percent in 2001 because of the slow economy and the dot-com bust.

But that won't stop Intel. Although it doesn't sell nearly as many Xeon chips as it does Pentium 4 or Celeron chips for PCs, Xeon is still an important product for Intel. For one thing, the chip commands higher prices than the Pentium 4 or Celeron chip.

Intel believes that many companies will consolidate the duties of several servers onto one or two four-way machines, which could support e-mail systems, large databases, transactions for e-commerce or supply-chain management applications that track inventory.

Servers are "a very worthwhile market for Intel to be involved in," said Dean McCarron, an analyst at Mercury Research. As a chipmaker, "You don't want to stop at, say, uniprocessor, and leave an opening for the other guy above that."

Intel sold about 120 million chips in 2001, according to Mercury. Total Xeon shipments for all servers and workstations represented about 2 percent of those, or a "couple million units per year," McCarron said.

Despite the new chip, companies won't just run out and buy a four-way server. Most companies are conservative when it comes to adopting new server technology, even if they buy the newest PC processors, because of the higher cost and effort involved in procuring and maintaining a server.

Even some of the server vendors themselves will bide their time, as the new chips are relatively untested. Though glitches are rare, they do crop up from time to time. A bug in the 900MHz Pentium III Xeon's Level 2 cache, for example, caused Intel to pull that chip for a time.

Intel said it will work with customers to determine how long to continue to offer the Pentium III Xeon chips.

Intel lists the prices on the new 1.4GHz and 1.5GHz Xeon MP chips, both with 512KB of Level 3 cache, at $1,177 and $1,980, respectively, in 1,000-unit quantities. The 1.6 GHz Xeon MP with 1MB of Level 3 cache lists for $3,692 in 1,000-unit lots.