IBM Hits Its Stride in Unix Server Race

IBM entered the Unix server market in 1988, trailing HP and Sun Microsystems in the race. Now it has 35 percent of the market. Its latest round of Power Systems releases aims to expand that lead with servers that contain multicore processors to increase speed and power efficiency.

"It is a race, and we're not slowing down."

That is how Ross A. Mauri, the general manager of IBM's (NYSE: IBM) Power Systems product series, describes competing against Sun Microsystems (Nasdaq: JAVA) and HP(NYSE: HPQ) for the Unix server market.

IBM announced a number of new products and upgrades Tuesday to help keep its current lead in revenue -- 35 percent of the market in the second quarter of 2008 compared to Sun's 29 percent and HP's 26.

Servers With History

The Power Systems product line is the latest generation of business computer servers that started with the AS/400 in 1988 in Rochester, Minn.

Earlier this year, IBM consolidated the System i and System p servers -- heirs to the AS/400 legacy -- into the Power Systems line.

Then during the Large Users Group conference at the Mayo Civic Center Tuesday, IBM rolled out the second piece of that move.

That includes upgrades to the Power 570 server and the addition of a Power 560 model along with many other hardware and software developments.

The Power 570 and 560 are manufactured in Rochester and are largely designed here as well.

"Rochester is the brains of the Power Systems," Mauri said.

Scalability Upgrade

The new Power 570 was given a bump in speed by the addition of processors that double the number of cores in a system. That simply means twice the power and twice the efficiency under the hood with the no change to the exterior.

And the machine can be tailored to a business's specific demands and can be expanded without tweaking the software systems or data on the server.

IBM also added the new 560 to the Power line-up. It logically fits into a niche between the 570 and the 550 models. It boosts 4-, 8- and 16-core configurations and is designed to help businesses consolidate multiple workloads in different formats onto less machine.

IBM says it can handle the work of 13 of Sun's Fire V490 servers or four of its Sparc Enterprise M5000 machines.

Add IBM's Power VM energy management software and a single 560 can use 83 percent less electricity than those groups of Sun servers, according to Big Blue.

The race between the three technology giants was very different in 1998, when IBM trailed the other two.

Race Is On

The Power4 processor hit the market in 2002, bringing IBM into the race, but still in third place.

In 2005, Power5 rolled out and IBM moved ahead of Sun in the Unix server market and brought it neck and neck with HP. Power6 came out in 2007, along with software that reduced the need for IT staff attention and cut electricity use. "We left them (Sun and HP) in our wake," says Mauri.

"They are now about five years behind us," he says.

And yet looking to the future, IBM does not want to rest and let them catch up.

"We are working on Power7 and next week I have a meeting to hear about research on Power8," Mauri said. "We're not slowing down."

AMD's Big Hopes Ride on Small Shanghai Chips

AMD has announced the immediate availability of its new quad-core Shanghai 45-nanometer Opteron processors for servers. The chip's design focuses on virtualization features. It represents a follow-up to the company's Barcelona processor, which suffered delays that effected the brand's overall image. With the on-time arrival of Shanghai, AMD hopes to recover.

AMD (NYSE: AMD) on Thursday began shipping its latest quad-core Opteron processor, codenamed "Shanghai."

Shipping earlier than previously planned, the chips arrive on the market shortly before the expected arrival of new Nehalem processors, competing hardware made by rival Intel.

The new offering, according to the company, provides up to 35 percent better performance than the company's Barcelona quad-core Opteron, and as much as a 35 percent decrease in power consumption at idle. The new server chip also features improvements in the chip design for enhanced virtualization performance and increased performance per watt, according to AMD.

However, Shanghai's release has greater significance beyond it technological specifications. It is an indicator that AMD is attempting to regain its footing after the lukewarm launch of its previous quad-core chip, Barcelona, in September 2007.

That roll-out was marred by protracted delays, bugs and generally lower-than-expected performance.

"[Shanghai] shows the execution issues of Barcelona seem to be behind [AMD]. They look to have hit their announced time lines, which is great, versus the misses that happened with Barcelona," said Ian Lao, an analyst at InStat.

With the Barcelona stumble behind AMD, Shanghai could be what the No. 2 chipmaker needs to help rebuild confidence in its brand.

"The biggest is showing AMD resolving development issues of their house, and [it] goes a big way to re-establishing their credibility. The customers of AMD's customers view this credibility as important as they make their IT purchasing decisions," Lao told TechNewsWorld.

Shanghai Surprise

Rather than go out and design a completely new quad-core chip, Shanghai is really an upgraded version of Barcelona with some enhancements in virtualization and increased speeds. Those are the results of moving to a 45-nm layout and re-architecting parts of the cores, explained Jim McGregor, another InStat analyst.

Improvements to the chipmaker's Direct Connect Architecture and AMD Virtualization technology have enabled the processors to deliver faster "world switch" time, enhancing virtual machine efficiency. The new chips offer optimizations targeted toward server platforms, said Lao.

"[The] biggest win is keeping the same power envelope so OEMs (original equipment manufacturers) don't have to re-design their power supplies and power backplanes. For customers, they can get more servers/performance/server for a given physical footprint, power footprint," explained Lao.

The Shanghai line of server processors consists of nine models, all of which have four cores -- five from AMD's two-way Opteron 2000 server system series and another four from the eight-way Opteron 8000 series. The Opteron 2000 line will include 2.3-, 2.4-, 2.5-., 2.6-, and 2.7-GHz speed grades. The Opteron 8000 line will forgo the slowest 2.3-GHz version.

Prices for the two-socket variety will range from US$377 to $989 at launch, with the 8000 series priced between $1,165 and $2,149.

Shanghai "extends the AMD64 architecture in the same socket, power envelope and thermal model as the previous generation," McGregor told TechNewsWorld.

Constant Competition

With Intel (Nasdaq: INTC) set to launch its second-generation Nehalem 45-nm server chip within a matter of days, AMD must execute, said Lao.

"The big thing is to consolidate their messaging and execution. If a product or tech is announced with a schedule, show it when promised," he pointed out.

The release of Shanghai is a critical moment for AMD to re-establish credibility in the market and maintain -- or potentially grow -- its presence in the server market, but it is only part of what AMD needs to regain its footing, said McGregor.

"Intel is not going away and only is becoming more competitive with the upcoming launch of Nehalem, so the environment [from here] on gets more competitive. As for the economic environment, both companies face challenges. With its high presence in the retail channel, AMD faces an immediate hit, but this is also likely the first segment to return during the upswing. The corporate market, which Intel dominates, may face a more challenging environment for a longer period of time, but Intel is in a great position to weather this storm," McGregor pointed out.

"The good news is that AMD is regaining its footing a bit, and other companies are focused on being competitive. In the end, the market wins from having this level of competition and two healthy competitors. AMD just needs to complete that transition to being financially healthy, which is the company's primary focuses," he concluded