May 6, 1999 5:00 AM PDT

AMD prepares new package for workstations, servers

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Advanced Micro Devices is planning on challenging Intel in the server and workstation market next year with chip packaging and bus technology that will allow computer makers to build multiprocessor systems featuring its top-of-the-line K7.

AMD is currently working on an interface for the K7 processor called "Slot B" that will be the cornerstone of a multiprocessor push, according to sources close to AMD. With Slot B packaging, the K7 processor will be mechanically--although not electrically--compatible with Intel's Xeon processors, a similarity that could diminish the burden of designing K7-based systems.

Additionally, Slot B will make K7s virtually interchangeable with the expensive Alpha processor from Compaq, which means Alpha system makers could well adopt the chip relatively quickly.

Although most believe that AMD faces a long and complex road in winning the K7 acceptance as a server or workstation processor, the company's ambitions could start to rearrange the processor industry chessboard. Intel's Pentium III Xeon processors sell for as much as $3,600, or close to $3,000 more than its most expensive Pentium III, and carry higher margins. Profits from Xeon sales, in fact, are subsidizing Intel's price war AMD in the consumer market, Intel executives have said.

A K7 chip capable of being put into a multiprocessor system would present the first direct competitor that Intel has ever faced in this market. At the same time, AMD could finally break into the higher profit segments of the processor business. And, because of its Alpha compatibility, blueprints for building boxes conceivably already exist. Manufacturers could swap out Alphas for K7s.

"To get a product into that space takes a lot of work," said Linley Gwennap, publisher of The Microprocessor Report. "If AMD can pull this off, it would be a nice revenue stream for them. There is a pretty big price umbrella to sit under."

"In concept, one could take the workstation and server chipsets and build boards that could be stuffed at the last mintue to give them an Alpha personality or a K7 personality," said Nathan Brookwood, prinicipal consultant at Insight 64. "I would be very disappointed if we do not see Compaq pursue that exact strategy."

AMD declined to comment on Slot B. In the past, however, executives have said that the K7 will be targeted at the corporate market and that AMD is looking at multiprocessor options.

The K7 is currently due in June and will come out in versions running at 500 MHz, 550 MHz, and 600 MHz and start at around to $500, said sources. The chip is targeted mostly at desktops, but AMD will also pitch it to entry-level workstations and servers, said Lance Smith, director of technical marketing at AMD.

The K7 will be compatible with the Pentium III in the sense that it will run Windows operating systems and associated programs. Desktop K7s will also come in a "Slot A" package that is mechanically identical to the interfaces which connect the Pentium III to the PC, according to AMD executives.

But AMD's chip differs from the Pentium III because, among other factors, it will depend upon the Alpha's EV6 system bus, the main conduit that connects the processor to the rest of the computer. The change means that the chipsets and motherboards for the K7 and Intel's chips will differ.

As a result, AMD has to convince component manufacturers to build K7-type parts. Slot compatibility, however, will ease some of the design burden for computer makers, sources have said.

So far, most analysts have praised the K7 design, with some even stating that the chip will outperform the Pentium III. "The K7 is designed to do high frequencies, period," said AMD?s Smith.

Benchmarks comparing the chip have been run. While Smith declined to give the results, he is looking forward to the day they come out. "No one has ever beat Intel on spec FP before," he said, citing a standard industry benchmark.

Slot B will likely be similar to the gargantuan "Slot 2" packages of the Xeon processor and contain room for more secondary cache memory. A Slot B interface would conceivably allow the company to tout the above advantages for multiprocessing systems. Different chipsets and motherboards would be needed, but mechanical compatibility would exist.

Getting there won't be easy. Testing and qualifying processors and chipsets for multiprocessing environments remains a technically arduous and expensive process requiring massive resources and blocks of time, said Gwennap. Manufacturers and customers are highly brand conscious.

"It's one thing if your PC crashes. It's another if your $200,000 server crashes," he said. "Even if they can qualify the K7 for multiprocessor environments, it is going to be hard to get traction because of the brand preference."

Nonetheless, if AMD can break through, it would find itself in a lucrative market. Volumes are small for server chips, "but the server market is where all the growth is," said Gwennap.

Prices and profits are also higher with multiprocessor server chips. Intel's Xeon chip, although expensive compared to desktop processors, is downright cheap compared to the multiprocessor processors from Sun and others, according to, among others, Nathan Brookwood, a consultant at Insight 64. These chips are also generally based around the RISC architecture. A multiprocessing K7 would be the first Intel competitor based around a related architecture.

 

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