"Historically, when AMD feels it has a performance advantage it tends to match Intels pricing," said Nathan Brookwood, principal analyst at Insight 64. "When they feel that performance is comparable to Intel, they tend to discount. I believe theres a real performance advantage for Opteron where Opteron pricing is comparable to Xeon pricing, in the $400 to $600 range." One of Opterons key advantages may be in its significantly low heat dissipation, which has allowed customers to design 1U rack-mounted servers. Some major OEMs have designed 2U rack-mounted servers using Intels 32-bit Xeon processor, halving the number of CPUs that can be placed in a server rack."Thats the spec," said Phil Hester, chief executive of Newisys, a Texas server startup wholly focused on the Opteron, and in which AMD owns a minority stake. "But the actual is more like 40 watts." Part of the Newisys sales pitch is to allow customers to touch the working Opteron chip package, which is "slightly warm to the touch," Hester said. The combination of pricing and low TDP has allowed customers like Newisys and its rivals to design 1U dual-processor rack-mounted systems, the first step in convincing top-tier customers to adopt the Opteron. Newisys will sell its servers to system builders through an agreement with distributor Avnets Applied Computing Unit, and then directly to top-tier customers.
The Opteron is being rated at a thermal design power, or thermal tolerance, of 80 watts, according to sources. But OEMs familiar with the design say AMD is being generous.