Intel Looking to Boost Enterprise Biz in 2014

Company officials see momentum going into the new year, but analysts say there are still challenges in the data center.

Most of the talk around Intel involves its efforts to gain traction against ARM and its partners in the highly competitive mobile device space, as well as its anticipated competition with ARM in the burgeoning low-power microserver market.

The chip maker also is making moves in such diverse areas as the Internet of things, the cloud and wearable computing devices, essentially looking to establish itself in any area where it can make its mark with its Intel Architecture.

However, Shannon Poulin's interest is more in what Intel is doing in the data center and, more specifically, in the enterprise. Intel is still the dominant chip maker in the data center, with its x86-based processors found in more than 80 percent of servers shipped. Overall, the company's Data Center Group had a good 2013, with revenues in the third quarter hitting $2.9 billion, 12.2 percent more than in the same period in 2012.

Poulin, vice president and general manager of Intel Data Center Marketing Group, is anticipating the cloud computing segment of the business to see growth of more than 30 percent for the entire year, and high-performance computing (HPC) and technical computing to generate 20 percent growth. However, with the enterprise group—which focuses on such traditional customer groups as major enterprises and telecommunications companies that use its mainstream Xeon processors, networking equipment and solid-state disks (SSDs)—the numbers will be underwhelming, with revenues flat or slightly down from 2012, Poulin told eWEEK. Intel is scheduled to release fourth-quarter and yearly financial numbers Jan. 16.

The reasons for the enterprise business' struggle are varied, from uncertain global economic conditions to the maturation of server virtualization technologies to the continued migration of workloads to the cloud, he said. That said, Poulin is expecting the enterprise segment to rebound in 2014, thanks to continued momentum from new products rolled out late in 2013, new offerings coming this year and an increasingly stronger worldwide macroeconomic picture.

Forrester Research analysts are expecting a stronger global economy—particularly in the United States—to help boost overall IT spending by 5.5 in 2014. However, the firm in a report released Jan. 2 said software will be the fastest-growing segment, followed by IT consulting and systems integration services.

Intel officials believe better economics also will help drive enterprise IT spending, and that strong adoption of new and upcoming products will fuel growth for the chip maker's enterprise business. In June 2013, Intel unveiled its latest generation Xeon E3 processor based on the new "Haswell" microarchitecture. The E3-1200S v3 chip—aimed at smaller, single-socket systems running general-purpose workloads—was the first of Intel's server chips to be refreshed last year. That was followed in September by the release of the 22-nanometer Xeon E5-2600 v2 processor family, which includes 21 products that address not only server workloads, but also storage and networking jobs for data centers, cloud computing environments and HPC.

The E5-2600 v2 lineup illustrates Intel's efforts to offer a range of product choices optimized for particular workloads. The new chips, which hold up to 12 cores, offer 50 percent better performance and 45 percent greater power efficiency than their predecessors, according to Intel officials.