Intel Takes Back Some Of AMD's Market Gains

In the picky, performance-sensitive workstation market, the Xeon 5100 has beaten back Opteron.
The tides of fortune can swing as fast in the computer industry as they do at a poker table. For plucky AMD, its gains in one small but important sector have disappeared faster than a rookie's chips at the World Series of Poker.

A report from Jon Peddie Research shows that Intel (Quote) has almost completely reversed the gains made by AMD (Quote) in the high-end performance workstation market in just one year.

The performance workstation market is a very tough one that doesn't get much play and isn't huge – around 670,000 machines shipped in the first quarter of this year, a 15 percent growth over the same quarter last year, according to Peddie – but is still bigger than the more hyped gamer enthusiast market.

Because it includes customers like movie studios doing effects rendering or Wall Street types who connect six monitors to one PC, the workstation market is very picky about its suppliers, and very tough on vendors, said Peddie.

"The workstation market is unforgiving, and if your system isn't up to par, you're not going to sell it," he told "The stuff they do is really critical and they have very little patience. If you shipped 25 workstations to DreamWorks and even one went down, you'd never sell another one to them. So vendors who sell into that market have to be able to go in and say it works."

But the problem wasn't reliability, the problem was performance. Intel's recent Xeon processors, starting with Woodcrest, incorporated Intel's Core architecture and in every benchmark flattened AMD's Opteron. While Xeon and Opteron are usually considered server processors, they are also used in the most powerful desktops.

"When the Core architecture first came out, it beat AMD in every benchmark. AMD had been the performance leader up to that point. Core took away performance leadership and with it the high-end workstation market," said Peddie. AMD has since closed the gap some with faster Opterons.

The Opteron market share numbers from JPR read like a sine wave. In the third quarter of 2005, AMD had just 6.6 percent of the workstation market to Intel's 93.4 percent. That soared to 13.3 percent in Q2 of 2006. Then came Woodcrest and AMD has been on a downward slope ever since, to 8.0 percent in the most recent quarter.

Phil Hughes, a spokesperson for AMD, said he isn't surprised at the current status of things. "Our slice of the workstation pie has always been relatively small in comparison to what our competitor has out there," he told "We've never had a great number of SKUs in workstations, whereas in servers we continue to get design wins."

He thinks that will change with Barcelona and Budapest, a single-socket Opteron design that hasn't been discussed much. Budapest is based on Barcelona technology but will work in single socket motherboards. Barcelona is meant for two- to eight-socket motherboards.

Also, Budapest will use the AM2 socket motherboards used in desktops and workstations, whereas Barcelona will use Socket F, the current design in multi-processors Opteron servers.

Hughes thinks AMD can regain some favor in that market with Budapest and Barcelona. "Looking at the architectural enhancements we made to the floating point pipeline and the cache, we very much expect it will perform well in high end workstation environments," he said.

Peddie agrees. "The big hope that AMD has is Barcelona, which will be extremely efficient and powerful, and that will help them pull back in a hunk of the market share in the high-end workstation market. It's going to come down to benchmarks and thermal profile. AMD has always done well in thermal profile so they should do well there," he said.

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