Intel: There's money in Itanium

The once beleaguered high-end processor is finally gaining momentum, a company executive insists.

SINGAPORE--Demand for Intel's Itanium architecture is brewing in the industry, drawing even rivals like IBM into the market.

William Wu, chairman of the Itanium Solutions Alliance (ISA) in the Asia-Pacific region, told ZDNet Asia that there is a growing market for Itanium-based systems, and "if you are not in it, you'll miss it totally."

According to analyst company IDC's worldwide quarterly server market research, for the third quarter of 2006, Itanium-based systems grew 23.8 percent year-on-year.

The Itanium market now represents 11.2 percent of all non-x86 server revenue, generating more than US$700 million in revenue for the second consecutive quarter. In the Asia-Pacific region, Itanium server revenues also crossed the US$100 million-mark for the first time, Wu said, citing IDC figures.

IDC also expects the global market for Itanium-based systems to grow to about US$6.6 billion by 2009, with a compound annual growth rate of 35 percent, compared to just 3.4 percent for the overall server market.

Itanium competes with IBM's Power and Sun Microsystems' Sparc processors in the market for high-end chips used in large data centers and 'mission-critical' systems.

According to Wu, even IBM has partnered with Hewlett-Packard to make its software products available on Itanium.

He pointed out that there is money to be made in Itanium-based applications and services. "That's why software companies want to work with us," he said, noting that hardware only contributes about 20 percent of total server revenue, with software and services making up the remainder.

More apps, thanks to Montecito
The ISA was set up last year with a US$10 billion coffer to provide resources that help programmers write and optimize software for Itanium-based systems.

"Today, there are nearly 12,000 applications available on the Itanium platform provided by over 2,000 independent software vendors (ISVs)," Wu said. The alliance itself has some 120 ISV members worldwide, with a third of them based in Asia.

Part of the growing trend was credited to the arrival of the duo-core Itanium 2 Montecito processor in July this year, Wu said.

"A lot of people were waiting for it because they know they can buy it at the same price as previous generation products, and get double the performance," he said.

Furthermore, ISA members have been educating businesses on the merits of the Itanium platform, Wu said. Recently, the alliance kicked off a series of road shows in eight cities in the region, including Shanghai and Beijing.

Wu admitted that it was not always easy to convince ISVs and businesses to migrate from the Power and Sparc platforms to Itanium. Most ISVs, he said, will first question the size of the Itanium market.

"But I think if we can show them where the beef is, people will come," he added. "We are [now] hearing less of the naysayers claiming that the Itanium will die."

With the advent of multicore x86 processors that have raised the performance bar of this server segment, Wu also admitted there were people who questioned the positioning of Itanium-based systems.

But he said that Intel has always maintained a clear product positioning for the chip, noting that Itanium is designed to support 'mission-critical' applications.

"A lot of 'mission-critical' stuff is already on Itanium, but not many people know about it and that's the challenge," Wu conceded.

While Itanium processors can power 64-way servers, he said, x86 servers are not as scalable.

"People will choose [x86-based] Xeons for mainstream applications that lie on the edge of the Internet," he explained. "SMBs (small and midsize businesses) can even use it for their backend systems… But Itanium has more in terms of mainframe reliability."

In 2007, Wu will also be aiming to remove another barrier to greater Itanium adoption: customized applications on Sparc and Power that businesses are unable to port over to Itanium. This problem typically occurs when companies lose the source codes or the programmers of the applications, he said.

Transitive, an ISA member that developed software which lets Mac users run older PowerPC applications on Apple's Intel-based Macs, may just provide the answer.

According to Wu, Transitive offers a product that allows businesses to run Sun Solaris/Sparc applications on Itanium-based systems via a virtual layer, without any need for recoding. The Intel executive said Transitive currently does not have presence in Asia, but he hopes to lure the company into the region.

A similar offering from Platform Solutions Inc (PSI) also helps businesses run IBM's mainframe zOS operating system on the Itanium platform. "That's also another thing we'll focus on next year," he said.