Why No Opteron for Dell?

 
 
By Roger L. Kay  |  Posted 2005-09-16 Email Print this article Print
 
 
 
 
 
 
 

Opinion: Everybody else has Opteron in their lineups and it doesn't seem to hurt them.

The revelation that Dell is phasing out Intels Itanium processors in favor of its more-standard Xeon processors highlights the difficulty Intel has had with its bogged-down efforts to get Itanium out of the starting blocks.

But it also raises a larger question about Dell and its supplier relationships.
Earlier this year, Kevin Rollins, Dells CEO, indicated that he was entertaining thoughts of bringing AMDs widely praised Opteron into its lineup on the server side.
A few weeks later, he announced that Dell would carry, as usual, an all-Intel lineup. We dont know what goes on behind closed doors, of course, but the sequence, which was a repeat of similar Noh plays of the past, did leave the impression, to the untutored eye, that Dell had used AMD to bash Intel into agreeing to a better deal.
But given the popularity of the Opteron in the server and workstation markets, industry scholars might wonder why Dell doesnt have at least one Opteron model in its lineup. Now, I can think of several reasons why not. Each new platform carries its own development, qualification and operating costs, and adding costs is not the Dell way. Substituting AMD for Intel would reduce the total Intel volume and might negatively affect discounting or marketing support from Intel. Oh, and it might make Intel angry, which is never a good thing. But there are some pretty compelling reasons in favor of putting an Opteron in the Dell product portfolio. Now it might not be fair to cite that dual-core Opterons—which have been in the market since early this year—vastly outperform equivalent Xeons, which wont come out in dual-core versions until later this year. When the dual-core Xeons do arrive, the performance gap should close up considerably, and, after all, whats six to nine months among friends? To read about AMD knocking Intel on its power consumption, click here. But Opterons are also less expensive, boosting the price-performance advantage they have, particularly in floating-point operations. And then, they consume less power, which means they cost less to run and require less cooling. Users who run engineering applications that rely on a lot of floating-point calculation describe the Opteron performance as "screaming." So, why not a Dell Opteron? In the background behind this discussion looms the pending litigation between AMD and Intel. AMD has accused Intel of restraining trade, and Intel has said its AMDs own damn fault. AMDs case will rest heavily on its ability to bring forth credible witnesses to say that Intel has done wrong. But if anyone puts Dell executives on the stand, I can predict what theyll say. In fact, I could probably write the deposition. To wit: Intel is a strategic partner. We dont mind sole sourcing from them because of the depth of the relationship. Of course, we want to give them all the volume we can. It supports the relationship and gains for us maximum support in the form of discounts and market development funds. The relationship is completely voluntary, no coercion involved. Were happy to have them for a strategic partner and work with them on many levels. They have great products and are involved with us in all sorts of ways. In fact, we love them. But Rollins has also said that he follows the lead of his customers, providing what they ask for, and none of them is asking for an Opteron-based system. They must be a rare set of customers, though, because both HP and IBM report shipping boatloads of the AMD systems to a wide variety of buyers among their commercial clientele. Analyst Roger L. Kay is president of Endpoint Technologies Associates Inc. Check out eWEEK.coms for the latest news, views and analysis on servers, switches and networking protocols for the enterprise and small businesses.
 
 
 
 
 
 
 
 
 
 
 

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