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Dell debuts first two AMD servers
Former Intel stronghold begins selling servers using Advanced Micro Devices' Opteron chip, and more partnership products are expected.
By Stephen Shankland
Staff Writer, CNET News.com
Published: October 23, 2006, 1:00 PM PDT

Dell on Monday began selling its first servers using Advanced Micro Devices' Opteron processor, ending another chapter of Intel exclusivity.

The computer maker has launched two systems: the four-processor PowerEdge 6950, for higher-end tasks such as housing databases, and the two-processor PowerEdge SC1435, for high-performance computing clusters or hosting Web sites. The 6950 will be sold alongside its Intel-based equivalent, the 6850, but the SC1435 replaces the Intel-based SC1425, said Jay Parker, Dell's director of worldwide marketing for PowerEdge servers.

With the move, Dell finally joins the other three major server makers in selling AMD-based x86 servers. The Round Rock, Texas-based company long had sold only Intel-based machines. However, it announced plans for AMD servers in May and began selling AMD-based PCs in September.
Dell AMD servers

"This is really beginning of what we hope to be a long relationship," Parker said. "I would expect us to roll out additional server products over time with AMD processors."

Dell announced the move at the Oracle OpenWorld conference, where Chairman Michael Dell and AMD Chief Executive Hector Ruiz shared the stage earlier in the day.

"It's about time they did something," said IDC analyst Michelle Bailey. "They've seen so much competition in the marketplace, particularly from HP, that their customers are probably asking, 'Why don't you offer me this?'"

Computer makers sold $5.9 billion worth of x86 servers in the second quarter, according to market researcher Gartner Group, with Dell in second place after No. 1 Hewlett-Packard and before third-placed IBM.

One likely area for Dell-AMD expansion would be a mainstream two-processor model, with reliability features such as backup power supplies and better management abilities. But for now, Dell sells only models using Intel's "Woodcrest" Xeon 5100 processor--the PowerEdge 1950 and 2950.

"We feel real comfortable with our position in that part of the market," Parker said. "The competitiveness of the Intel-based products is excellent now."

But don't expect AMD chips to spread across the Dell product line like wildfire. "I think they'll be very cautious about this adoption," Bailey said. "Once they get the supply chain going and the capabilities built inhouse, then they'll probably address the higher-volume piece of the business."

But adding AMD servers means Dell has an interesting challenge in positioning its products. In its news release, it boasts that the 6950 "eclipses" performance of its 6850 and consumes up to 20 percent less power.

Parker said that Dell will work to steer customers in the right direction, depending on what types of software they need to run. "We see a lot of customer confusion based on the competitors' agnostic positioning of Intel versus AMD. It leaves their customers in the lurch. As we roll out, we'll be providing specific guidance where appropriate," he said.

Intel indicated it's not going to stand passively by while AMD arrives at its previously most loyal customer.

"It's our job to continue to convince Dell and their customers that we have the best products for any computing need," Intel said in a statement. "Our server group is just coming off a record quarter, where we believe we gained share in the highest volume areas and now have the highest performing four-processor product according to TPC-C," a database server benchmark.

Dell prefers to stay above the fray but argues that the rivalry is healthy.

"In general, having competition in this space, both in marketplace and at Dell, will provide better value for customers in the long term and, ultimately, innovation in the industry," Parker said.

The 6950 has a starting price of $6,499; the SC1435 begins at $1,299.

The AMD machines rely on supporting chipsets from Broadcom's ServerWorks group, Parker added.

Dell's SC1435 is available with AMD "SE" Opteron, which consumes more power, but at 2.8GHz, it runs 200MHz faster than mainstream Opterons. Until now, only Sun Microsystems has offered the SE Opterons.

Also on Monday, in conjunction with Oracle OpenWorld, Dell announced that its OpenManage system management tools have been integrated into Oracle Enterprise Manager, letting customers of the latter manage Dell servers.

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