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Itanium sales hit $14bn (w/ -$13.4bn adjustment)! Uh, Opteron sales too

Discussion in 'Intel' started by Yousuf Khan, Aug 31, 2004.

  1. Yousuf Khan

    Yousuf Khan Guest

    ***Big News*** Intel's Itanium chips have hit the $14 billion in revenue
    mark!! However there was a small one-time over-optimism charge of $13.4bn.
    BUT THIS STUFF IS INCREDIBLE, IT'S EXACTLY AS IDC HAD PREDICTED ALL ALONG!!
    That's an amazing 5,665 server units, this past quarter!!!

    PS- Oh, and btw, if you're interested (and frankly, I can't see why anyone
    would be), Opterons sold 60,000 server units, or something or another,
    blah-blah-blah.

    Now back to Itanium! HULK SMASH! HULK SMASH! Yeah!

    http://www.theregister.co.uk/2004/08/30/opteron_itanium_sales_q2/

    Yousuf Khan
     
    Yousuf Khan, Aug 31, 2004
    #1
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  2. Yousuf Khan

    keith Guest

    Hmm, I'll take the $.6B. (don't you just love accountants?)
    What? They're scrapping the Itanic? Come on! "Damned the ice-bergs,
    full speed ahead!" ....more horses!
    ;-)
     
    keith, Aug 31, 2004
    #2
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  3. Yousuf Khan

    keith Guest

    How much of that $56K does INtel realize? ...against what investment?
    That doesn't look good for HP! They've put a tad bit of ca$h in there to
    end up on the short end of the revenue stream!

    Well, can you say *DUH*! Commodity servers is the whole point of
    AMD64! Compare Itanic against Power 4/+/5, if you're looking in that
    market! Compare price/performance! But to blindly compare Itanic at $56K
    per to Opterons at 6% of that is nutz!
    Are you expecting more Itanic sales for the Christmas season? ;-)
     
    keith, Aug 31, 2004
    #3
  4. Yousuf Khan

    Tony Hill Guest

    Hmm.. to be fair to Intel though, their 5,665 server units generated
    nearly twice as much revenue as the 60,000 Opteron units. On a
    per-unit basis, each Itanium server is selling for more than 17 times
    as much as your average Opteron server (~$56,000 vs. ~$3,100).

    A couple other interesting tid-bits from this articles:

    - HP still sells 85% of all Itaniums by volume and 78% by revenue.

    - SGI managed only 12.5% of all Itanium revenue, despite the
    high-profile sales

    - NEC actually had the highest average server cost for Itaniums at
    $158,000 per server. SGI was only at $139,000 and HP much further
    down at $52,000, though well ahead of Dell's average of $21,000

    - The top 6 Itanium vendors listed accounted for 98.7% of all Itanium
    sales by volume and 98.1% by revenue. This is in direct contrast to
    Opteron sales where the top 4 vendors managed only 23.5% of all sales
    by volume and 25.7% by revenue. In other words, Opteron is definitely
    a "commodity" server chip while Itanium is definitely not.


    Interesting numbers, been a while since we've seen them. While
    Itanium sales do continue to grow, they aren't all that impressive.
    It seems like after taking into account seasonal variability that
    Itanium sales have been flat since Q4 of last year.
     
    Tony Hill, Aug 31, 2004
    #4
  5. What I want to hear are all the Capellas apologists who defended
    Alphacide and MIPSicide to speak up with "kill Itanic" prose on
    the grounds that it ain't churning the $$$.

    Come on, where the hell are you ? Were you paid by Intel to tote
    that garbage or what ? Repeat after me :

    "VOLUME UBER ALLES"

    What a crock. Low volume easy to code for architectures replaced
    by low volume hard as nails to code for architectures that burn
    MW and eat reticles for breakfast.... GOOD PLAN MR ANALYST, SHRED
    THOSE MARGINS.

    Cheers,
    Rupert
     
    Rupert Pigott, Aug 31, 2004
    #5
  6. Too bad those are server prices, not per-CPU prices. If the average Opteron
    were 2-way and the average Itanic were 32-way, that wouldn't be notable.
    Too bad for Intel that's not the case.
    Neither of those is particularly surprising, after HP dropped HPPA and Alpha
    and now SGI is only a shell of its former self (though still employing some
    top-notch folks).
    The latter three are not surprising; they fit in with general perception of
    the quality vs. price tradeoffs each vendor is known for. NEC is the
    standout; I hadn't paid any attention to them at all.
    That was the entire point of Opteron -- bringing 64-bit computing to the
    commodity market. Oh, and taking market share away from Xeon, and showing
    IT managers what a stupid idea it is to lock themselves into proprietary
    IA64 when they can run open AMD64 systems.
    What we need are CPU volume and ASP instead of server numbers.

    S
     
    Stephen Sprunk, Aug 31, 2004
    #6
  7. Yousuf Khan

    Yousuf Khan Guest

    Yeah, gotta wonder about that. I thought the highest end Itaniums were
    supposed to be those SGI's? What with all of that supercomputer stuff they
    keep selling to NASA, etc. And who the hell are NEC's customers that they
    command such huge avg sales prices?
    Yup, in a commodity processor, you gotta expect that the white boxers are at
    an advantage here. The OEMs are going to have compete against them based on
    something other than straight price: bundled software, services, etc.

    IBM is also falling behind the other two American server vendors, HP and
    Sun, on the Opteron front. Why aren't they introducing more sophisticated
    4-way Opterons, like the other two have already?

    Yousuf Khan
     
    Yousuf Khan, Aug 31, 2004
    #7
  8. Yousuf Khan

    Yousuf Khan Guest

    I think that's about as far as we're going to see. I doubt that either AMD
    or Intel break out their individual product-line numbers to any great degree
    during their conference calls.

    Yousuf Khan
     
    Yousuf Khan, Aug 31, 2004
    #8
  9. I suspect there are lucrative service contracts included in those prices.
     
    Never anonymous Bud, Aug 31, 2004
    #9
  10. Yousuf Khan

    Tony Hill Guest

    Well, $56K will buy you a 4-processor server, and at ~$3000/processor,
    that gives Intel a respectable $12,000 plus maybe the odd extra bit
    for chipset sales (at least in Dell's servers, though I think they
    might be the only "major" Itanium vendor using Intel's chipsets).

    Hmm.. add that up and you get something just shy of $70M in this
    quarter, or about $280M/year. I think we previously guessed that
    Itanium development was probably well in excess of $1B/year, so..
    umm.. not very good profit margins.
    Yeah, these sorts of numbers tend to suggest that the big Superdome
    servers are just not getting many sales at all, it's mainly the
    smaller stuff like the rx5670 and such.
    Hehe, perhaps, however Itanium and Opteron were the only numbers
    listed in the article, so as they say, go with what you have! I'm not
    really sure that Intel ever wanted the Itanium to be a commodity chip,
    so I don't think this is really a big issue. However commodity
    servers seem to be where the real growth in the market is, big iron
    servers just aren't seeing growth and mainly just serve as a way to
    get service contracts these days (not saying that this is a bad
    plan!).
    Yeah, I wouldn't mind a little Altrix under the tree this year! :> If
    nothing else I could sell it on eBay and get myself one hell of a nice
    dual-Opteron setup!
     
    Tony Hill, Aug 31, 2004
    #10
  11. Yousuf Khan

    Tony Hill Guest

    It's probably not such a big issue for Dell here, though I'd imagine
    that HP was hoping for a few more high-end sales. This tends to
    suggest that their big Superdome servers just aren't selling well at
    all. $52,000 is about the going rate for a fairly low-end 4P Itanium
    server or a well loaded 2P server.
    I think NEC might be a bit of oddity of statistics rather than
    anything too meaningful. While they sold expensive servers, they only
    sold 38 servers total for $6M in revenue. Those sorts of numbers give
    you a pretty high margin of error.
    Well, on the latter case they seemed to have done pretty well (though
    AMD64 was definitely not the only reason for IA64's rather limited
    success), but they aren't exactly taking a huge amount of market share
    away from Xeon. There was something like 1.4M Xeon servers sold in Q2
    vs. 60,000 Opteron servers. This gives the Opteron only about 4%
    market share. I guess this is a lot better than 0%, though at it's
    height the AthlonMP managed something like 5 or 6% of the global
    server market, so the Opteron hasn't even reached that stage yet,
    despite signing up some big OEMs.
     
    Tony Hill, Aug 31, 2004
    #11
  12. Yousuf Khan

    RusH Guest

    No surprise here, they are counting whole server system prices, not
    just the processors, Now check motherboard prices :)
    And how is the performance difference ? whoops ?
    ...in the world, where commodity is a key to succes.
    How much exactly R&D for Itanium was ? I remember something arround
    $1B.

    Pozdrawiam.
     
    RusH, Aug 31, 2004
    #12
  13. Yousuf Khan

    RusH Guest

    well, what did you expected from a company making fastest supecomputers
    on Earth ? :)

    Pozdrawiam.
     
    RusH, Aug 31, 2004
    #13
  14. |>
    |> It's probably not such a big issue for Dell here, though I'd imagine
    |> that HP was hoping for a few more high-end sales. This tends to
    |> suggest that their big Superdome servers just aren't selling well at
    |> all. $52,000 is about the going rate for a fairly low-end 4P Itanium
    |> server or a well loaded 2P server.

    It's better than it was for HP a year ago, or when I saw the last
    such breakdown! But, yes, I agree with your analysis.

    SGI has slipped on the average price, which probably indicates that
    its smaller customers are now prepared to accept Altix systems, as
    well as it has had fewer very large sales.


    Regards,
    Nick Maclaren.
     
    Nick Maclaren, Aug 31, 2004
    #14
  15. Yousuf Khan

    Grumble Guest

    What do you mean by proprietary versus open?

    Would AMD let VIA or Transmeta implement AMD64 in their CPUs?

    For a fee or gratis?

    I suppose Intel would refuse to let another company produce
    IA-64 compatible chips?
     
    Grumble, Aug 31, 2004
    #15
  16. Yousuf Khan

    Superfunk Guest

    Transmeta has indeed licensed AMD64 from AMD, i don't know about Via.
    Intel obviously is making AMD64 compatible chips also.

    I don't think Intel alone has the authority to let someone make a IA-64
    compatible chip, apparently the patents are tied up in a company owned
    by both Intel and HP.
     
    Superfunk, Aug 31, 2004
    #16
  17. Yousuf Khan

    Grumble Guest

    Indeed. The press release is dated Saturday May 26, 2001.
    http://www.amd.com/us-en/Corporate/VirtualPressRoom/0,,51_104_543~1181,00.html

    Specifically, Transmeta has licensed AMD's x86-64 technology and
    AMD's HyperTransport interconnect technology for their future x86
    processors and technology initiatives.

    http://news.zdnet.co.uk/hardware/chips/0,39020354,2087519,00.htm

    Transmeta Chief Technology Officer David Ditzel said the
    chipmaker will keep the 64-bit technology in its back pocket
    for now. "We've licensed the extensions to use them when we
    feel like it," Ditzel said.

    Three years later, has Transmeta done anything with their AMD64 license,
    aside from support for the NX bit?
    As far as I understand, Intel has a cross-licensing deal with AMD which
    gave them access to AMD64. For free?
    Doh! How could I forget HP?
     
    Grumble, Aug 31, 2004
    #17
  18. Yousuf Khan

    Jouni Osmala Guest

    Hmm.. to be fair to Intel though, their 5,665 server units
    Well even with that taken in account the number of processors on
    itanium system is greater than on opteron.

    Intel is pushing it no matter what, and AMD should hope intel won't
    push it harder. If intel would just once release the Itanium for a new
    procecess at same time as their x86 counter parts others would be in
    deep trouble in server market...
    Well not 17 times as average, but typically the price goes up
    exponentially, from smallest to biggest systems.
    4 Processor topend opteron will costs, over 4times as much as two
    processor top end opteron, without giving 2 as much realworld
    performance while 2 the peak.
    The same goes from 4->8 etc... Itanium sales are in bigger
    configurations, like 16 or 128 processor systems, so price/performance
    isn't such a deal, because they give the performance points opteron
    won't have, even at price points that opteron system vendors can only
    hope for.
    Thats SPEND money, but there is difference between sustainable and
    already spend money. For instance itanium can sustain its current R&D
    based on sales for this year on intel...So who cares what was the R&D
    costs that it had on previous years, intel invested its x86 revenues
    to kill 3 RISC families and take the processor market from them and
    succeeded, and probably withing few years can get the investment back
    in extra revenues on itanium platform. Itanium doesn't have to sell
    millions of peaces to succeed. Even half a million per year is quite
    profitable venture. But if it succeeds greatly and intel could sell
    million or couple million per year its still some extra revenue for
    intel that would of gone for other ventures without itanium.
    If you doubt the cost difference then. Let take their low end of
    itanium line...
    Sells at 513$ has half the cache and 3rd less of cache so only usefull
    for software developement platform, still intel is having nice little
    markup on them also. And the 1.5MB cache itanium really has 6MB of
    cache just most of it disabled. [The disablement is not for fixing
    defects its just that engineer salary compared to volume makes em more
    profitable to simply disable extra cache than design new layout for
    smaller cache, especially with high yield process on large wafers that
    intel has.] So intel is selling 4000$ for high end itanium because
    many customers are willing to pay for that for their multiprocessor
    systems, and is exacly same chip as they can sell for 500$ with nice
    profit margins on them too. Now if constantly people talk that alpha
    team costed 100M$ to keep alive. And itanium has 3 teams on it plus
    compiler guys. So thats well under 400M$ that itanium revenue should
    be this year, and after that rest is profit. [Or repaying the
    investment intel made on itanium.] So ASP with 2000$ and sales of 200k
    per year its something you should keep its alive, BUT there is still
    more itanium sales should grow little bit.
    I personally hope that AMD can survive, and power too on the strenght
    of intel since if they die processor prices go up, we all have
    itaniums...
    BTW: Itanium2 core is much smaller than P4 core but the cache's thats
    is redundancy protected take most of the area. So itanium should be
    about 2x as expensive to make than P4. And intel seems to make great
    profits on P4 so it wouldn't be far fetched that itanium COULD be made
    as a desktop processor with new software x86 emulation layer that
    already is onpar xeon on integer and beats it on floatinpoint.

    Jouni Osmala
     
    Jouni Osmala, Aug 31, 2004
    #18
  19. Yousuf Khan

    Jouni Osmala Guest

    Purpose of that company is to keep IA-64 intellectual property for
    BOTH Intel and HP and exclude others from the fact. So you would need
    both of em to agree for letting anyone else make IA-64 processors. So
    if either of them says you cannot do that.

    Jouni Osmala
     
    Jouni Osmala, Aug 31, 2004
    #19
  20. Have you seen the contract that set up that company? That is a
    reasonable guess, but it is equally possible that either party is
    allowed to sublicence under certain conditions.


    Regards,
    Nick Maclaren.
     
    Nick Maclaren, Aug 31, 2004
    #20
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