AMD Gooses Dual-Core Opteron Speeds, Cuts Prices

Published: August 8, 2007

by Timothy Prickett Morgan

Chip maker Advanced Micro Devices this week made good on its promise to increase the clock speed on its dual-core Opteron Rev F processors for servers and workstations, which it said it would do back in April when it last increased clock speeds on the parts. The company also slashed prices on its first-generation Rev E chips (which had one core per chip) and second-generation Rev F Opteron processors in an effort to make life a little more difficult for rival Intel.

Back in April, the speed of the top-end Opteron part, which is called a Special Edition because it has a thermal design point of 120 watts instead of the 95-watts of the regular Opteron parts, was cranked up to 3 GHz and made available as the Opteron 2222 SE for two-socket servers and as the Opteron 8222 SE for machines with four or more sockets in a single system image.

This week, AMD is announcing two new parts that run at 3.2 GHz, the Opteron 2224 SE for two-socket boxes and the Opteron 8224 SE for bigger machines, that provide a modest speed bump for customers who need the absolute fastest chips they can get for their workloads. More importantly for the server and workstation market as a whole, the announcement of these faster Opteron SE parts comes alongside the launching of 3 GHz Opteron 2222 and 8222 parts in the 95-watt thermal envelope. The Opteron 2224 SE chip costs $873 in 1,000-unit quantities, while the Opteron 8224 SE costs $2,149. This is exactly the same price that AMD charged in April for the 3 GHz Opteron SE parts.

AMD also this week announced a 103-watt Opteron 1222 part running at 3 GHz and in the 95-watt thermal envelope, which costs $360. This dual-core Rev F chip is used in single-socket servers and workstations. AMD has also sifted through its bins to find 95-watt versions of the Opteron 2222, which now cost $698, a price cut of 20 percent. The Opteron 8222 is now a standard part, too, and it costs $1,514, down 30 percent.

With the quad-core "Barcelona" Rev F chips only a few weeks away from launch, getting an extra 200 MHz into the field, or dropping the thermals by 25 watts for a 3 GHz part, is not a big deal. But it is something, and AMD needs to ramp up clock speeds as much as is practical to compete against a reinvigorated Intel. Intel's quad-core "Clovertown" chips might not be as elegant in design as the forthcoming Barcelona Opterons, but Intel has sold well over a million of these chips since launching them late in 2006, and that counts for a lot more with Wall Street and with the server vendors of the world, who want to sell iron, not promises.

AMD knows this, of course, which is why it hasn't just cut prices on those two formerly Opteron SE parts running at 3 GHz, but across its first- and second-generation Opteron chip lines. Excluding a bunch of Opteron standard and Highly Efficient (HE) parts that have been killed off among the Rev E family, the price cuts on the single-core Rev E chips range from 18 percent to 32 percent.

With the addition of the new parts to the Opteron Rev F lineup, AMD just shifts each chip below the new top-end part into a lower price band, which results in price cuts that range from 17 percent to 30 percent across the Rev F line.

While AMD needs to cut prices to get rid of inventory--particularly if it plans to price the future quad-core Barcelona chips aggressively--such deep price cuts can stimulate demand or widen a price war that can be deadly to the bottom lines of both AMD and Intel. Until Barcelona is out the door and all the dust settles in terms of pricing, performance, and performance per watt, it is hard to say what affect AMD's price cuts will have. AMD is clearly hoping to gain share and stimulate demand, but if Intel counters with its own price cuts, nobody but the end users are going to win in this war.

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