the time McKinley is commercially available in the country,
there will be more business applications, and that's when
IA-64 sales will really take off
Itanium processor (launched on May 29, 2001) was Intel's foray
into the 64-bit
space, and it's aimed at the high-end server segment. This
segment has long been dominated by Sun Microsystems, IBM,
and Hewlett-Packard, who make systems that are considered
"proprietary." Their hardware (servers powered by
RISC processors) are closely tied in with their own operating
systems (Unix variants), and ISVs (Independent Software Vendors)
develop applications that are exclusive to those platforms.
Intel on the other hand, is known for its mass-market products
that are driven by price/performance.
Itanium has received mixed reactions from the industry. Some
considered it a cost-effective route to the 64-bit platform.
Traditional 64-bit players say they do not feel "threatened"
yet, as there are other factors (apart from processor) that
determine overall system performance. Analysts say Itanium
is really a "test processor" or a "test bed,"
and that the real one to watch is McKinley. Market Research
bodies pull out figures indicating that initial Itanium sales
are slow. Numerous media reports pronounce Itanium "a
threat to" traditional 64-bit server vendors, and that
it has given these vendors "nightmares" or "sleepless
nights." And what do we say?
Based on our research and discussions with industry analysts,
server vendors and some MIS personnel, we feel it's too early
to comment. If at all there is a "threat," it will
come later when Intel launches subsequent versions of Itanium
code named McKinley, Madison, and Deerfield. Sales of the
Intel 64-bit processor will pick up next year when more applications
are available for this platform. Of course, greater acceptance
for this chip also depends on factors like backward compatibility
with the 32-bit platform and co-existence with present infrastructure.
The RISC/Unix players who have a stronghold on the 64-bit
arena will eventually relent to market pressure and make their
products compatible with IA-64 (Intel Architecture for 64-bit
computing) so that both environments can co-exist in the enterprise.
Now here's evidence to support our statements.
Market researchers say initial sales of the Itanium processor
are slow. Says Avneesh Saxena, Director-Computing Systems,
IDC Asia-Pacific, "Very few IA-64's (Itanium servers)
have been shipped as of date. In Q3 2001, a total of five
units for $0.21 million were shipped in the entire Asia-Pacific
(excluding Japan), out of which just one was sold in India.
Compare this to the roughly 12,000 RISC servers for $770 million
sold in this region during the same period."
IDC pegs global sales for Itanium servers in Q3 2001 at just
$13.7 million (or 500 servers).
Poor initial response can be attributed to lack of business
applications for IA-64.
Nair, Research Analyst, Gartner India confirms this and says
the development community will drive initial demand. "Market
acceptance of Itanium will largely depend on applications
becoming available for this architecture. The current emphasis
by vendors of this product is on developer education and early
Nair says customers are awaiting the commercial launch of
the McKinley processor (in the second half of this year).
"It is expected that this new member of the Itanium Processor
Family (IPF) will have greater market acceptance than the
initial Itanium processor releases. Further, volume availability
will come as ISV solutions become widely available."
The Itanium processor (co-developed with Hewlett Packard)
has an entirely new architecture called EPIC (Explicitly Parallel
Instruction Computing). Whereas applications running on IA-32
are based on the x86 instruction set, that's more than a decade
old. The same problem exists for legacy applications running
on 64-bit RISC servers. So enterprises who want to use the
Itanium processor will have to either port existing business
applications to the IA-64 platform or invest in new 64-bit
applications for EPIC (that are now non-existent or scarce).
Also, investment in new 64-bit hardware (like Itanium servers)
means additional investment in a 64-bit operating system.
Intel has tried to create workarounds to this problem by making
the Itanium compatible with 32-bit applications that run on
its Xeon systems. However, the performance
of applications running
in "compatibility mode" does not match up to that
running in a true 64-bit environment.
And so, Itanium is not expected to be widely deployed yet.
McKinley processor (now in final stages of testing), will
offer twice the performance of its predecessor (at a lower
price), with triple the memory speed. McKinley has major design
improvements and that's why Itanium has come to be regarded
as a "test processor." By the time McKinley is commercially
available in the country, there will be more business applications
(compiled for EPIC), and that's when IA-64 sales will really
take off. By then, several vendors will offer McKinley servers.
Deerfield, a low-cost version of Itanium, will further boost
sales of IA-64 servers. That's going to be in the 2003-2004
timeframe. And beyond that, Intel may phase out its Xeon processor
RISC server vendors have anticipated all this and have plotted
a dual-track strategy. They have pledged support to Intel
by either porting their Unix variants to IA-64
or by transferring processor technology to Itanium.
HP for instance has worked with Intel right from the beginning
to co-develop EPIC and Itanium. It has also ported its HP-UX
operating system to IA-64 (HP-UX 11i applications run on Itanium
servers). HP is developing a chipset (code named Pluto) that
will enable its PA-RISC servers to work with McKinley. HP
also sells Itanium servers (rx series) with a choice of operating
systems HP-UX, Linux or 64-bit Windows.
IBM too is selling Itanium servers and workstations. Its Summit
chipset has been selected by Intel for McKinley and standard
32-bit Xeon processors.
Compaq has entered into an agreement with Intel for transferring
its Alpha chip technology to Itanium architecture.
All this will make future versions of Itanium a technologically
superior chip and give it market clout just the ingredients
that Intel needs to gain market share in the high-end server
Brian Pereira can be reached at