The Opteron Advantage

At Comdex, Sun and AMD announced a strategic alliance that will combine AMD's 64-bit Opteron processor with SunFire systems for both Solaris and Linux operating systems, along with enterprise Java software running industry-standard x86 architecture. The two companies say they will introduce a full line of Opteron-powered SunFire systems, both two-way and four-way, this year. The alliance also includes long-term joint technology development for both hardware and software offerings.

For Sun, the AMD deal essentially gets it back into high-performance computing discussions and gives the company a path to 64-bit upgrades, while opening doors for Solaris. But the bigger benefactor of the partnership could be AMD.

"This has a big boost of momentum to develop revenue and enterprise business for us," says Dirk Meyer, senior vice president of AMD's Computation Products Group. "While we will see some incremental revenue from this deal, overall it is more about the strategic importance to us both."

At first glance, it may look like white-box makers will be competing with Sun for 64-bit business, but solution providers are taking a big-picture view of the market. For example, Shawn Harty, president of New Technology Solutions, a Lowell, Mass.-based systems builder, believes the Sun alliance will increase Opteron's exposure and build AMD into more of a household name.

"Sun building Opteron servers can only help systems builders, as well as AMD, because the problem is getting the interest of the end users," Harty says.

There are a few tangible benefits for AMD white-box makers as well. First and foremost, Sun and AMD are planning worldwide marketing activities, including a customer seed unit program, joint sales activities, and joint partner and channel marketing programs.

"This move is very complementary to our VARs. It gives them more opportunities to sell grid and high-performance computing and to be able to move into new markets and sell new applications," says Neil Knox, executive vice president of volume systems products at Sun.

A major bonus that both systems builders and Sun-AMD supporters see in the new alliance is that it will raise the profile of Linux and give customers more options for the server platform. Sun says that the Opteron-based SunFire systems will run open-source OS versions from both Red Hat and SuSE Linux, which was recently acquired by Novell.

"We are doing very well with the AMD Opteron with 64-bit SuSE Linux, and we have a lot of new projects from both commercial and government segments that are doing the migration from DOS-Windows applications into Linux," says Sam Chu, CEO of Polywell Computers, a San Francisco-based systems builder. "When they consider Linux, they simply consider AMD."

Chu also says that AMD machines running Linux are, of course, less expensive than Wintel servers and offer better performance for both 32-bit and 64-bit applications. "It gives real, true value to those businesses that are looking for cost optimization," he says.

The addition of Sun to the equation might make the value proposition even stronger: Its StarOffice productivity suite and new open-source OS, Java Desktop System, could be increasingly attractive offerings down the road for white-box makers leveraging AMD.

If the alliance works, Sun will have access to much-needed new markets, AMD will be an even stronger competitor to Intel, and systems builders will have even more 64-bit compatible technology for their high-performance computers.