But Wait, There's More

Server Market to Grow to $81 Billion by 2011? Is That a Joke?

My original working title for this brief story was "Server Market to Grow to $81 Billion by 2011? Really? No, Really? Is That a Some Sort of Joke? HAHAHAHAHAHA," but that wouldn't fit very nicely on the page layout of this newsletter. But that was indeed my reaction when I read a report from IT market researcher Research and Markets about the current and future size of the worldwide server market.

This is not just an estimate that is a little off, but one that is off by a lot. Either someone made a typo, or there is an analyst at the company who is unfamiliar with both The Spreadsheet Effect (cash flow always goes positive six months out . . .) and the current state of server technology and its likely impact on server sales. But nonetheless, I would like to say thank you. When I wrote this story, it had been a long week, I just got back from the dentist, the Novocain had just worn off, and I really needed a good laugh to lift my spirits. Again, thank you.

All joking aside, the Research and Markets server report referenced above provided what seems like reasonable numbers for the size of the worldwide server market in recent years, pegging the market at $49.8 billion in 2004, up from $44.6 billion in 2003. It was the jump to $81 billion in sales by 2011 that cannot be true, and I will explain why. The relentless competition among server processor architectures and among all of the individual suppliers of all the gadgets that go into servers continues to heat up according to both the precepts of Moore's Law and the competitive laws of supply and demand. Server prices are going to continue to drop. Moreover, the advent of more sophisticated operating systems, with either integrated or bolted-on virtualization technologies, is going to eventually make servers much more efficient than they currently are. While the late 1990s saw an explosion of server footprints as distributed computing entered its heyday, the late 2000s are going to witness what could be a similarly huge implosion of footprint counts as customers learn to virtualize and consolidate their servers. So the price per footprint is coming down along the Moore's Law curve--maybe 30 percent to 40 percent every 18 months now--and the number of footprints will eventually start coming down--perhaps by a factor of three or four among enterprises. If we start expanding the definition of the server market to include SOHO servers, perhaps the footprint count for servers could be maintained or even extended--there are a lot more homes than businesses in the world, after all--but that would be an apples-to-oranges comparison. I think what can be safely said is that within six years, there will be fewer server footprints unless something really weird happens, like we all have to start our own businesses. And a lot fewer footprints times a radically lower selling price means less revenue for the server market, not more. No joke. And don't even get me started on how grid/utility computing might even accelerate the decline in server box sales and the revenue streams. . . .

Novell Clarifies its Position on KDE and Gnome Interfaces

There has been a lot of talk about Novell's plans for the graphical user interfaces it will support for its future SUSE Linux desktop and server implementations. For some bizarre reason, some people have got it into their heads that SUSE will not be supporting the KDE graphical environment, and they seem to think this might be related to the recent layoffs at Novell.

Given the fact that Novell bought Ximian, the company behind the open source Gnome interface for Linux, before it even bought SUSE, it might seem like a reasonable conclusion to jump to that Novell would somehow focus its efforts on Gnome and stop worrying about KDE. Sources at Novell say this is a tempest in a teapot, and it will, in fact, support both interfaces for all future SUSE Linuxes. What has changed is that future Linuxes will ship with Gnome--an interface Novell knows better since it is the key developer for it--as the default interface, with KDE being the fully supported option. SUSE 8 and SUSE 9 were the other way around--KDE was the default with Gnome as the fully supported option.

AMD Is Ready for More Black Ink

Chip maker Advanced Micro Devices hosted a financial analyst day with Wall Street analysts last week just to talk up its prospects for the future. Things haven't looked so well for AMD in its chip-making business ever.

Dirk Meyer, president and chief operating officer of AMD's Microprocessor Solutions Sector business, said that AMD outgrew its competition by over 140 percent in the past year, and that it expects to grow by more than 100 percent in the coming year. While Athlon chips have allowed AMD to grow by almost 20 percent, the advent of the Opteron processors for servers have allowed AMD to really take the lead on innovation. AMD is projecting that it can grow its server-related microprocessor shipments at double the rate of the entire chip industry as a whole, which is projected to grow at around 10 percent in 2006. AMD's growth--and the thickening black ink at its bottom line--will be driven by server processors as much by mobile and desktop chips. Robert Rivet, AMD's CFO, predicted it would be a "pretty good" year for AMD in 2006, with Microsoft's Vista pushing desktop upgrades in the second half for Athlon chips and a continuing ramp for Opteron in the server space. Meyer said that AMD had about $1 billion in chip sales in the X86-based consumer device market that had a $15 billion total addressable market, and that the commercial X86 chip market (servers and desktops for businesses) represented about a $15 billion total opportunity and AMD got about $1 billion of this space. River said AMD was expecting to generate $1 billion in operating profits next year.

Bytware Debuts McAfee-Based Antivirus for Linux PCs

While a lot of attention has been placed on the vulnerability of Windows security and the prevalence of Windows viruses, worms, and other malware floating about the Internet, there are also very real threats to other operating systems, such as Linux. To this end, systems management and security software vendor Bytware has unveiled a new antivirus product aimed at Linux-based PCs.

The software, called StandGuard Anti-Virus for Linux, is based on McAfee's antivirus scanning and removal engine, and it just entered beta testing. The software works only on X86-based Linux PCs, and protects users from all of the threats McAfee's Avert engine detects and removes, which currently numbers more than 150,000, according to Bytware. The product gives users the choice of using a GUI or a command line, and it also offers the capability to run commands in users shell scripts. Users can create scan tasks and choose which files types they want scanned, and rest assured that the DAT files are being updated daily, directly from McAfee, over the Internet. To download a trial version of the software, go to www.bytware.com/downloads/request_trial_linux.html.

Sun, NEC, and AMD Partner for 50 Teraflops Opteron Cluster

Considering that Itanium-based server supplier and vector supercomputer maker NEC and RISC/Unix and Itanium server maker Fujitsu pretty much rule the indigenous supercomputer market in Japan, it was somewhat surprising to see that Sun Microsystems partnered this week with NEC and AMD to deliver a 50 teraflops supercomputer based on future eight-socket "Galaxy" Opteron-based servers. You would have thought that Sun would have partnered with Fujitsu to beat out NEC for the deal at the Tokyo Institute of Technology.

Under the deal, Sun and AMD will deliver a cluster running Linux (with Solaris 10 as an option on the nodes) with 5,240 dual-core processors. The machine, comprised of 655 servers, will also have 360 Advance co-processors from ClearSpeed for boosting the speed on HPC algorithms. By next summer, the Tokyo Institute of Technology plans to add another 240 Advance co-processors and boost the number of Opteron servers such that it can reach 100 teraflops of performance. This is by far the largest HPC deal--in terms of processor count and raw aggregate performance--that Sun has ever been involved in, and it bodes well for the Galaxies. It will have over 21 TB of main memory and 1.1 PB of disk storage (which is coming from NEC) in the initial 50 teraflops configuration. The machines will be lashed together using InfiniBand interconnect from Voltaire. Sun's N1 System Manager and N1 Grid Engine software will be used to manage the cluster.

IBM Previews "Viper" DB2 Database Version

The battle for the hearts and minds of database administrators and application architects is about to get a lot hotter if IBM has anything to say about it. The company has just offered a sneak peak--what Big Blue calls a product preview--of the future "Viper" release of its DB2 database for Windows, Unix, and Linux. DB2 Viper will be distinct from current DB2 database implementations in that it will be able to store XML-formatted data inside the database natively--XML support will not be bolted onto the side. Viper will also support relational data stores, of course, and access to those database tables using the SQL programming language. The XML data will be accessible through the XQuery XML query language, which is an analog to SQL for relational databases. IBM reckons that the addition of native XML support will expand the $7.8 billion relational database market by another $1.4 billion. And IBM wants to get the bulk of that additional XML-related revenue for databases.

Viper will be able to store structured data--traditional database tables--as well as unstructured data--PDFs, spreadsheets, documents, and so forth. IBM also added that DB2 Viper could be packaged with the Zend Core for IBM product it co-created with Zend Technologies, the creators of the open source PHP programming language. DB2 Viper is in beta now, and will ship some time in 2006. You can get the beta version at this link.

Big Blue Gets Presidential Award for Processor Innovation

IBM has been presented with the National Medal of Technology by President Bush for its efforts to advance the art of processor development and production here in the good old U. S. of A. The White House cited IBM's advances in DRAM technology, multicore processors, copper and silicon-on-insulator, and strained silicon chip making processes (used in the PowerPC and Power families of chips), and high-speed silicon-germanium chips (used in cell phones and other communications devices) as the reasons for giving IBM the award. The company's East Fishkill and Albany, New York; Austin, Texas; Burlington, Vt.; Rochester, Minn.; and San Jose, Calif., labs were specifically cited in the award. The National Medal of Technology is the highest honor that the White House gives to technology innovators. It was established in 1980 by Congress to help promote and highlight indigenous technology development.