AMD Continues Push into Server Chip Market

AMD continued pushing its way into the Intel-dominated
server chip market, releasing the latest in it Athlon MP processor line, the

The new chip represents a switch in its server chip line to 0.13-micron
copper process technology. The 0.13-micron manufacturing technology, as
opposed to traditional 0.18-micron, allows processors to achieve higher
performance while lowering power requirements, all on a smaller die size.

The 2200+ is the third and final member of the AMD Athlon processor family
to transition to 0.13-micron copper process technology. AMD Athlon
processors for mobile and desktop systems transitioned earlier in 2002.

While AMD has been battling with Intel in the PC
processor market since the eighties, the company recently moved in on the
server chip front with only modest success.

“AMD hasn’t had a huge amount of luck moving in (on the server market),”
said Gordon Haff, an analyst with Illuminata. “The problem they face with
the server market is that people pay more attention to the brand of the
components that go into the servers and are more inclined to purchase more

Intel’s brand loyalty, coupled with AMD’s minor price and performance
differentiation, could make AMD’s entry into the server market a rocky road.

According to Haff, the company may have to wait for its release of Opteron
to make its big push into the server chip market. Opteron, the
multiprocessor capable based parts of “Hammer,” is a family of processors
designed to provide high performance on 32-bit applications while allowing a
migration path to 64-bit applications.

“That’s going to be the pivot point where AMD has an opportunity to
differentiate themselves from Intel,” said Haff. “If they are going to
succeed in the server market it is going to be on the back of Opteron.”

AMD is expected to start releasing products in the Opteron family later this
year or early next year. Intel recently released its own 64-bit chip,
Itanium and is also rumored to be working on a similar 32-/64-bit migratory
product to rival AMD.

Despite slow entry into the business market, AMD, has had some good news in
recent weeks, including a strong push last week following a deal with HP
, the largest PC maker, to use its Athlon XP chips in one
PC model, the D315, aimed specifically at business users. While HP, and
other major PC makers readily use AMD chips in many consumer-based PCs, the
deal marked the first major PC maker to use AMD chips in the business.

Haff notes that while this presents a big opening for HP, the scope will be
determined by how HP proceeds with AMD in other parts of its line.

“To what degree HP is really committed to using AMD in a broad range of
systems, we will see,” said Haff. “This certainly could be merely HP showing
off some market independence from Intel and using AMD in a token way.”

Along with the newly released MP 2200+, AMD is offering its AMD-760 MPX
chipset, to provides high-speed peripheral connections compatible with all
AMD Athlon MP processors.

Systems featuring the AMD Athlon MP processor 2200+ are expected to be
available immediately from approximately than 35 manufacturers worldwide,
with chip prices set at $224 based on 1,000-unit quantities.

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