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Intel Debuts New Itanium, Xeon Chips

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Intel Monday unveiled two new server processors that are already the toast of the IT town.

The Santa Clara, Calif.-based chip making giant officially launched its next generation Itanium 2 processor (code-named Madison) and an improved Xeon MP chip (code-named Gallatin). The two semiconductors are targeted at mid-tier servers or as a crossover opportunity for companies that want to make the move into high-end computing.

The latest 64-bit Itanium 2 comes in three versions: 6 MB of L3 cache at 1.5 GHz ($4,226); 4 MB of L3 cache at 1.4 GHz ($2,247); and 3 MB of L3 cache at 1.3 GHz ($1,338). Each is priced in 1,000 unit quantities.

The three new 32-bit Xeons run faster at 2.8 GHz with 2 MB of L3 cache ($3,692); a 2.5 GHz version with 1 MB of L3 cache ($1,980) ; and a 2.0 GHz chip with 1 MB of L3 cache ($1,177).

Each of the Itanium and Xeon chips are pin compatible with previous versions so vendors can easily swap them into existing lines. All six chips include high-bandwidth, better I/O support, Hyper-Threading, PCI Express components and operating system support for Microsoft Windows Server 2003, key applications for Linux from SCO, MSC.Software, Red Hat, SuSE and Turbo Linux as well as Hewlett-Packard’s HP-UX.

While Intel shies away from releasing specific sales stats on its processor lines, the company did say it is on track to double the amount of Itanium-based servers by the end of this year. Intel said it is selling upwards of 40 2- and 4-way machines (more than 20 in 2002) as well as 10 “big iron” 8-way and above servers compared to last year’s number of five. The company said it is also on track to selling more than 60 Xeon-based machines complete with anywhere between 4 and 32 processors.

Senior vice president Mike Fister said he felt industry momentum for the newer Itanium chips specifically is particularly good.

“It’s a marathon, but I feel like we’re way out in front of the pack,” Fister said during a briefing to the press. “What we’re looking at with these two chips is to fill in the middle tier toward the high end especially in the ERP [enterprise resource planning] space. Some people, SAP for example will consolidate print servers or application servers into one server using either of these chips.”

The Usual Suspects Get in Line

Along with Intel’s release are a host of vendors announcing either the Itanium “Madison” or Xeon “Gallatin” in their latest server offerings.

Last week, IBM and Dell Computer pre-announced their support for the new Intel chips for their eServer xSeries 445 and PowerEdge 3250 systems respectively.

Hewlett-Packard , Unisys and NEC are among the rest of the top-tier vendors making their announcements this week.

It’s not like the competition can get close to Intel’s numbers. The company currently boasts an 85 percent share of the server market including 60 percent of servers with four or more processors.

Fister said the next generation processors are the result of some 20,000 hours of validation by Intel’s labs and its partners. Some of that work is done through a process known in the industry as a “Proof of Concept” in which vendors will take sample chips and test drive them in their systems.

And while the test is no guarantee of use, Intel says most people who do the pilot program will end up using its chips in production,

“The only thing that happens is that sometimes it takes them 6 months to do a test and then it has to be subjected to a bunch of other different factors Fister said. “In the past, there have been some companies drop the chip after testing it. If they did it was usually because their application wasn’t ready for primetime. And then we end up helping them out anyway.”

Tick, Tick, Tick

More than speed or additional features, Intel’s release of these chips also signifies a return to its metronome-like chipmaking production, according to analysts.

“After the release of Intel’s Itanium McKinley line, there seemed to be a bit of a lag, but that is somewhat expected because there had to be a big test phase when it came to McKinley,” Illuminata principal analyst Jonathna Eunice told

Intel said its new Xeon and Itanium lines are the result of some $9.5 billion in R&D and manufacturing at its various fabs. Intel chalked up the lag time in production partially to end of the year buying cycles and the bad timing in the economy.

Eunice said Intel’s relentless development, production and sales cycle is even a possibility because of the company’s best sellers — the Pentium 4 and the Celeron processors.

“Without those two, Intel would be in big trouble,” Eunice said.

As for future models, Intel said it is still on track to release its Xeon MP “Gallatin” refresh at the end of this year with 4 MB of L3 cache. The next two Itanium models include a Madison that clocks in close to 2 GHz with 9 MB of L3 cache also due at the end of this year and a DP-only low voltage Itanium 2 processor with 1 GHz and 1.5 L3 cache (currently code-named Deerfield). The chipmaker’s server chips based on its 90 nanometer process (Montecito and Potomac) are not expected to debut until at least late in 2004.

Intel also said it is planning a separate Itanium Madison release later this year. As previously reported, the chip is slated to ship in the third quarter of this year. Fister said the processor would fit into the same category as the 2003 Itanium models but with a different speed, amount of L3 cache and price point.

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