nehalem-ep

Updated on March 30 at 1:50 p.m. PDT with additional information throughout.

Intel's Nehalem-architecture chips will now try to make their mark in servers, after debuting in desktops in November.

On Monday, Intel is rolling out new Nehalem-based Xeon models targeted at servers using up to two processors. Nehalem offers some important firsts for Intel, including an integrated memory controller for better performance, hyper-threading for up to 16 virtual cores (which improves multitasking), and Turbo Boost Technology, which dynamically increases the processor's frequency (speed), as needed.

"Our most important server launch in well over a decade," said Intel Senior Vice President Pat Gelsinger, speaking on Monday at the Nehalem server chip launch event in San Francisco, which was streamed live over the Web. Gelsinger said Intel has already shipped hundreds of thousands of quad-core Xeon 5500 processors--which pack in just over 730 million transistors--to mostly high-performance computing customers. Gelsinger also said future 32-nanometer "Westmere" versions will have six cores and be essentially drop-in replacements for the current 45-nanometer Xeon 5500.

The announcement is anticlimactic to some extent. Apple has already announced a new Mac Pro using the Nehalem Xeon 5500 processor and last month Intel discussed how Nehalem will be used in new "Willowbrook" servers in mega data centers.

But fresh announcements were made Monday from the largest server suppliers in the world, including IBM. "You can get anywhere from a 20 percent to a 200 percent performance improvement going from (Intel's) existing 'Harpertown' processor," said Alex Yost, vice president IBM BladeCenter. IBM is the largest server supplier in the world based on revenue, holding about a 33 percent share of the market, according to Gartner.

"We did install a bunch of early systems at key clients on Wall Street and I am very encouraged," he said. Yost added, however, that at the processor level Nehalem offers virtually no difference in power savings over previous generations of Intel chips. Improved power efficiency can be achieved other ways, though: for example, using virtualization to condense many virtual servers into a single physical server or using more power-efficient motherboards. Moving from rack-based servers to blade servers can also boost power efficiency.

Dreamworks has also been a high-profile early adopter of Nehalem. Prior to Nehalem, Dreamworks had to wait overnight to get an animation rendering project completed but this can be done almost in real time with the new processor, according to Intel and Dreamworks.

Josh Crowe, vice president of engineering at Savvis, an outsourcing business, said Nehalem offers better virtualization technology for customers whose budgets "have been cut to next to nothing" because of the tough economic times. "The consolidation ratios are going to be massively improved," he said, referring to the ability to bring many virtual servers into one physical server box.

Analysts don't expect Nehalem to cause seismic shifts in chip market share because Intel processors already claim a disproportionate chunk of the server market. "We expect only an incremental upside on a unit basis," said Ashok Kumar, an analyst at investment bank Collins Stewart. More importantly, Kumar is closely watching Cisco's entry into the server market. "If the Cisco relationship opens up new market opportunities, that's where the upside will be." … Read more