January 25, 2007 12:13 PM PST
Intel inside again for new Google servers
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Google has begun buying Intel server components in high volume, said Pat Gelsinger, a co-general manager of Intel's Digital Enterprise Group, speaking about the Google relationship on an internal Intel blog entry Wednesday seen by CNET News.com. "We're in business with the volume systems ramp under way," he said.
AMD could well have a place alongside Intel. "We bought a small number of chips from Intel recently, but we continue to be supplied by more than one vendor," Google said in a statement, but didn't discuss motherboard purchases or other details. AMD and Intel declined to comment.
On his blog, Gelsinger said Intel had to create custom equipment to win back the business.
Google "went to the competitor's platform for the last four quarters of deployments, largely on the (operational cost) model they use to judge their purchases," Gelsinger said, a model that takes into account power and cooling costs, server performance, memory costs and other factors. Intel design teams "have been maniacal as we designed a unique board for them, developing a unique memory module with them, working every angle of the cost equation and engaging with our sales teams to get the business," Gelsinger said.
Intel's rising fortunes
The Google change is emblematic of Intel's rising fortunes. Beginning in 2003, AMD capitalized on performance and power efficiency advantages of its Opteron processors to make its way into the server lines of the four top-tier server companies: IBM, Hewlett-Packard, Dell and Sun Microsystems. But in late 2006, Intel's new dual-core Xeon 5100 "Woodcrest" and quad-core Xeon 5300 "Clovertown" processors helped Intel reclaim some server chip market share and put major price pressure on AMD.
AMD expects that its fortunes will be boosted by its upcoming quad-core Barcelona processor, which the company promises will provide 40 percent better performance overall compared with Clovertown. Barcelona is due in mid-2007 and will plug into existing servers with dual-core Opteron chips.
Server power consumption has become a huge problem as companies grapple with increasingly power-hungry servers and rising electricity and cooling costs. Google is among those to sound the alarm about increasing power and cooling expenses.
IDC analyst Michelle Bailey said at a Hewlett-Packard media event Wednesday that spending on servers is increasing at about 2 to 3 percent per year, but spending on power and cooling is growing at four times that rate. "For every $1 spent on new servers, companies spend about 50 cents on power and cooling their installed base," she said. "That's a massive inhibition in the ability to innovate."
Gelsinger touted another victory for the Santa Clara, Calif.-based chipmaker. Earlier this week, Intel also reclaimed a place in Sun's server line, a move Gelsinger likened to Apple's switch to Intel in 2005.
"This is an Apple-like deal. While Sun's overall size is a modest portion of the market, they are a technology leader. They are an engineering-centric company. They are innovative and passionate about technology and products," Gelsinger said. "Further, they are focused on the high end of the market where ASPs (average selling prices) and margins are highest."
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