Dell Signs Up with Opteron

Five months after confirming its intentions, the company introduces its first AMD-based servers.

After years of speculation—and five months after confirming what many saw as inevitable—Dell has joined the Opteron fold.

The Round Rock, Texas, company, which for the past three years stuck by Intel as its sole chip vendor even as Advanced Micro Devices gained market share thanks to its Opteron processor, introduced on Oct. 23 the first of its AMD-based servers.

At the Oracle OpenWorld show in San Francisco, Dell executives unveiled the four-socket PowerEdge 6950 and the two-socket, 1U (1.75-inch) SC1435, the first of what Dell says will be a growing line of Opteron-powered systems. Company founder and Chairman Michael Dell announced the systems during a keynote address at the show.

"Its safe to assume that these are not point products," said Jay Parker, director of worldwide marketing for Dells PowerEdge servers. "The AMD-Dell relationship … will only expand over time."

In addition to the new hardware, Dell announced it is integrating Oracles Enterprise Manager tool into its OpenManage system management suite. That will enable users to monitor and manage their Oracle databases from the same console they use for their Dell hardware. Its similar to what Dell has done with other software, such as Altiris and Microsoft products, Parker said.

AMD previously was an also-ran in an x86 processor market dominated by Intel. However, the company in 2003 introduced the Opteron, which could run both 32- and 64-bit x86 applications, and began to see steady market-share growth. AMDs growth drove Intel—which until then had offered the Itanium as its only 64-bit processor—to change gears by adding 64-bit capabilities to its Xeon chips.

AMD has since beaten Intel to such milestones as dual-core technology and in making energy efficiency a selling point, although Intel this year has made strides in catching up with a totally revamped server processor lineup. Intel is also the first of the two rivals to introduce quad-core chips.

Still, AMD has continued growing its market share, with its Opteron garnering 25.9 percent of the x86 server market in the second quarter of 2006, the chip maker said, quoting Mercury Research.

Over the past three years, the other three top-tier server makers—Hewlett-Packard, IBM and Sun Microsystems—all adopted the Opteron, leaving Dell as the only holdout. That ended in May when Dell announced it would begin selling AMD-based servers and, later, PCs.

Dell officials have said they want the company to be the leading hardware vendor not only in price/performance but also in performance per watt, and Parker said the new AMD systems will be a step in that direction.

The 6950 is aimed at such high-end tasks as server consolidation and virtualization. Dell also is offering the 6950 as a lower-cost alternative to RISC-based systems, according to the company. The SC1435 is designed for high-performance computing clusters, Web serving and small and midsize businesses that are looking for greater performance but with high energy efficiency.

Customers can order the new systems now, and they will start shipping in mid-November, Parker said.

Clay Ryder, an analyst with The Sageza Group, said the adoption of AMD technology will help Dell satisfy a growing demand among its installed base, but he questioned whether the move will persuade many users to switch to Dell from other vendors.

"Primarily, for those who always buy Dell, [the addition of AMD technology] will allow them to buy something they couldnt before," said Ryder in Union City, Calif. "It was a recognition [by Dell] that they were leaving a lot of money on the table."

A lot of 64-bit business has gone by already, Ryder said. Those interested in pure 64-bit computing who were dissatisfied with Intels Xeon chips have likely already bought Opteron servers, Ryder said. "The fact that its taken this long [for Dell to offer AMD systems] is not a big deal, but it does serve as an illustration that Opteron has gone mainstream," he said.