Guild Companies

Last Monday was the big day for the third generation of Intel's high-end 64-bit Itanium processor. With the "Madison" processors, as the chips are called internally, Intel seems to be finally hitting its stride in the 64-bit world, which has been dominated by the remaining RISC/Unix vendors--IBM, Hewlett-Packard, Sun Microsystems, and Fujitsu Siemens. The third time had better be the charm for Intel, which has pumped an estimated $5 billion of chip design and manufacturing technology into Itanium and has yet to get any substantial revenue stream from the processors.

While OEMs have made either serious or half-hearted commitments to Itanium, HP has staked the future of its company on the processor. With Madison, it seems like Itanium is a much safer bet than it was three years ago.

"This is like a marathon," explained Mike Fister, senior vice president and general manager of Intel's Enterprise Products Group, which makes server and workstation chips as well as chipsets. "People tell me that Itanium has only a fraction of the sales of Xeons. And while this is true, it would be wrong to think that we do not have momentum."

If Fister sounds a little defensive, he is, as are other executives at Intel who have backed Itanium. But Intel has a bit of spring in its step these days, thanks to Madison. It's a good chip, even if it isn't perfectly compatible with the venerable X86 architecture that made Intel a household name.

The Madison will be sold under the Itanium 2 brand name, just like its predecessor, the "McKinley" second-generation Itanium. The Madison chip runs at 1.3 GHz and 1.5 GHz, compared with the 900 MHz and 1 GHz clock speeds of the McKinley processors. The McKinley chips offered 1.5 MB or 3 MB of on-chip L3 cache memory, had about 250 million transistors (with 3 MB of cache), and were implemented in a 180 nanometer process. The Madisons, which are implemented in a much tighter 130 nanometer process, allow Intel to put a lot more L3 cache on the chip and to crank up the cycle time on the processors without causing the whole shebang to melt and release that magical blue smoke, which is the essence of computing. The Madison chip has a whopping 400 million transistors, according to Fister, and a lot of that is taken up by the large L3 caches, which can significantly boost the performance of commercial applications, particularly those that are sensitive to cache, like those written in Java.

Intel has three different versions of the Madison chip, each with a different price and performance point. The entry Madison chip runs at 1.3 GHz and has 3 MB of L3 cache. It will sell for $1,338 in 1,000 unit quantities. The middle chip is slightly faster, at 1.4 GHz, and has slightly more L3 cache, at 4 MB; it costs $2,247 per 1,000. The fastest Madison chip runs at 1.5 GHz, has 6 MB of L3 cache, and costs $4,426 per 1,000. These are the same prices Intel has been charging for its 900 MHz/1.5 MB L3 cache, 1 GHz/1.5 MB L3 cache, and 1 GHz/3 MB L3 cache McKinley chips. OEMs and customers expecting a big price break on the Itanium processors with the Madison launch are going to be disappointed.

But, with anywhere from 40 to 50 percent more oomph, even at the same prices that is still a 40 to 50 percent improvement in price/performance for the raw processors. Whether this translates into price/performance gains, compared with McKinley-based machines, is largely irrelevant, since there were so few McKinley machines sold anyway and only a miniscule number of first-generation "Merced" Itanium machines ever made it out of the OEM factories. The Madison Itaniums are all about comparisons with existing and entrenched RISC/Unix architectures. That's why Intel has been letting OEMs like HP and NEC release performance information about Madison ahead of the launch date. It wanted to give Unix customers who buy machines with IBM Power, Sun Sparc, and even HP Alpha and PA-RISC processors, the time to think about it before they made an acquisition.

Given the performance numbers that Intel has been showing, the availability of Windows 2003, HP-UX, and Linux on the processors, and the fact that 400 key ISV applications are now available on Itanium (Fister says this is up from 100 applications this time last year), it looks like Itanium might have finally hit critical mass, so it can start getting some traction in commercial computing. Fister said that there are 44 tools for developing applications on Itanium for Windows, 12 tools for doing so on HP-UX, and 30 tools for doing so in Linux. Intel also has six different language compilers that it has created for Itanium.

Like Windows NT 4.0 was the third-time charm for Microsoft in the enterprise, it looks like Madison might just turn out to be the third-time charm for Intel in the enterprise. A lot will depend on how the OEM workstation and server makers try to peddle or meddle with Itanium products. While Fister can say that the number of OEM Itanium configurations with two or four processors has grown from 20 to 40 in the past year, and the number with eight or more processors has grown from five to 10, the enthusiasm with which these key customers of Intel push Itanium will determine, more than any feeds and speeds, how well or how poorly Itanium takes off.