GuidesFallout From Dell's Itanium Decision

Fallout From Dell’s Itanium Decision

ServerWatch content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More.

At least one competitor wasted no time trying to capitalize on the news that Dell will stop making servers based on Intel’s Itanium processor.
IBM may be spinning Dell’s pullback on Itanium as a major blow to HP, but analysts aren’t so sure.

Dell’s decision was described as “a staggering blow to [Itanium] co-designer Hewlett Packard, which invested more than a billion dollars over the last decade in a bid to win the hearts and minds of millions of computing systems buyers,” in an e-mail sent to by IBM’s Systems Group.

Whatever its effect on HP, Dell, while one of Intel’s staunchest allies, was in fact never a strong supporter of Itanium.

The Round Rock, Texas, computer maker said yesterday it would stop making systems based on Itanium and would instead continue using Intel Xeon-based servers for its high end offerings. Dell was not available for comment, but an Intel spokesperson confirmed Dell’s decision.

“Based on Dell’s business model, the volume server market, their decision makes sense and we continue to work closely with them in other areas,” said Intel spokesperson Erica Fields. “We have seventy-five OEMs that sell and support Itanium and [Dell’s] impact on sales was small compared to the rest.”

IBM’s high-end Power architecture servers compete directly with HP, which is by far the leading provider of Itanium-based high-end servers. HP strongly disputed the assertion that Dell’s decision will hurt its business, much less the overall market for Itanium systems.

“Dell is a supply chain driven, keep it simple, keep it high volume supplier and anything else doesn’t fit their business,” Brian Cox, director of worldwide server marketing for HP, told “Once you get into a more consultative sell it really doesn’t fit their business model.”

Itanium was originally conceived as a mainstream processor with the potential to replace Intel’s mainstay Pentium, which made Dell a natural supporter. Over time, the target market for the sophisticated Itanium processor shifted to high end servers and supercomputers, where Dell is not a player.

Cox noted that Dell at one point tried unsuccessfully to resell high end Unisys systems which, similar to Itanium-class systems, required substantial customer support, service and staff training.

“Dell could figure out a way to sell Itanium, but they sell commodity stuff. It really doesn’t fit their business,” said Clay Ryder, analyst with Sageza Group.

Still, Ryder believes the loss of Dell is significant in that Itanium has few marquee name supporters beyond HP. Also, by committing to Itanium, Clay asserts, HP has essentially “told its customers running older DEC, Tandem and PA-RISC  ‘Your platform’s dead and we’re shooting it for you.'”

One of the criticisms of Itanium is that it is not binary compatible with x86-based platforms, so PC applications and those from other systems have to be compiled to run on it. Ryder argued that the migration path for HP’s existing customers is just as hard to go Itanium as to any other system such as from IBM or Sun.

HP’s Cox strongly disputed that notion.

“We designed Itanium with Intel, so we made sure applications are compatible with what runs on PA-RISC. You can take an HP-UX application and run it on Itanium. Also, all the management tool suites from systems like the HP 9000 have the same look and feel on Itanium and it uses the same storage products.”

For its part, Intel is using its considerable resources to back Itanium to the hilt with several generations already on the drawing board. The first dual-core Itanium, Montecito, is slated for release later this year. Intel is promising double the performance from Montecito versus the current single or unicore “Madison” Itanium. Four-core Itaniums are also being developed.

Intel and several high profile partners, including Microsoft, Oracle and HP, are expected to announce a consortium later this month designed to further promote and develop the market for Itanium systems. One goal is to help developers port applications to the platform. A public relations official for the group said no one was available to comment on the Dell decision because they were all meeting in Paris this week working out final details of the announcement.

This article was originally published on

Get the Free Newsletter!

Subscribe to Daily Tech Insider for top news, trends & analysis

Latest Posts

Related Stories