HP offers Integrity servers with Montecito chips

Hewlett-Packard is launching two servers using Intel's new dual-core Itanium chip in a bid to gain market traction for the troubled Itanium line.

HP's Integrity rx3660 server, with a base price of $10,531, and rx6600 server, which starts at $14,771, will be introduced Thursday and feature Intel's Itanium 2 "Montecito" processor. Intel introduced that processor in July. HP is also offering a Montecito upgrade throughout its existing Integrity line.

The industry is watching to see if Montecito will improve Itanium's competitive position against IBM's Power 5 chip architecture and Sun Microsystems' Sparc. It also remains to be seen how many server vendors beyond HP will embrace Itanium.

"I would describe this as a marathon," said Don Jenkins, vice president of marketing for the Business Critical Server Division of HP, in Palo Alto, California. "It takes a long time to establish a new architecture in the market. It took IBM a long time to establish Power."

HP introduced its first Itanium server in 2001. But by the end of 2005, servers based on the processor accounted for less than 1 percent of the market, based on units shipped, according to research firm Gartner, and 85 percent of them were sold by HP.

But by another measure, Itanium is growing. Today, close to 9,000 software applications run on Itanium, said Jenkins, up from about 100 in 2003, which gives Integrity broader appeal to enterprise customers.

"Customers can't use the server until they have the applications and the application vendors don't want to invest in the applications on that chip until they see the demand for it," he said.

Several important software vendors also announced Thursday their support of Integrity running Montecito, including BEA Systems, RSA Security, and Comverse Technology.

"HP has been steadily adding to the Itanium portfolio," said Gordon Haff, an analyst at Illuminata.

But few other server vendors are following HP's support of Itanium, Haff added. Fujitsu Ltd. announced in August it will introduce a server running Montecito, as did Silicon Graphics. But they are "small players" relative to vendors like Dell, Sun, and IBM, which are not using Itanium.

Still, Haff said, Montecito "is a nice upgrade to the Itanium."

Integrity is HP's high-end server for business-critical applications. Montecito is the first Itanium design to offer hyperthreading, virtualization and multiple cores, which increase Integrity's performance.

The Integrity rx6600 running Montecito performs close to 350,000 transactions per minute (tmp), more than twice the 161,000 tmp of an Integrity running an older version of Itanium, according to tests by the independent Transaction Processing Performance Council. Montecito is also more cost efficient, operating at $2.24 per transaction minute, versus $3.94 on a previous Itanium chip.

But skepticism remains.

"$2.24 is good but they're still not the most powerful system," said John Clabby, president of the IT research firm Clabby Analytics. "Montecito is an improvement, but it's not a leader and that's what Itanium was supposed to be."

The fastest processor tested by TPC is an IBM Power 5. which topped 4 million transactions per minute a with a cost per minute of $2.97, noted Clabby.

HP's Jenkins downplays the significance of IBM's performance numbers, noting that most enterprises only need servers that can perform 150,000 to 300,000 transactions per minute.

"Four million is a benchmark that doesn't have any relevance other than bragging rights," Jenkins said.