Intel Goes Green With New Xeon Processors

Intel (Nasdaq: INTC) welcomed two new additions to its family of quad-core processors Monday with the arrival of the Quad-Core Intel Xeon processors L5320 and L5310. The two server chips sport the added benefit of energy efficiency, operating on 50 watts of power.

"We are thrilled to drive further records in lower power consumption and we won't stop here. Our engineers and architects are passionate about delivering even more power-saving innovations down the road," added Kirk Skaugen, vice president of Intel's digital enterprise group and general manager of the server platform group.

The Greening of IT

The two new chips offer reduction in power consumption between 35 percent and 60 percent over the company's existing 80- and 120-watt quad-core server chips, according to Intel. The two energy efficient chips are in response to the growing demand in the IT industry for more cost-effective solutions that reduce electricity bills and the associated cooling costs.

"Intel has really responded to the industry's call to deliver unprecedented breakthroughs for datacenter energy efficiency," said Kirk Skaugen, vice president of Intel Digital Enterprise Group and general manager of the Server Platform Group. "IT managers can get outstanding quad-core Intel Xeon server performance today and at no premium to dual-core products."

The chips, which use 12.5 watts of power for each of the four processing engines, are a significant advancement, Rob Enderle, principal analyst at the Enderle Group, told TechNewsWorld, because they "provide more performance and use less power doing it.

"In effect, they are one of the biggest examples that Intel understands that green is a major emerging requirement and that they are stepping up to meet it," Enderle explained.

A Convenient Truth

Intel says servers based on the new low-power, quad-core processors are designed for dense Internet datacenters, blade servers and industries such as financial services, where the scales and densities of servers are highly sensitive to power, real estate and cooling costs. Based on Intel's evaluations, the potential cost savings for companies replacing their aging infrastructure with the quad-core Xeon processors and deploying virtualization technology can be as great as US$6,000 each year over the lifetime of each server.

For businesses, Enderle said, the more energy efficient chips will mean the possibility of a large replacement cycle for older, less efficient hardware. "This seems very likely and could be very lucrative for Intel and its partners if it accelerates, as expected, over the next two years."

Consumers will also notice a benefit, according to Enderle. This technology, he said, can prevent or postpone the need to increase cooling and power requirements for existing datacenters, avoiding or delaying the spending of billions of dollars across the segment for site upgrades and relocations.

"In addition, it could help cut power utilization with obvious savings in power cost at a time when the cost is sharply increasing," Enderle continued. "Finally, it could also allow a firm to be eligible for power company incentives -- like being exempt from brown outs -- making the technology very attractive."

Grass Is Always Greener

Typically, the first machines packing a new technology come out relatively quickly, Enderle said. Companies will more than likely be able to find them at an original equipment manufacturer (OEM) very soon. While initial volumes may be relatively low, he expects OEMs like Dell (Nasdaq: DELL), Hewlett-Packard (NYSE: HPQ) and IBM (NYSE: IBM) will "have the lines to capacity by mid-summer and related price points will stabilize by the fourth quarter of 2007."

AMD (NYSE: AMD) will also have released its quad-core chip, codenamed Barcelona, by the end of the forth quarter. The months-long head start will give Intel "a few months of clear leadership," Enderle noted. "After that, we'll have to wait for independent benchmarks of both solutions.

"Both companies are chasing each other hard," he said. "AMD thinks they have Intel beat with their as-yet unreleased part. Intel begs to differ. We'll have to wait until we can test real systems, and those tests must be done at a system level because trade-offs in design make testing at a chip level misleading."

Intel has made some strides in making up the ground it has lost to AMD over the past few years, according to Enderle. "The numbers reflect they are already doing that to some point, and this does give them a short-term advantage.

"Unfortunately, this is more of a strategic market, so evaluations are long and [businesses] may wait to see what AMD has before they move, as some of these systems have a service life of up to seven years, so folks tend to be a little more measured on how quickly they make purchase decisions," Enderle concluded.