The third member of the Itanium chip family, announced Monday, is the company's best shot to date at taking on Sun and IBM in the market for high-end server processors.
Madison, the third member of the Itanium chip family, is Intel's best shot to date at taking on Sun Microsystems and IBM in the market for high-end server chips. If the Santa Clara, Calif.-based chipmaker succeeds with its ambitious plans, the higher end of the $43 billion server market will be remade around Itanium the way the lower end now centers on Intel's Xeon chips.
The chip debuted Monday under the Itanium 2 name, along with new versions of the Xeon processor for midrange servers. Madison offers roughly 50 percent better performance over its most recent predecessor, according to Intel, and is already rated highly against the best chips audited benchmark tests.
But just as importantly, Intel and its allies have finally begun attracting broad support from server makers and the software companies. By the end of the year, there will be more than 50 different Itanium 2 systems on the market.
Similarly, the software customer base is expanding. More than 400 programs, including Windows, SAS Institute's business analysis software, SAP's accounting software, and Oracle's 9i database software, have been ported to Itanium 2. Customers using Itanium 2 in pilots or for actual work include Sun America, Agilent Technologies, British Petroleum and BMW.
"It is gaining momentum. Intel is saying, 'We are committed to a road map, and we are improving every year, and we are powering through this with our marketing and manufacturing muscle,'" said Kevin Krewell, senior editor of the Microprocessor Report industry newsletter. "The most important thing was that they got a production release from Microsoft for a 64-bit version of Windows."
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All high-end server chips today are 64-bit designs which, compared with 32-bit chips, can handle vastly more memory gracefully and can perform some tasks, such as encryption, more efficiently. Software designed to run on 32-bit chips, such as Intel's Xeon processors, must be rebuilt to take advantage of 64-bit features, and for Itanium, the software change was much bigger than for its competitors. Intel has argued that the sweeping change was required to create a new architecture that would last 20 years.Madison, like all Intel products, is named after a geographic place, a process that avoids potential trademark infringement potholes. Madison was named after a river that runs through Wyoming and Montana and symbolized "something that had a long reach and touched a lot of things," said Intel spokesman Seth Walker. Its predecessor, McKinley, was named after North America's tallest mountain. Winning support
Intel has coaxed two key server makers into the Itanium camp. IBM, the top dog of the server market, introduced its x450 Itanium server on Monday.
And Dell will release an Itanium 2 server, a strong endorsement given the company's preference for established markets and its past record with Itanium. The company released, but then quietly killed, a workstation based on the first Itanium and skipped the first Itanium 2, stating that there was zero demand.
HP is using Itanium to gradually replace its own PA-RISC processor. Mark Hudson, head of marketing for the company's server group, said the company expects revenue from Itanium systems to exceed that of PA-RISC in 2005. In part, that's because Itanium will run not just the company's version of Unix, called HP-UX, but also Windows and Linux.
"We're getting dozens of new customers coming to the Superdome platform that we are seeing for the first time because of the Windows play," said Brian Cox, worldwide product line manager for HP's Business Critical Systems group. All three operating systems should be available by the end of September for Itanium, Hudson said.
By the end of 2003, enough software companies will have Itanium versions to cover the businesses that today account for 85 percent to 90 percent of HP's PA-RISC revenue, Hudson said.
If Madison becomes a watershed product, Intel will be ready to quickly capitalize on the momentum. Deerfield--a low-cost, energy-efficient version of the chip--will come out in the second half of the year for two-way servers as will a version of Madison specially designed for servers in clusters.
A faster version of Madison with more cache will then debut in 2004. Montecito, an Itanium with two different processors in the same piece of silicon, will come out in 2005. In the middle of the decade, Intel is planning on coming out with another Itanium that will blend many of the features of the highly touted, but never released, Alpha EV8 chip conceived first by Digital Equipment. Many of the engineers on that project now work for Intel.
"That thing is going to run 10 times faster than what you can do today," said Mike Fister, senior vice president of the Enterprise Platforms Group at Intel, and buyers will pay for its performance. "It is a lot cheaper to crash a car on a computer than in real life."
But competitors aren't standing still. Sun is coming out with UltraSparc IV in 2004 and has ambitious plans to stay ahead. IBM, while selling Itanium 2 servers, will release its Power5 chip for its powerful Unix servers next year. Both companies have been long-established in the 64-bit computing market.
IBM and Sun's RISC (reduced instruction set computing) chips are 64-bit models that can accommodate far more memory than 32-bit designs such as Intel's Xeon and Pentium. These RISC chips power expensive servers but require their own distinct software.
One of the biggest advantages IBM's and Sun's new chips have over Itanium is that they don't force a "binary break," a requirement that most Itanium customers use new software instead of easily running older Xeon and Pentium programs on the new chip.
Bridging the gap
But Intel later in 2003 will try to bridge the gap between Itanium and Xeon with its IA-32 Execution Layer software, which lets an Itanium emulate a Xeon with respectable, if not stunning, performance.
Also holding Itanium back is the fact that server customers--especially in today's financially strapped climate--tend to move at a glacial pace, making it difficult for Intel to take market share. A number of the corporations implementing Itanium only are using the chip in "proof of concept" trials, Fister conceded.
Intel also is facing heat from below. Advanced Micro Devices released its Opteron chip in April, which can run the widespread 32-bit code used by Pentium and Xeon systems today as well as 64-bit software for heavier-duty tasks. IBM will use the chip in its servers, and Microsoft and major Linux companies have or soon will have software for Opteron.
On Monday, AMD launched its Opteron 800, good for servers with four or more processors. Three smaller server companies--Appro, Aspen Systems and RackSaver--will sell systems using the chip, said AMD spokeswoman Cathy Abbinanti.
But AMD doesn't have the financial strength of Intel.
"That's the big question with Opteron. Can AMD stay on that very aggressive Intel-like frequency and performance treadmill?" said
Intel itself is even a competitor. Five years ago, Intel was a minor player in server chips. Now, its Xeon chips dominate the market in one- and two-processor servers. Several large computing clusters, webs of small servers melded into de facto supercomputers, rely on Xeon. Itanium provides performance and reliability benefits over Xeon and actually costs only a little more than Xeon, but Xeon runs the familiar 32-bit code better.
"The RISC share is being drawn down by Xeon," said Martin Reynolds, an analyst at Gartner. "One of the challenges Itanium faces is the tremendous success of Xeon."
Investment and banking services company Raymond James Financial is sold on Itanium, though. Pilot tests showed performance jumped fivefold when it moved an application on a Xeon server to one with the same number of Itanium 2 chips, said Tim Eitel, chief information officer at Raymond James.
Raymond James is running a data warehouse for financial advisers and sales managers on a 16-processor Superdome with second-generation Itanium 2 chips. It will upgrade to third-generation Madison chips soon and expand the system as it nears production use in October.
Pricing could become one of the crucial issues for Itanium. If Intel can get server makers to price Itanium servers substantially below existing RISC-Unix machines, Itanium may begin to draw customers, Reynolds said. But because some of them sell RISC boxes, igniting a sudden revolution is difficult, he said.
But those challenges are perhaps easier to manage than the performance and schedule problems that plagued the Itanium program in the past. Intel now has hit its stride with Itanium.
"Intel at least so far is showing an ability to keep cranking the performance up," Illuminata's Haff said. "The first generation was awful, (second-generation) McKinley was very respectable, and this is more than respectable. It has very strong performance."