Business, Graphics, Hardware

Intel re-opens Larrabee talks with AIBs: EVGA, XFX?


Currently, there isn’t a project in Intel that is pulling more resources [both human and financial] than Larrabee. Given the status of the program, we are not surprised to see top engineering dogs from CPU divisions flying between Larrabee centers, pulling everything together in order to get Larrabee out the door during 2010. Our sources still say that product introduction prior to CeBIT 2011 is unwise and risks damage to Intel’s brand image, given the immature state of the project.

Then again, we’ll see who will win – engineering attitude is now in the front seat. It is more than obvious how marketing had its way with Larrabee so far, and while talking crazy promises to the press or analysts ["We’ll have a 32nm CPU die and 45nm Larrabee die for notebooks in May 2009" – former Intel Exec] can’t cost you more than a temporary stock bump or downgrade, talking the same to eco-system who then has to invest serious money into preparing their own infrastructure – can cause a loss of several million real-world dollars. For instance, we learned that one whole marketing campaign [digital future livelihood] was created for Larrabee and ultimately used on a product line from Intel’s competitors speaks volumes in what situation some AIBs found themselves in.

In order to compensate for the lost investment that angered partners who signed and invested significant resources in preparation for "Larrabee coming in first quarter 2009", Intel had to change the attitude from "we’re almighty" to "we know we screwed up". In fact, in conversations with our sources, it was interesting to see the change that showed to them how Intel managed to eat a humble pie and wants to talk on equal terms.

Furbie - this is how some partners are calling nVidia's GF100/GT300/Fermi ArchitectureThis is quite significant change, since back in 2007 and 2008, we were hearing AIBs telling us of the attitude by top Intel Larrabee guys such as Patrick P. Gelsinger, Jim Woodruff and others. That attitude was that "AMD is harmless, nVidia is dead." The only two companies that signed on-board were EVGA and XFX, with several other vendors being refused due to lack of global presence. Allegedly, it was this attitude that annoyed AIB [Add-In-Board] manufacturers with some major partners refusing to commit to the program. However, in the light of Larrabee troubles and missed deadlines, Intel actually turned into a more responsible company. Intel also had one unexpected ally – according to our sources, nVidia is refusing to eat the humble pie even though they massively screwed up with GT300/Fermi/Furbie and that’s angering a lot of people in their ecosystem.

The difference in attitude between companies with delayed products is quite interesting: while nVidia is now putting majority of GT200 chips in Tesla cards [due to a recent sea of orders] and leaving their GeForce partners to bleed dry, Intel has re-approached its previously signed partners and some hopefuls with a new attitude. The chip giant is now offering to bundle chipsets at "rock-bottom to free" prices with Larrabee cGPUs as a compensation for created expenses. Before you cry foul and "antitrust", this is a standard business practice of compensating for previous screwups made by one party. This is nothing unusual.

For example, when Airbus delayed A380 Superjumbo plane by two years, the manufacturer had to pay couple over a billion dollars to airline companies that expected the plane on time – the rumor had it that for each delayed frame [plane], Airbus SAS had to cash in around six million dollars [192 planes were on order at that time]. So far, Boeing had to compensate for its 787 delay to the tune of 11 billion dollars, given that the plane is yet to fly [according to their promises, there were supposed to be 120 787 flying by the end of 2009]. Just like Airbus and Boeing compensated airlines with significant discounts measured in billions of dollars [several Airbus customers got 50% off on A330 planes, Boeing even gave several 777-300ER for free and 50-70% discounts on other frames], Intel is now doing a similar [responsible] thing.

Competition is always good and the entrance of Intel can only be good for the graphics industry in general – AMD and nVidia grew too lenient and treat their partners like crap [in their own words], and Intel is viewed as being a game changer, since both AMD and nVidia "have to wake up and smell the coffee" and start treating their partners right, or risk them joining the "sponsors of tomorrow."

As one source told us, "AMD believes their future is fusion, nVidia is maybe the way it’s meant to be played, but Intel is sponsor of tomorrow."

Update November 7, 2009 at 19:09 GMT – Following the publication of our story, we got contacted by Intel lead spokeperson for Larrabee, Mr. Nick Knupffer. Nick informed us that this story is allegedly based on Digitimes story that was "a complete fabrication. Digitimes have since altered their story, as have most sites that wrote about it too. Much of this story, (including the bundling allegation) is sheer invention."

Nick however, refused to dismiss did talks with EVGA and XFX took place or are they on board as far as Larrabee AIB partners go. According to Intel’s CEO, we are going to have to wait until 2010 to learn who is and isn’t on Larrabee’s boat. All we can say is that the basis for our story was not story published on DigiTimes, since DigiTimes implied that Intel’s CEO discussed Larrabee with potential partners. We do agree with Nick that is a complete fabrication. We do stand by most elements of our story, and unless we get the permission to publish the confidential contracts, we are moving this story into a rumor section. As my old publication used to write, all stories come true.