Dell snubs Intel's Itanium 2

Bad(ish) news for chip giant...

Computer maker Dell has confirmed it will not be part of the launch of Intel's all-new 64-bit Itanium 2 processor on Monday. The Itanium 2 - codenamed McKinley - is Intel's latest stab at getting into the high-performance server market, and is a follow up to the Itanium, which struggled to garner industry interest. Given Intel's problems in persuading OEMs (original equipment manufacturers) - the people that make the computers based on its chips - to invest in the original Itanium, Dell's decision not to ship Itanium 2 systems is a bitter blow to the chip maker. A spokesman for Intel said: "We still have in the region of twenty OEMs planning worldwide releases on Itanium 2, and Dell still has a strong commitment to the Itanium 2 platform - we expect them to adopt systems in the future." In a statement Dell said it was because the high-volume demand was not yet there for the systems, and because the market for software to run on them was not yet mature. However, it denied this means it is exiting the 64-bit arena. Itanium 2 is the second generation of Intel's long-heralded 64-bit chip family, which is supposed to deliver higher performance in the long term. Both IBM and Sun have been selling high-end 64-bit systems for a number of years, but so far Intel has failed to match this, instead concentrating on selling higher volume, but lower margin, PC chips. Itanium 2 is Intel's chance to move into this arena, but is also a fundamental platform change for the future of the computing industry. Uptake of Itanium 1 has been slow and the longevity of the entire architecture has been questioned in some quarters. Analysts say Dell's refusal to line up alongside other computer makers at the chip's launch will not damage sales of the Itanium 2 hugely, because Dell prefers to concentrate on more commoditised, lower-end machines. However, the decision does cast a shadow on a launch where Intel may have expected the major industry players to have at least publicly demonstrated their support for the chip. Andy Butler, VP for Gartner Group, said: "Intel would have wanted a public endorsement from Dell here, even if it wouldn't have expected the firm to ship a huge volume of products. "Acceptance of Itanium has been slower than expected, and now large volume sales are not a reality probably until the next generation, or maybe even the one after that. In this climate it is a challenge for Intel to maintain confidence in the platform, and that's exactly why they would've wanted Dell on board." The next generation of chip, dubbed Madison, is not due out for another 12 months. Robin Bloor, CEO of analyst house Bloor Research, said: "There is still a fairly big question mark in this industry over whether a 64-bit architecture is even needed from Intel - certainly for those companies that have got 64-bit systems like IBM, it hasn't proved a killer advantage."