March 29, 2005 11:00 AM PST

HP drops eight-processor Xeon servers

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Hewlett-Packard, the top seller of servers using x86 processors such as Intel's Xeon, has followed rival Dell with a decision to retreat from selling models using eight processors.

Dell canceled an eight-processor Xeon server plan in 2003, a decision that dovetails with the company's position that powerful "big iron" servers are being replaced by clusters of lower-end machines. It took HP another generation of chips and crucial supporting components called chipsets to reach a similar decision--although for different reasons.

HP believes that forthcoming Xeon chips that employ dual-processing engines, called cores, will be more popular than full-fledged eight-processor machines, said Colin Lacey, director of platform marketing for the company's industry standard server group. And for powerful machines, HP steers customers to higher-end servers with as dozens of Intel Itanium processors.

"We are not refreshing our eight-socket platforms," Lacey said. "We have determined, based on the performance we anticipate delivering in the x86 space in 2005, that the position of the eight-way will be somewhat marginalized by these next-generation four-way platforms."

HP's move makes sense, said Sageza Group analyst Clay Ryder. "Eight-way systems are a lot more complicated than single-way," he said. Beyond four-processor servers, "things become geometrically more complicated. When things become complicated, they become expensive."

Business reasons provide further incentive for HP. "When you get to that level of Xeon performance, you're starting to have systems with Itanium there that becomes an internal conflict" between different HP business units.

HP revealed its decision to skip eight-processor servers at the same time it announced two new four-Xeon servers Tuesday, as expected, and a new dual-processor system. Intel's latest Xeon processors, which bring 64-bit memory extensions to four-processor servers, include a lower-end model code-named Cranford and a higher-end model code named Potomac with more built-in cache memory.

Intel and business partners plan to announce the chips at an event in San Francisco on Tuesday. Each new chip will be available in the new ProLiant ML570 G3 and DL580 G3 servers, Lacey said.

Different views of x86 servers
HP garnered $1.8 billion of the $6.1 billion in x86 server sales in 2004, and No. 2 Dell had $1.4 billion, according to market research firm Gartner. Dell and HP now rely on chipsets from Intel for all their Xeon models.

But the two other major server sellers, IBM and Sun Microsystems, believe high-end x86 servers are worth pursuing. Big Blue has its own chipset, called X3 and code-named Hurricane, that permits as many as 32 Xeon processors to be used in a single server. And Sun has chosen a partnership with Intel rival Advanced Micro Devices that will result in the "Galaxy" server line with as many as eight AMD Opteron processors.

IBM and Sun have a different view of the market, though. They each have their own high-end processor families to promote--IBM's Power and Sun's Sparc--while Dell and HP prefer to use Intel processors for high-end servers.

Previously, HP created its own chipset, F8, for its eight-Xeon DL740 and DL760 servers. For lesser machines, it purchased chipsets from Intel and Broadcom's ServerWorks division. Now it's Intel only for x86 servers.

"With this introduction, we do not have a new generation of ServerWorks chipsets shipping today," Lacey said. However, he added, "We continue to maintain open dialogue" with Broadcom.

HP sells servers with four AMD Opteron processors but as with Xeon doesn't plan eight-processor models, Lacey added. "For eight-socket

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