Intel Plans Low-Power And Dual-Core ChipsIntel Plans Low-Power And Dual-Core Chips

The battle over the x86 server market has become more intense as Advanced Micro Devices Inc. gains some momentum and market share. Intel fired back last week with details of a microprocessor product road map for the next year that includes a strong focus on lower-power chip options and plans to spend $3 billion for a new chip factory.

Since introducing its Opteron processor for servers a little more than two years ago, AMD has moved from a nonfactor to an 11.2% market share in the second quarter of this year, according to Mercury Research. That still leaves Intel in command, but AMD's momentum can be attributed in large degree to its technological advances, with AMD offering the only dual-core x86 processors available in the market.

Intel plans to come on strong in the next year with a full-scale migration to dual-core processors. Intel projects that 85% of all its server processors shipped by the end of 2006 will be dual core. That's only slightly behind AMD's projection that 90% of all its server processor shipments will be dual-core by the end of next year.

The market-share gain by AMD "was very dramatic," says Dean McCarron, an analyst with Mercury Research. "Clearly, one or more of their customers [purchased] substantially more product in the quarter."

Intel is establishing four lines of server processors with a new numbering system. "We think this type of numbering scheme will help simplify things as we go to dual-core devices and add even larger caches," says Kirk Skaugen, general manager of Intel's server-platforms group.

Intel is establishing three Xeon levels based on performance and power dissipation, which is the amount of heat the processor generates. Some businesses have found it difficult to cool rooms filled with servers or racks of servers, which can generate substantial heat. So chips that use less power and generate less heat will appeal to server makers and businesses that use lots of servers in their data centers.

Intel plans a high-end, performance-optimized line; a rack-optimized midvoltage line; and an ultra-dense low-voltage line. Beginning in the second half of this year, Intel plans to offer a performance-optimized Xeon with 110 watts of power dissipation, midvoltage devices at 90 watts, and low-voltage devices at 55 watts. All will be single core.

Intel will add dual-core versions beginning in the first half of 2006 as it also shifts processor production from 90 nanometers to 65 nanometers. That transition will include introducing the low-voltage Sossaman processor, which will be based on the Yonah core now used in Pentium M technology found in Intel's mobile-desktop platform, and will have power dissipation of 31 watts. Intel promises an additional refresh of processor lines in the second half of 2006 that's expected to result in improved power dissipation for the performance-optimized and low-voltage Xeon processors.

Intel, which already has the most chip-manufacturing capacity in the world, also disclosed it will build a $3 billion chip factory in Chandler, Ariz., which will begin using a 45-nanometer process in the second half of 2007 to build a new generation of microprocessors.

The new plant highlights Intel's lead over AMD in two key areas: capital spending and next-generation microprocessor manufacturing processes, which lets the company put more computing horsepower in smaller areas.

A report by IC Insights in April showed that Intel, with a capital budget of about $5.6 billion this year, will spend more in capital expenditures than AMD's total revenue for the year. AMD's capital budget for 2006 is estimated at $1.5 billion.