It is no secret that Intel Itanic fail to lit the markets and push themselves onto the high end market. In fact, some of companies we work with even received offers from Intel in "buy one, get one free" or selling extra Itanium CPUs for as low as one cent (not an error), just to adopt the Itanium platform. Thus, we were not surprised to see Oracle releasing a rather short press release on Tuesday.
Oracle is the latest to abandon Intel’s HMS Itanic ship, following Microsoft, Red Hat and co. Original Picture credit: Fachhochschule Nordhausen
The company stated that they are done with developing for Intels Itanium CPU architecture. They justify their move with stating that Intel’s strategic focus has shifted towards x86 and that other companies like Microsoft and Red Hat stopped software development as well. They even go on to state that HP’s new CEO Leo Apotheker didn’t even find it worth mentioning Itanium in a presentation about HP’s strategy for the future. Given that HP is one of co-developers of the architecture, even Wall Street analysts took notice. To their credit, Oracle will continue to provide support for existing software designed for Itanium.
Yesterday Intel was quick to assure that Itanium is still going. "Intel’s work on Intel Itanium processors and platforms continues unabated with multiple generations of chips currently in development and on schedule," said Intels CEO Paul Otellini in a press release. For 2012 Intel plans to ship the 8-core 32nm Itanium chip codenamed Poulson, which was demonstrated on ISSCC earlier this year. The behemoth is said to measure 544mm2 in die size and features 54MB of cache overall. Further down the road Intel plans a successor dubbed Kittson. At the Beijing IDF Intel wants to talk about Itaniums momentum in a keynote. At this point talking about momentum in this regard sounds a bit questionable in my book. To add to the irony, Intel discontinued Itanium support in the latest version of their own compiler suite.
If that wasn’t enough already, HP who commands about 95% of Itanium marketshare also had to chime in with their own press release. It even claims their Itanium server platform based on their HP-UX operating system has a roadmap planned for another decade. Considering the future iterations Intel announced and the long product lifecycles in this segment, this even sounds credible. The rest of their statement is filled with aggressive statements towards Oracle. HP also states that they superseded Sun and consequently Oracle in Unix market-share. HP believes this latest move is a desperate attempt to increase market-share of SPARC-based servers. They even encourage customers who don’t agree with this move to email Oracle, which can be described hilarious at best. Here’s a snippet from HP’s press release:
"Oracle continues to show a pattern of anti-customer behavior as they move to shore up their failing Sun server business," said Dave Donatelli, executive vice president and general manager, Enterprise Servers, Storage and Networking, HP. "HP believes in fair and honest competition. Competition is good for customers, innovation and the marketplace. We are shocked that Oracle would put enterprises and governments at risk while costing them hundreds of millions of dollars in lost productivity in a shameless gambit to limit fair competition."
The public back and forth bashing of each other by Oracle and HP can only be described as a jerk move. If we didn’t know better, we’d have to think the whole story is about two kids duking it out in the backyard of a school. The rest of the story is not funny at all, at least if you look at the hard numbers. A graph courtesy of Wikipedia depicting how sales forecasts have been corrected over the years after the initial release of Itanium speaks more than a thousand words. Only in 2009 former Intel senior executive Pat Gelsinger stated "The Itanium business is now profitable."
It remains to be seen where the journey goes, but any educated guess points downwards, akin to where the Titanic went after hitting an iceberg. The sarcastic analogy Itanic has been around since the release of the processor architecture. At this point most passengers have left the sinking ship, but Intel and HP seem hellbent to stay on board. After all, they sank all the money into the Itanium architecture (at a cost of four billion USD to HP alone) and killed DEC Alpha, which was the superior architecture.
At the end of the day, Oracle ditched Itanium. HP and Intel blasted Oracle, and as expected – the company did not remain silent. Just in time for the closure of this article, Larry Elisson, ex-HP CEO Mark Hurd and others joined the frame and answered Intel/HP in a very blunt manner:
"Just the opposite is true," Oracle said with its latest volley in the Itanium skirmish. "Oracle has an obligation to give our customers adequate advanced notice when Oracle discontinues development on any software product or hardware platform so our customers have the information they need to plan and manage their businesses."
"HP is well aware that Intel’s future direction is focused on X86 and that plans to replace Itanium with X86 are already in place. HP is knowingly withholding this information from our joint Itanium customers."
What do you think? Is Oracle right or wrong – are Intel and HP desperate to hide the fact that Itanic is going the do-do bird route, with once estimated 40 billion U.S. dollar business not even being at 10% of that figure. Bear in mind that a $40 billion revenue was supposed to be reached exactly a decade ago (as you can see in an image below)?
Collection of Intel’s public sales estimate figures over the past 12 years. Picture Credit: Wikipedia