Itanium News
Some comments (dated December 20, 2004) on the contractual relationship between HP and Intel:
The IT press was having a field day earlier this week as rumors were circulating about that a staff of chip designers that Hewlett Packard Co has had stationed in Fort Collins, Colorado assisting with the design of the Itanium chips with partner Intel Corp had been moved to Intel. The interpretation of what this small move meant was nearly uniform - that HP was in back-handed way washing its hands of Itanium - and it was also completely ass backwards.
There's a reason why those Colorado chip creators have been moved to Intel, and while neither HP nor Intel will come out and say why, this is very likely the reason: Intel has no choice but to take them as part of the complex and secret contract between HP and Intel that created the Itanium chip....Intel...would have probably killed off Itanium a year or two ago (we surmise) if it were not for one fact: Intel has a contractual arrangement that forces it to supply HP with Itanium chips, probably so long as HP desires them. And with HP-UX and now OpenVMS ported to and soon to be only available on Itanium, HP most definitely wants those Itanium chips for its Integrity-based servers. If Intel kills Itanium, then HP will sue it for breach of contract.
This is the only explanation that makes sense. And when I ran the idea past Don Jenkins, vice president of marketing for HP's Business Critical Systems unit, he said that this was absolutely correct. "Yes, absolutely, Intel has a long-term commitment to supply the Itanium," he said. And...he said that there is absolutely a legal contract that assures that Intel has to supply HP with chips....HP's commitment to Itanium, regardless of all the naysayers, is precisely as strong as the unavoidable fact that its HP-UX, OpenVMS, and NonStop operating systems are only going to be available on Itanium chips in Integrity systems in the not-too-distant future....
However, this may only be part of the story:
"The cost reduction that HP sees by moving the Itanium team to Intel is about $50 million a year," Gartner analyst Martin Reynolds told internetnews.com. "This is insignificant against a billion dollar market development expense. HP is clearly confident about Intel's commitment to Itanium or they would not have done this."
HP's exit from Itanium's design, however, ends a 16-year semiconductor design relationship between the two Silicon Valley powerhouses. The shift away from contributing to Itanium follows HP's decision to no longer put Itanium processors in its high-performance workstations.
"They are done with what they hoped to accomplish with Itanium," John Enck, an analyst with Gartner told internetnews.com. "HP needed to replace their PA-RISC systems and include attributes like support for Non-Stop and Open VMS to survive processor failovers in their high-end systems. Now that the Intel roadmap has all of those aspects on it going forward, I would argue that is why they are getting out of the design process."
The departure does make it easier for Intel to sell its Itanium chip designs to other high-end computing companies like IBM, and Fujitsu....
Reynolds suggests HP's departure bodes well in for Itanium as a whole since, "Its performance progresses in fits and starts, and Intel should be able to sort this out now that it owns both teams," he said.
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