Intel commands more than 90 percent of the x86 server chip market, meaning that the overwhelming majority of servers offered use Xeon. IBM, the first brand-name maker to adopt Opteron, continues to offers Intel Xeon-based servers for a wide range of tasks, ranging from general purpose to heavy-duty processing. It pairs Intels Xeon MP, paired with its own X3 chip set for advanced four-processor servers, such as its eServer 366. Intel also has countered by adding comparable 64-bit capabilities to its Xeon chip and has discussed plans to deliver dual-core server chips later this year. Its plan includes seeding thousands of dual-core Xeon servers into the market later this year. Read more here about Intels plans for dual-core architecture."When Opteron first came out, there were really no applications with 64-bit extensions. Thats why we came out with a very focused strategy at first, saying for these appsthe HPC area is one area where theres a lot of supportso it worked well there. For some applications, where Opteron doesnt offer any benefit, theres no reason to offer a solution." Still, AMD has come a long way, executives at the manufacturers agree. "The concept of having a non-Intel branded processor in the volume server space two or three years ago was almost unthinkable. Today the question in the customers minds is, why not?" HPs Lacey said. "We believe customers are becoming chip-nostic. Were trying to offer them a value proposition, which is great management, great deployment and great performance and reliability. Whats under the hood in order to make that all happen, at the end of the day, customers should be agnostic to if we stand behind it and say this is a ProLiant." So, is Opteron poised to break out of its niche? The proof may be in the next generation of servers, which are hitting the market now. IBM and Sun both have been taking orders on dual-core-capable Opteron servers. HP recently began shipping machines with the chip inside. Sun is taking orders on four-way, dual-core Sun Fire V40z servers now, and will begin shipping some of the first ones shortly. It also plans to begin taking orders on two-way servers soon. IBM, for its part, will offer the new Opterons in its LS20 eServer BladeCenter and eServer 326, both of which will ship in June. Its also taking orders now. HP recently began shipping its ProLiant DL585, a four-processor server, and its BL45p blade server, based on the dual-core Opteron. But even though AMD has gone from nearly nothing in 2003 to almost attaining its goal of capturing 10 percent of shipments in 2004, dont expect overnight results, one analyst said. "Anecdotally, [AMD] seems to be gaining market share each quarter," said Kelly Quinn, an analyst at IDC. It has done so because it "went to market with very targeted solutions and was able to sell into certain accounts because of that precise targeting." But when it comes to gaining broad acceptance for so-called mission-critical servers that handle tasks such as databases, "Im not seeing that right now" for AMD, Quinn said. "At some point much further down the road, yes." In addition, AMD has yet to win some potentially powerful converts. Dell Inc., for one, continues to be an Intel-only operation, even though it has hinted at times about offering AMD-based products. Dell executives have repeatedly said that Intels 64-bit Xeon chips meet its needs and that customers havent yet been asking for AMD in great numbers. Want to learn more about Dells position on Intel versus AMD chips? Click here to read more. But Sun says servers based on the AMD chip are becoming a significant part of its business. So far, it has 1,800 direct Opteron customers, and it recently has landed accounts with companies including Electronic Data Systems Corp., JP Morgan & Co., Constellation NewEnergy Inc. and Yahoo Inc. "The more value I can offer to customers, the bigger biz opportunity. Its kind of like Business 101," said John Fowler, executive vice president of Suns Network Systems Group. But "dual-core [Opteron] will have a huge impact on the server. In same power envelope and same box for just a little bit more money, you get almost double the performance. "This isnt rocket science," Fowler said about choosing the chip. "Any way you look at it, it has a very significant impact for AMD," analyst McCarron said. "Its developed a strong server presence and shaken any image of being something that was less than tier-one quality. What you have now is a really competitive situation between the two companies." Check out eWEEK.coms for the latest news, views and analysis on servers, switches and networking protocols for the enterprise and small businesses.
"We think customer choice is good. We have[IBM] Power, Intel [Xeon] and [AMD] Opteron in different solutions for different customer needs," said Stuart McRae, manager of IBMs eServer xSeries.