Intel's Supercomputing Chip Is a Wash

Intel (Nasdaq: INTC  ) has an earworm. Like the insidious piano intro to Journey's "Don't Stop Believing," the idea of stretching a bit to create new markets appears to be stuck in Intel's head, and we keep hearing the same song over and over again.

Weeks ago, the semiconductor superpower announced a bold redesign of its Atom line, aimed squarely at the mobile market. The doctor is out until system builders have had a chance to get familiar with that product, while QUALCOMM (Nasdaq: QCOM  ) , NVIDIA (Nasdaq: NVDA  ) and other ARM Holdings (Nasdaq: ARMH  ) based chips try to lure hardware makers away from Intel by offering power-sipping but less-powerful processors across a range of mobile devices.

This time, Intel is casting bedroom eyes at the supercomputing sector. By packing as many as 50 simple execution cores onto a single chip, Intel aims to give researchers and engineers the number-crunching power they need to solve the hardest computing problems they can think up. Born from the fizzled Larrabee graphics processor project and a few other products that never quite made it to market, the Knight's Corner processor will go head to head against the best high performance graphics cards and Opteron processors offered by AMD (NYSE: AMD  ) and NVIDIA's Tesla chips.

However, with Knight's Corner, Intel will also cannibalize its own product offerings. The aging Itanium processor was built for exactly the kind of workloads that would benefit from Knight's Corner's massively parallel programming model. In the supercomputing space, Intel is mostly replacing itself.

It has to be done eventually, but don't expect Knight's Corner to improve any part of Intel's business, it should only hold the line. Intel is still a fine stock, but for other reasons.

Could someone please silence that piano?

Fool contributor Anders Bylund owns shares in AMD, but he holds no other position in any of the companies discussed here. Intel is a Motley Fool Inside Value selection. NVIDIA is a Motley Fool Stock Advisor recommendation. The Fool has created a covered strangle position on Intel. Motley Fool Options has recommended buying calls on Intel. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool has a disclosure policy.


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  • Report this Comment On June 03, 2010, at 6:46 PM, DoikMeyer wrote:

    AMD's Barcelona: Power-Sipping Data Center Dominator

    By Anders Bylund

    September 10, 2007 | Comments (0)

    Recs

    6 Email

    Share

    Print

    ShareThisThe cat is finally out of the bag. Did AMD's (NYSE: AMD) long-anticipated Barcelona architecture prove to be a meek kitten or a roaring lion?

    Quick background

    In a brutal price and technology war against CPU market leader Intel (Nasdaq: INTC) over the past year-and-a-half, AMD has swooned from strong profitability to serious financial doldrums, from an undisputed performance lead to eating the dirt behind Intel's Core 2 product line, and from a seemingly surefire contender to an equally certain-looking second-place finish in a field of two.

    The Athlon 64 processor line caught mighty Intel by surprise four years ago, to the point where the company had to adopt a form of the AMD-invented 64-bit instruction set in its own processors. After all, Microsoft (Nasdaq: MSFT) had already made a 64-bit Windows version based on those extensions.

    It might be time for another dose of underdog comeuppance, based on the Barcelona quad-core microarchitecture. It's AMD's most ambitious release in years, and the company's future is hanging in the balance of Barcelona's success.

    Sizing up the rumors

    We already knew much about this product well before it ever hit the streets. It's a true quad-core solution with a specialized cache and memory management structure, hooked up to the next iteration of AMD's HyperTransport system link and seasoned with a new virtualization-friendly layer dubbed Pacifica. Intel's latest and greatest quad-cores are essentially two dual-core processors bolted together, with its own virtualization layer but a slower system bus.

    What all that technobabble means is that AMD will outshine Intel's best when it comes to massively multicore systems, and should do better under memory-intensive workloads in general. That makes Barcelona an excellent choice for certain workloads, and well worth the extra cost to companies with the right needs.

    More importantly, Barcelona was supposed to draw no more power than a similarly clocked dual-core Opteron, meaning higher performance for the same cost in data center power consumption and cooling. For home users, those may not be big selling points, but IT managers feel differently.

    After all, the chips that were launched today are all server-class Opterons. The Phenom Barcelonas for desktop use will follow later this year, no doubt to a fresh round of marketing fanfare. For now, it's back to the data center.

    AMD's strong suit right now is in multi-socket servers and blade servers -- large machines in the mold of your classic supercomputer, and either meant for massive workloads or for slicing up into a large number of virtual machines.

    The company has been working with all the major virtual machine vendors to match their wishes and needs for the virtualization features, including Microsoft, VMware (NYSE: VMW), and the open-source Xen project, now owned by Citrix. I haven't seen any benchmarks on these features yet, but they will surely drop in soon. AMD's NUMA memory architecture and more coherent cross-linking of the computing cores on each chip should bring benefits in virtual machine efficiency, in theory.

    Gentlemen, start your benchmarks!

    Did I say "extra cost?" Surely you're used to seeing AMD relegated to the bargain bin of late, which is why pricing pressure from Intel has been so effective in hurting the smaller competitor's financial structure. Nobody wants to pay $200 for an AMD chip if there's an Intel chip with equal or better performance selling for $150, so AMD's hand has often been forced in recent history.

    But now the company is pricing its processors as if they're worth more than a Core 2 Xeon. The early rumors were pretty much dead-on, and the final Barcelona products are, in fact, more expensive than Intel counterparts of similar speeds.

    Judging from independent benchmarks, the Barcelona Opterons sometimes come out faster than the Xeons, sometimes slower, in raw performance terms. But on a performance-per-watt basis, these processors take the cake with ease, so it's no wonder that AMD wants to highlight the power efficiency of its new products.

    The Foolish bottom line

    Barcelona chips fit in the same system sockets as the previous generation of Opterons, and it's a rather trivial upgrade procedure to gain the benefits of these quad-core chips if you're used to building systems around dual-core Opterons.

    That means a well-supported platform for the product, with quality system chipsets available from AMD itself and NVIDIA (Nasdaq: NVDA), which is very different from the original Opteron launch with its new socket. AMD says that its Barcelona yields are fine, so we should see a rapid uptake of the new product, then. Dell (Nasdaq: DELL), Hewlett-Packard (NYSE: HPQ), and many other system integrators have already announced their updated machines, and many more will follow.

    So we have the product, we have the performance numbers, and we have the OEM platforms. Now it's up to the IT managers and CFOs of the world to give us the next data point, which is whether Barcelona looks worthy of its stiff-necked price tags. If you build it, they will come and have a look. Will they buy it? I certainly think so, and AMD's future may depend on a roaring "yes!" here.

    Further Foolishness:

    •VMware's Scorching IPO

    •Dueling Fools: Intel

    •Surprising Low-Rated Stocks Leaders Love

    Last chance in 2010! Get notified ahead of time as professional investor Jeff Fischer manages a $1 MILLION long/short, real-money portfolio of stocks, options, and ETFs. This is the first open since Jan. 2010 and last open this year. By invitation only for 7 days only. Enter email below.

    Dell, Intel, and Microsoft have something in common besides PCs: The three amigos have all been tapped by our Motley Fool Inside Value team of bargain hunters. Dell is also a Motley Fool Stock Advisor pick, along with NVIDIA. Read all about it with a bushel of free 30-day trial subscriptions.

    Fool contributor Anders Bylund owns shares in AMD, but holds no other position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure will make your day, every day.

    Read

  • Report this Comment On June 03, 2010, at 6:46 PM, DoikMeyer wrote:

    AMD's Barcelona: Power-Sipping Data Center Dominator

    By Anders Bylund

    September 10, 2007 | Comments (0)

    Recs

    6 Email

    Share

    Print

    ShareThisThe cat is finally out of the bag. Did AMD's (NYSE: AMD) long-anticipated Barcelona architecture prove to be a meek kitten or a roaring lion?

    Quick background

    In a brutal price and technology war against CPU market leader Intel (Nasdaq: INTC) over the past year-and-a-half, AMD has swooned from strong profitability to serious financial doldrums, from an undisputed performance lead to eating the dirt behind Intel's Core 2 product line, and from a seemingly surefire contender to an equally certain-looking second-place finish in a field of two.

    The Athlon 64 processor line caught mighty Intel by surprise four years ago, to the point where the company had to adopt a form of the AMD-invented 64-bit instruction set in its own processors. After all, Microsoft (Nasdaq: MSFT) had already made a 64-bit Windows version based on those extensions.

    It might be time for another dose of underdog comeuppance, based on the Barcelona quad-core microarchitecture. It's AMD's most ambitious release in years, and the company's future is hanging in the balance of Barcelona's success.

    Sizing up the rumors

    We already knew much about this product well before it ever hit the streets. It's a true quad-core solution with a specialized cache and memory management structure, hooked up to the next iteration of AMD's HyperTransport system link and seasoned with a new virtualization-friendly layer dubbed Pacifica. Intel's latest and greatest quad-cores are essentially two dual-core processors bolted together, with its own virtualization layer but a slower system bus.

    What all that technobabble means is that AMD will outshine Intel's best when it comes to massively multicore systems, and should do better under memory-intensive workloads in general. That makes Barcelona an excellent choice for certain workloads, and well worth the extra cost to companies with the right needs.

    More importantly, Barcelona was supposed to draw no more power than a similarly clocked dual-core Opteron, meaning higher performance for the same cost in data center power consumption and cooling. For home users, those may not be big selling points, but IT managers feel differently.

    After all, the chips that were launched today are all server-class Opterons. The Phenom Barcelonas for desktop use will follow later this year, no doubt to a fresh round of marketing fanfare. For now, it's back to the data center.

    AMD's strong suit right now is in multi-socket servers and blade servers -- large machines in the mold of your classic supercomputer, and either meant for massive workloads or for slicing up into a large number of virtual machines.

    The company has been working with all the major virtual machine vendors to match their wishes and needs for the virtualization features, including Microsoft, VMware (NYSE: VMW), and the open-source Xen project, now owned by Citrix. I haven't seen any benchmarks on these features yet, but they will surely drop in soon. AMD's NUMA memory architecture and more coherent cross-linking of the computing cores on each chip should bring benefits in virtual machine efficiency, in theory.

    Gentlemen, start your benchmarks!

    Did I say "extra cost?" Surely you're used to seeing AMD relegated to the bargain bin of late, which is why pricing pressure from Intel has been so effective in hurting the smaller competitor's financial structure. Nobody wants to pay $200 for an AMD chip if there's an Intel chip with equal or better performance selling for $150, so AMD's hand has often been forced in recent history.

    But now the company is pricing its processors as if they're worth more than a Core 2 Xeon. The early rumors were pretty much dead-on, and the final Barcelona products are, in fact, more expensive than Intel counterparts of similar speeds.

    Judging from independent benchmarks, the Barcelona Opterons sometimes come out faster than the Xeons, sometimes slower, in raw performance terms. But on a performance-per-watt basis, these processors take the cake with ease, so it's no wonder that AMD wants to highlight the power efficiency of its new products.

    The Foolish bottom line

    Barcelona chips fit in the same system sockets as the previous generation of Opterons, and it's a rather trivial upgrade procedure to gain the benefits of these quad-core chips if you're used to building systems around dual-core Opterons.

    That means a well-supported platform for the product, with quality system chipsets available from AMD itself and NVIDIA (Nasdaq: NVDA), which is very different from the original Opteron launch with its new socket. AMD says that its Barcelona yields are fine, so we should see a rapid uptake of the new product, then. Dell (Nasdaq: DELL), Hewlett-Packard (NYSE: HPQ), and many other system integrators have already announced their updated machines, and many more will follow.

    So we have the product, we have the performance numbers, and we have the OEM platforms. Now it's up to the IT managers and CFOs of the world to give us the next data point, which is whether Barcelona looks worthy of its stiff-necked price tags. If you build it, they will come and have a look. Will they buy it? I certainly think so, and AMD's future may depend on a roaring "yes!" here.

    Further Foolishness:

    •VMware's Scorching IPO

    •Dueling Fools: Intel

    •Surprising Low-Rated Stocks Leaders Love

    Last chance in 2010! Get notified ahead of time as professional investor Jeff Fischer manages a $1 MILLION long/short, real-money portfolio of stocks, options, and ETFs. This is the first open since Jan. 2010 and last open this year. By invitation only for 7 days only. Enter email below.

    Dell, Intel, and Microsoft have something in common besides PCs: The three amigos have all been tapped by our Motley Fool Inside Value team of bargain hunters. Dell is also a Motley Fool Stock Advisor pick, along with NVIDIA. Read all about it with a bushel of free 30-day trial subscriptions.

    Fool contributor Anders Bylund owns shares in AMD, but holds no other position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure will make your day, every day.

    Read

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