Allies pledge $10 billion to boost Itanium

Cash from Intel, Hewlett-Packard and seven other companies will be spent on pushing the delay-prone high-end chip.

Stephen Shankland principal writer
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Stephen Shankland
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SAN FRANCISCO--Intel, Hewlett-Packard and seven other server companies will spend $10 billion through 2010 to try to increase adoption of the Itanium processor.

The money is coming from Intel and HP--Itanium's co-developers and top backers--as well as from Unisys, Silicon Graphics Inc., NEC, Hitachi, Fujitsu, Fujitsu-Siemens and Groupe Bull. The companies said Thursday that they will spend the money on research and development, marketing, and work to help software companies support the high-end processor.

"Itanium has been taking share from both IBM power and Sun Sparc. We're on the right trajectory, but we want to go faster," Tom Kilroy, general manager of Intel's Digital Enterprise Group, said at a press event here. "The $10 billion investment is a statement that we want to accelerate as a unified body."

The companies are members of the Itanium Solutions Alliance, which includes Microsoft, Red Hat, Novell, Oracle and other software companies. The alliance also announced its Itanium Solutions Catalog, which describes various combinations of hardware and software for specific tasks.

Itanium, a high-end processor, was once expected to sweep the server world. But because of delays, initial performance issues and software incompatibilities, Intel has had major difficulties getting Itanium to catch on. Most recently, the first dual-core model, code-named Montecito, was delayed from 2005 until mid-2006.

Kilroy made it clear why Intel is pushing so hard to give Itanium a stronger future.

"This is a $140 billion opportunity on hardware. It's dwarfed by the opportunity in software and services on top of that," Kilroy said. "There's a reason there's $10 billion of investment in play."

SGI, a relatively small company that concentrates on the high-end technical computing systems, expects to benefit from the strength-in-numbers argument behind the alliance.

"The Itanium Solutions Alliance is useful for us," said Greg Estes, vice president of global marketing, in an interview. "If you're a company like ours, you try to stake out ground to be the high-performance player in the marketplace. If you can do that with a robust ecosystem underneath that, that doesn't feel esoteric--high-performance systems with something that feels like it has some weight on it so you're not just betting on SGI alone--that's a better story for customers."