Dell Inc. says it will give data center managers the choice of having Advanced Micro Devices Inc.'s (AMD) Opteron chips in its multiprocessor servers by the end of this year, a signal that the PC giant plans to push its server line harder into data centers.
Dell made the announcement during its first-quarter earnings report on Thursday. Revenue for the Round Rock, Texas, computer maker was up 6% since the first quarter of last year, but net income and earnings per share were both down double-digit percentages. Despite some dire overall earnings, Dell did announce that its server shipments were up 8% over last year. Combined with the announcement about AMD, analysts say the company is thinking about the needs of the data center.
John Taylor, AMD director of product communications, said having Dell roll out AMD chips in multiprocessor servers first -- as opposed to other servers, desktops or notebooks -- matters because data center managers are always looking to pack in processing power in small spaces without hogging energy.
"Data centers are physically limited in terms of the space involved," he said. "(With AMD) you're getting more work done in a smaller space with less power."
Gordon Haff, principal IT advisor at Nashua, N.H.-based Illuminata, said he thought it was more good news for AMD than bad news for Intel Corp., considering Intel's continued dominance in all other Dell products. He also said that it's hard to say whether Dell would expand its AMD offer to other servers and computers, but that getting the ball rolling could help.
"For whatever precise reason -- concern about increasing costs, its relationship with Intel -- Dell clearly found it extraordinarily difficult to do that first AMD product," he said. "I can say the first step is certainly the hardest one."
To balance the AMD news, Dell also announced that it would launch servers with Intel's newest Xeon processor, code-named "Woodcrest," which Intel says is more energy efficient. But it was the AMD news that caught most people's eyes, considering Dell's exclusive relationship with Intel in the past.
The announcement continues the rivalry between the two companies, which AMD has been pushing. Earlier this month, AMD posted a ticker display in Times Square in New York City comparing the cost of running x86 servers on its dual-core Opteron chips with Intel's dual-core Xeon chips. The display is part of an ongoing effort by AMD to gain market share on its larger rival by adding energy efficiency to the argument of chip performance.
AMD was also one of the founding members of The Green Grid, a nonprofit organization examining power consumption in the data center, and has invited Intel to join the group.
Dig deeper on x86 commodity rackmount servers