Intel to Announce Opteron Competition

Today, Intel is expected to release its long-awaited Woodcrest chip, a dual-core Xeon processor that uses the chip maker's new Core microarchitecture to provide better CPU performance in cooler-running packages.

Intel is hoping that Woodcrest, the first of several next-generation processors scheduled to debut in the next few months, will help it regain footing in a server market that increasingly emphasizes higher performance and lower power demands.

Woodcrest is designed to run applications more energy-efficiently by letting each core in a multicore system handle a larger number of instruction sets simultaneously. Another feature that should boost performance and reduce power consumption is a shared Layer 2 cache that is allocated dynamically according to the needs of each core.

Every major server vendor--including Dell, HP, and IBM--plans to introduce servers based on the new Xeon Monday.

"This really does get Intel back on the right playing field again," says Gordon Haff, an analyst with Illuminata. "This release is a pretty big deal for Intel because this is the first time in a while that you can look at the technical specs of [Opteron and Xeon] products and say this is really competitive."

Price War?

The renewed competition should be good news for enterprise buyers, as chip makers Intel and Advanced Micro Devices square off on price, Haff says.

"There has been speculation that the Woodcrest launch is going to touch off some price wars between AMD and Intel as Intel tries to get some share back," Haff says.

AMD has been chipping away at Intel's domination of the x86 market. In April, AMD cited numbers from Mercury Research that it had increased its share of the market from 16 percent in the fourth quarter of 2005 to 22 percent in the first quarter of this year. A year ago, AMD accounted for just 7 percent of the x86 market. Intel holds most of the remaining market.

AMD's biggest gains have come at the high end. According to Gartner, AMD accounted for 29 percent of all four-socket server shipments in the first quarter of this year, compared with less than 1 percent in 2003. Intel held about 53 percent of the four-socket server market in the first quarter.

A major reason for the market share gains is Opteron's Direct Connect Architecture, which enables the chip to perform better with lower power demands. The Direct Connect Architecture links the CPU directly with memory, I/O and other CPUs, and eliminates traffic bottlenecks that can occur when the system moves data on and off the processor via a front-side bus, which Intel's Xeon chip uses. In addition, Opteron's on-chip memory controller gives the CPU a boost when the PC transfers data between the processor and the rest of the system, analysts say.

Though analysts don't expect Xeon to have an on-board memory controller for some time, they say that the new architecture could help Intel start to erode some of Opteron's edge by doing more work with less power.

More Intel Announcements Expected

In addition to Woodcrest, Core architecture processors for the desktop, code-named Conroe, and for mobile computing, code-named Merom, are scheduled to begin shipping over the next few months.

"AMD isn't standing still here, so Intel can by no means sit back and relax," Haff says. "But it must feel good for them to at least get a product out in the server space that for the first time in a couple of years really is functionally comparable to what AMD has to offer."