There is a benefit for enterprise IT managers in the growing dominance of Intel in the server marketplace, but there is also a downside.
One benefit is that corporate buyers get a well-known and well-understood platform on which to build. And as the Intel processor line grows, particularly with the release of the 64bit Itanium 2, there is every chance that Intel will be the de facto server platform for all but the most niche of niche applications. That is a safe position for most companies, and leaves managers free to concentrate more on the actual applications.
One downside is that when a commodity Intel platform is not suitable, firms will have to pay a lot for hardware. Another downside is that Intel's growing dominance will mean there is less to differentiate different brands of servers. As a result, IT buyers will face a great deal of marketing hype as server manufacturers try to convince them that there really are big differences in servers built from the same core components and sometimes the same motherboards.
Another problem for IT buyers at the moment is that there is a debate about the suitability of Intel's Xeon processors for servers. This is illustrated by the widely reported disagreement between IBM and HP over their respective Xeon-based servers. For anyone who missed the news, HP delayed releasing a Xeon-based eight-processor server, originally of Compaq design, because of disappointing performance by the processor in that configuration.
It has also poured scorn on IBM's rival system, the x440 server, suggesting that it does not perform well when using more than four processors. Of course, IBM denied the claims and said that its own design includes a proprietary Level 4 cache, giving it an advantage over standard Xeon implementations .
While there may be truth in IBM's argument, the number of server manufacturers able to follow it in offering proprietary tweaks is small and is likely to get smaller.
Intel is already talking about pricing for Itanium 2-based servers, and has suggested that a two-processor system should cost about $41,000 (£28,000).
This price will fall rapidly - Moore's Law says it should halve in 18 months, and if AMD's Opteron chip starts to make any impression on the market it could well fall faster. Xeon-based systems are already selling for about $25,000 (£17,000), according to Intel.
Intel is already a significant supplier of motherboards with processors, and there is every chance that it will gain a good share of the Itanium motherboard market. So there will be no reason for users to take any notice of squabbles between the likes of IBM and HP because the hardware will be standardised.
Instead of arguing about hardware, vendors should be boosting the aspects of their businesses that add real value, like service and support. That is why Dell has just bought a services company.
This trend suggests HP's strategy may not be wise. It plans to walk away from large sections of the middleware market, where it could have a significant advantage in providing added value.
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