Posted on 01/22/2007 11:02:02 AM PST by zeugma
Server and software maker Sun Microsystems Inc. has agreed to use chips from Intel Corp. in some of its servers and for Intel to endorse Sun's Solaris operating system, a person close to the deal told the AP late Sunday night.
An announcement is expected Monday, according to the person, who requested anonymity because the deal had not been made public. Specifics of the arrangement were not disclosed.
The companies scheduled a joint news conference with Intel Chief Executive Officer Paul Otellini and Sun CEO Jonathan Schwartz for Monday morning in San Francisco to announce the alliance.
Intel's stock was trading up 10 cents at $20.92, and Sun shares rose 3 cents to $5.74, both in morning trading on the Nasdaq Stock Market.
The deal marks a major design win for Intel, the world's largest computer chip maker, which has been fighting to reverse plunging profits and regain market share lost to archrival Advanced Micro Devices Inc.
It's also a sizable victory for Sun as the company continues its long climb back to profitability following the dot-com collapse and seeks more mainstream adoption of its servers and software products.
Shawn Dainas, spokesman for Sun Microsystems, declined to comment. Intel spokesman Tom Beermann also declined to comment.
The partnership comes amid an intensifying fight for market share between Intel and AMD.
Both companies have been slashing prices and incurring heavy expenses to transition to a more advanced manufacturing technology that will allow them to shrink the size of the circuitry on their chips.
They have also been waging an inch-by-inch battle for market share that has been particularly painful for Intel, whose previous generations of chips began falling out of favor for their high energy consumption.
Last year, Intel lost more than 5 percent of the overall computer chip market to AMD, according to Mercury Research. Longtime Intel loyalist Dell Inc. said it would also begin using AMD chips in its PCs and servers.
Some of AMD's most dramatic market-share gains have come in the high-margin server and laptop markets, areas where Intel traditionally had little competition.
However, Intel, which still commands about three quarters of the overall chip market, fired back at AMD last year by unveiling a new line of chips based on an upgraded design that industry observers cheered for delivering higher performance while giving off less heat.
The competitive pressure appears to be taking its toll on AMD, which is scheduled to report fourth-quarter earnings on Tuesday and has warned investors that plunging processor prices would "substantially" reduce operating income for the quarter.
AMD's focus on energy-efficiency helped the company lure away clients like Sun while Intel was still overhauling its product line.
AMD and Sun entered into a partnership in 2003, and in recent years Sun has relied exclusively on AMD to supply server chips based on the popular x86 microarchitecture, or design, used in many personal computers and servers.
Intel was also providing processors for Sun's x86 server line at the time, but was pushed aside out of concerns about the chips' power consumption.
Under the current deal, Intel will again provide chips for Sun's x86 line, though this time its Xeon processors are more powerful and boast dramatically improved energy-saving features.
Sun, which also makes its own line of Sparc branded processors, will still use AMD chips in some of its products, the person close to the deal said.
Sun, which is scheduled to report second-quarter earnings on Tuesday, is still clawing its way back to profitability after its gutting during the dot-com fallout.
The Santa Clara-based company has lost more than $5 billion since 2002, after tech-related spending dried up and demand plummeted for high-priced servers like Sun's that were snapped up during the boom but fell idle after the dot-com bust.
Intel's endorsement of the company's Solaris operating system is also an important victory for Sun, as many servers that use chips based on the x86 design often run on Linux or Microsoft Corp.'s Windows operating system.
Rumors of a Sun-Intel partnership had circulated since Friday, when Banc of America Securities analyst Sumit Dhanda wrote in a research note that Sun was considering using Intel's Xeon processors for its fast-growing x86-based server product lines.
Though Sun is a "fairly small player" in the market for x86-based servers, coming in sixth in terms of market share, Dhanda said, the company's sales in that market are growing rapidly.
Dhanda said such a partnership could allow Intel to gain as much as 50 percent of Sun's x86 business, which could translate into $25 million to $50 million in lost revenues for AMD.
"(W)hile the impact to Intel financials is not meaningful in the near-term, we think the shift away from AMD bodes well for momentum in Intel's server business over the course of the upcoming quarters," Dhanda said in the note.
Sun is still around?
You have a point, but I'd like to think there is a place for both OSes. Solaris 10 has some excellent features not really available in Linux.
Sun is going to have a real problem though as their low-end boxes are having their lunch eaten by Dell, HP and others. The problem with that, is that while the migration from Linux to Sun isn't huge, it's still something that places a roadblock in the way of using the bigger iron available in the larger Sun servers.
Our shop is moving towards moving a lot of our web applications to Linux VMware containers running on HP blades from Solaris servers.
Random PC question - I just figured I'd post in on a IT themed thread.
I just removed a instance of keylogging spyware from my computer this weekend and this question occured to me. Would it make any difference to save passwords in some obscure file tucked away somewhere and then cut & paste log ins and PWs, instead of typing them, when using my financial sites?
I just removed a instance of keylogging spyware from my computer this weekend and this question occured to me. Would it make any difference to save passwords in some obscure file tucked away somewhere and then cut & paste log ins and PWs, instead of typing them, when using my financial sites?
I just removed a instance of keylogging spyware from my computer this weekend and this question occured to me. Would it make any difference to save passwords in some obscure file tucked away somewhere and then cut & paste log ins and PWs, instead of typing them, when using my financial sites?
I doubt it would help much. I'd be extra-careful on that PC with spyware unless you wiped the disk and reloaded the OS. The only sure way to clean a trojaned PC is to load from trusted media from scratch.
There is no such thing as a "Linux system".
Almost any x86 server can run most standard Linux distributions. Similarly, almost any x86 server can run Microsoft Windows.
So any of these Sun Intel Xeon systems can run Linux, Windows, BSD, Solaris, VMware, and other operating systems.
Just like Sun's AMD Opteron based systems can run Linux, Windows, BSD, Solaris, VMware, and other operating systems.
Just like Sun's Intel Xeon servers from four years ago (V60 and V65) could run Linux, Windows, BSD, Solaris, and other operating systems.
Just like Sun's Intel server from five years ago (LX50) could run Linux, Solaris, and other operating systems.
And Sun sells SPARC servers which can run Linux and Solaris.
And IBM sells POWER5 systems which can run Linux and AIX.
And HP sells Intel Itanium systems which can run Linux, HP-UX, OpenVMS, and Windows.
Mark
Similar to my previous comment, there is no such thing as a "Solaris server".
There are 815 systems (740 x86/x64 systems, and 75 SPARC systems) which can run Solaris.
The vast majority of these 815 systems are not built by Sun.
To run Windows or Linux? We have a few of these - we have all HP servers, but these were our first that were AMD based. Previously all were Intel.
We ran into some problems related to the AMD PowerNow!/Cool'n'Quiet technology (which slows the cores independently of each other based on need, to save power).
Check out the AMD web site for the latest dual core "drivers". A change that the AMD installer makes (adding /usepmtimer to boot.ini for Windows 2003/XP) solved our problem.
When the AMD slows one of the cores, you basically have two (or more) CPUs running at different clock rates and that can screw up things that depend on the CPU clock for timing. It's mostly a problem for gaming, but we had problems with software that kept performance counters for statistics.
Excuse me but I know what I am talking about. I'm a digital signal process developer writing parallel software to run on 1000s of nodes. Our clusters are Linux systems. That is how they are referred to. When we run on Solaris, we call that Solaris systems.
We deal in more than just a "server."
...
out of curiousity, which distribution(s) of linux do you use?
If Sun dropped Solaris to concentrate on Linux there would be nothing to differentiate them from RedHat.
As their hardware transitions more towards the generic, Solaris is really the only thing that keeps them from becoming one of the crowd.
No one is interested in Solaris anymore. Look at Sun's stock price... it's in the toliet. Sun should have jumped on Linux a long time ago.
Sun committed Apple hari-kiri: they demanded a premium for their hardware and software while the rest of the market raced by them.
Becoming a Linux only dealer is not the way to profitability.
Personally I think all the big players are going to consolidate on Intel/AMD eventually. As the multi-core market takes-off the proprietary chips that continue to be made, and sold at a premium, won't be in demand.
I know you asked avacado this question, but I'd like to jump into the fray! :-)
I'm a Unix sysadmin and our shop was almost exclusively Solaris, but has branched out to linux as well. We're using Redhat Linux Enterprise. I've used it for DNS servers that I migrated from Solaris... it was easy and pretty seemless! I like Redhat!
They certainly did. And I never understood why they just let it happen. I still don't understand. We process massive amounts of seismic data and need 1000s upon 1000s of nodes and there is no way that Sun (hardware/OS) is cost effective.
Sun's business model is a mystery to me.
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