Dell Cant Wait for High-Performance Server Chips

The arrival of processors with baked-in virtualization stands to elevate everyday business servers, broadening their appeal, Dells server chief said Wednesday.

The Round Rock, Texas, PC maker highlighted virtualization, which allows a machine to be partitioned in order to run different software, and dual-core processors as agents that will help increase the performance of so-called industry standard servers—relatively inexpensive machines that use off-the-shelf hardware, such as x86 chips and run Windows or Linux—making them a more viable alternative to more expensive machines.

Dell is usually quick to adopt new processor technologies. About 80 percent of its servers now ship with 64-bit capable processors and the PCI-Express interface for add-in cards, two features that recently hit the market.

But virtualization has been different. The technology, which had been largely reserved for more expensive servers until the advent of software from companies such as VMware Inc., has still not been widely adopted, said Jeff Clarke, senior vice president of Dells Enterprise Product Group, in a scheduled conference call with analysts on Wednesday.

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The arrival of virtualization-equipped processors, which will ship en masse next year, could change that, he said.

Dell predicts the baked-in virtualization technology will boost standard servers performance and help to increase their utilization rates, two things that could shift more businesses to them.

"What this sets up, in our view, is an opportunity to increase utilization and performance. In the long haul we believe virtualization is a key technology to drive scalable enterprises, using industry standard servers to solve larger and larger problems," Clarke said.

Making standard servers more business-savvy could also boost Dells own prospects.

Business products such as PowerEdge servers and storage systems are the companys main focus. Dell counts on its server unit sales to help generate storage purchases as well as bring in services contracts.

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Virtualization-equipped server chips will be broadly available next year, when AMD and Intel plan to add the technology to their respective Opteron and Xeon chips.

Intels Itanium, for its part, will gain virtualization later this year, Intel has said.

AMD has also already begun offering dual-core Opterons, and Intel will begin seeding dual-core Xeons later this year.

Dual core, by itself, will have less of an overt affect, as Dell sees it.

The transition from single core to dual core isnt likely to influence businesses to trade down from dual-processor machines to single-processor machines, Clarke said.

"We think the people that have bought two-socket-based platforms and four-socket [machines] will continue to buy those at the same mix rate and [in trade] get incredibly more performance," he said.

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