Intel's New Chip: Powerful & Power Hungry

Includes: AMD, INTC
by: Robert Zenilman

Rob Zenilman submits: In today's Wall Street Journal, Don Clark's Intel Introduces Chip Targeting AMD Stronghold describes Intel's (NASDAQ:INTC) latest entry in the server silicon wars. Intel's new Xeon chip (code name "Tulsa") directly targets AMD's (NYSE:AMD) Opteron, which establishing itself in servers using four or more CPUs. AMD recently scored a coup by having IBM (NYSE:IBM) and Dell (NASDAQ:DELL) commit to use Opterons in their servers (even though they know Intel had a new chip in the pipeline).

Tulsa's advantages:

  • Tulsa has 16MB of internal memory, double its predecessor.
  • Intel claims that Tulsa is 17%-42% faster than Opteron. AMD denies that this is the case in real world operation.
Tulsa's main disadvantage is that it uses 150W of power, compared to 95W for the Opteron

Comment: This is turning into a slugfest between AMD & Intel. AMD responded to Intel's Core Duo by purchasing graphic chip maker ATI (ATYT). AMD has recently been making inroads by signing up Dell (DELL) and increasing its market share in server processors.

The higher power consumption of the Intel chip could have consequences. A recent NY Times article
discusses how Google (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT) and Yahoo (NASDAQ:YHOO) are looking to build data centers (server farms) in locations with cheap electricity. While Google currently has 450,000 servers, Microsoft expects to increase its number of servers from 200,000 (today) to 800,000 (in 2011). Given that each server has at least 4 microprocessors, 55W becomes significant. See: Second quarter conference call transcripts for Intel & AMD