Dell Still Intel Only 399
wyckedone writes "Dell Computers has no plans to offer the new dual-core AMD Opteron even though it has been proven that "Opteron's integrated memory controller and multiple Hypertransport interconnects help it outperform Intel's Xeon processor on many benchmarks, especially those that measure the performance of memory-intensive applications.". HP, IBM and Sun Microsystems have all announced that they are going to release servers based on the new AMD chip. Why not offer customers an alternative that has better performance instead of risking the lose of those customers to another vendor that does? Intel has no plans to release a dual-core Xeon until 2006."
what (Score:2, Insightful)
Makes perfect business sense (Score:5, Insightful)
1. AMD can't produce enough chips to satisfy Dell's demands
2. Intel has proven a reliable platform for Dell
3. Most end user's don't care
Because (Score:5, Insightful)
Because Dell looked at the numbers and determined that the exclusively-Intel price discount that Dell gets is more valuable than the potential revenue they'd get by offering AMD.
Business Choice (Score:5, Insightful)
Dell has chosen to stick with Intel which isn't the worse choice. It means lost profits but it also means less support for two distinct chips.
It is up to the above three companies to prove to Dell (and Intel) that AMD is a viable alternative by speaking with their dollars and buying Opteron servers
It would not be good for Dell's bottom line (Score:5, Insightful)
Not to flame (Score:5, Insightful)
Which isn't to say your 12 year old doesn't, but that is besides the point.
Dell's customers not asking? (Score:5, Insightful)
I think the disadvantage here is that Dell sometimes supplies companies with computers and they're the ones without a big choice. Home users tend to pick dell because it's the easy thing to do.
Re:It would not be good for Dell's bottom line (Score:3, Insightful)
Does Dell really need AMD (Score:5, Insightful)
Dell has never offered AMD. Yet they have grown to be the largest PC company in the world. HP and Compaq can combine and Dell still outperforms them. IBM decides to sell off their PC division. Sun is fighting for its life.
I'm a big fan of AMD, but the "everybody else is doing it" argument has always been a stupid one. It is more stupid when "everybody else", even combined, have withered against the "not everybody else" competition.
Dell is afraid... (Score:5, Insightful)
"B-b-but, it's Pentium 4 EXTREME Edition with HT Technology!!1one"
"B-b-but, Intel's better for gaming!"
"B-b-but, If it's not Intel Inside(tm), then it's not worth a damn!"
"B-b-but, Is Windows XP even compatible with AMD?"
Don't underestimate a company as big as Dell (Score:5, Insightful)
In the end it ALWAYS comes down to numbers. Intel probably gives Dell quite a discount for having Dell's exclusivety. Most corporate customers don't mind the performance difference, since they will never get fired for buying Intel... on the contrary, in the corporate / server world, Intel has a great reputation.
The press fanfare generated by such announcements probably is beneficial to Dell. Remember, (almost) any publicity is good publicity. Everyone that read this thread now remembered Dell exists
Don't worry, one day they probably will conclude its more profitable to also sell AMD - probably when AMD manages to give them a nice discount too
Re:SFW (Score:5, Insightful)
Re:Makes perfect business sense (Score:5, Insightful)
Business parterners that can't meet demand are a liability. AMD has a very limited manufacturing capability compared to Intel. The kind of production runs that Dell requires is something that AMD can't accommidate, certainly not as long as they're supplying HP and white box makers.
Re:SFW (Score:5, Insightful)
However, by saying publicly, "We're thinking nice thoughts about AMD" they can pressure intel to lower their prices, so as not to lose business from one of the larger home pc manufacturers.
Business as usual.
To answer your question... (Score:5, Insightful)
Any number of reasons come to mind, all pulled from my posterier based on what little I know about Dell's business model and relationship with Intel, but try any of these on:
It could be any combination of the above or something else entirely. Maybe Dell is just making a horrible business decision, but I'm guessing that they've run the numbers and decided that its in their best interests to stay the course. Decisions that seem to be perplexing to us almost boil down to money. Their financial analysts have convinced management that the company is best served this way.
Re:Makes perfect business sense (Score:5, Insightful)
No, you have it backwards. If customers didn't care, they'd pick the faster AMD chip. Home users care about what's "inside"; which doesn't mean they know any better. It's just that they've seen the commercials, and their computer "expert" friend advises to get the Intel processor. So that's what they ask for when they call Dell, and that's what Dell gives them.
Maybe the time isn't right for an alternative! (Score:2, Insightful)
Right or wrong, markets have inertia. If there isn't enough demand for AMD chips from Dells' huge corporate customers then it makes little business sense to expend effort on providing them. Unfortunately, the technology isn't the only factor here. When sufficient demand exists, expect Dell to get rather more keen on AMD products.
The other factor is AMD's manufacturing capacity. I imagine Dell would be wary about going for AMD if they had concerns about this.
Re:It would not be good for Dell's bottom line (Score:4, Insightful)
Re:Makes perfect business sense (Score:5, Insightful)
Re:SFW (Score:5, Insightful)
Weighing the options does not mean just choosing which is the fastest processor, or which is the best technology, but weighing how much outlay it would cost to retool if you want to switch.
Sometimes it's smart business to pick the lesser technology, if it keeps your costs down.
*News* for nerds? (Score:3, Insightful)
Re:Simple (Score:3, Insightful)
Another reason to use AMD (Score:5, Insightful)
I don't know how many people are thinking about the cost of infrastructure to host servers, but that is another reason to use AMD based systems.
Whatever (Score:3, Insightful)
Re:Makes perfect business sense (Score:5, Insightful)
Remember, Dell's main market is not geeks (who will build their computer from scratch anyway), it is the mass market.
Re:SFW (Score:5, Insightful)
Re:SFW (Score:5, Insightful)
One of the big things they get is first cut at the latest technology. The Dell XPS Gen5 has been announced as the first system to use Intels new "Dual Core" chips, which gets them all sorts of Free (as in Beer) advertising. Charging Dell a lower price might get them in trouble, but there are few laws about who you have to give access to early technology mules.
Because Micheal Dell likes to reduce complexity (Score:5, Insightful)
Dell would rather lose a few percent of sales that drive the costs of the entire factory higher.
Re:Simple (Score:3, Insightful)
Personally the P4 bothers me. It takes a wack of power and it's so f'ing slow by comparison...
Tom
Hardly surprising given other choices they make (Score:4, Insightful)
Especially with Intel advertising subsidies (Score:4, Insightful)
Re:Does Dell really need AMD (Score:2, Insightful)
I'm fairly sure they already have.
Re:It would not be good for Dell's bottom line (Score:4, Insightful)
The reason is the way Dell do business. They have very little inventory, and an incredibly streamlined build process. Adding an additional CPU to the mix means that it would need to be rolled out across a number of servers, meaning more components, more suppliers, more support and more staff. In the end, people buy from Dell because they're Dell, not because they sell Opterons. So the net effect here is that by competing against another 3 manufacturers in Opteron territory, they're making the choices harder for their own customers who want Dell and don't give a monkey about what's in it.
I can agree that product range is a great idea, but that's the key to confusion and lack of product identity rather than choice. I came across a company recently that sold 30 models of laptop, 44 mono laser printers and 41 types of colour inkjet. Some of those products were competing against each other and certainly didn't have time to research it so I didn't buy.
That company was HP, and I certainly think some conservative business talk could help them out right now.
Advertising is what Sells (Score:5, Insightful)
As for Dell they have always thrown tons of money at Advertising and I would dare say more than most other PC manufacturers with maybe the exception of IBM, though they typically target more business users in the ads it seems. In the end stupid commercial get stupid people to buy stupid things. The smart ones know what they are doing and will buy the best performance for the price.
Re:SFW (Score:2, Insightful)
Remind me why I should care?
One reason for some people to care is that Dell has a near-monopoly in the education market. A lot of folks at Universities want to buy AMD, especially when they've got what looks to be the best 64-bit solution, but keep getting told to just buy a Dell from their Purchasing Department.
Better performance depends on your metric (Score:3, Insightful)
Dell has their relationship with Intel all worked out. They have there supply chain all set up. They are the number one PC maker on the planet. Right now they have no real motivation to move. With IBM leaving the x86 market "are they keeping the servers?" and HP flopping around Dell is in pretty good shape.
I guess this can be a blessing in disguise... (Score:2, Insightful)
It's competition that drives every vendor, and if Dell feels they can get away without offering AMD, that's fine. But then again, when you go looking for jobs, you don't see the need to be 'well versed in Dell Poweredge servers' do you? But HP/Compaq servers... that's a necessity when applying for a lot of jobs -- it just goes to show the reach of Dell's server market anyways. I think Dell makes the majority of its cash from home PC sales, and this move only shows that -- people will continue to be stupid and buy Dells though I have to admit, for $399 I couldn't build a computer as good as what Dell sells.
Time will tell in this departement, but I do believe that Dell will fare just fine, because they prey on ignorance of customers -- home custoemrs. Business customers need the best performance for the least money, and right now (and for the foreseeable future), that will probably be AMD, and businesses will flock to that as it necessitates for their daily chores. We did it here at work, the new Opterons work quite well with SQL Server 2003
Re:Business Choice (Score:5, Insightful)
There is no reason why there can't be a viable, profitable market for AMD-based servers and for it simultaneously not to be in Dell's interest to pursue it. There's room for both Dell and Sun (and Alienware and white box vendors) to coexist, just like, believe it or not, it's possible for both Americans and Indians to have jobs.
Reverse is true, too... (Score:4, Insightful)
Dell is all about low margin *parts assembly*. Works fine for destops.
When we had a drive fail in a PowerVault 220S, Dell sent out a tech to replace the drive, and the entire RAID-5 volume got hosed. That's just simply not supposed to happen. Doesn't happen with the Sun boxes we have here, nor the CPQ/HP ProLiants. The Sun and HP boxes are engineered as systems. The Dell relied on a rebadged Adaptec card, a rebadged copy of Volume Manager, and tech support who don't know anything about how the parts work together.
If your IT stuff is done right, desktops are essentially disposable. Servers, not so much. Restoring a terabyte from tape is still a slow proposition, especially with network-based backup.
Re:Makes perfect business sense (Score:4, Insightful)
You say this because you are the World's Foremost Expert on Dell's Supply Chain Management system?
It's more than just about performance (Score:2, Insightful)
Why does this surprise anyone? (Score:3, Insightful)
Then it squeezes more concessions out of Intel to be the flag bearer. They get something - more marketing $$$, better volume margines, etc. that're given to them, and soon the dance starts over again.
The reason Dell hasn't used AMD to date is, from the customers point of view, because Intel keeps showering them with money. At the same time, HP is making sales here because they've got quad opteron systems.
So be it. If Intel doesn't keep padding Dell's bottom line, then maybe they'll have a 6850 fitted out with opterons next year.
-Peter
Re:what (Score:5, Insightful)
If you work at a place like that, it's a tough sell (if not a bureaucratic nightmare) to get hardware from a "non-preferred" vendor.
Re:Not to flame (Score:3, Insightful)
Re:Dell is afraid... (Score:2, Insightful)
Hmmmmmm.....
Re:Makes perfect business sense (Score:3, Insightful)
Dell's not going with AMD because... (Score:3, Insightful)
Oh and all this from an AMD fanboy.
Re:Makes perfect business sense (Score:2, Insightful)
I can answer that. (Score:5, Insightful)
Keeping that in consideration, why spend the extra dollrs supporting another chip that doesn't have brand awareness amoung Dell's customers?
People don't want faster computers anynmore, they want computers that work and that they don't have to worry about. The want their computers to be the next generation TV. Some may scoff, but the technical challenge of making a computer that worry free is far more challenging then another 10% speed increase that can only be measured running certian programs in lab like conditions.
Also... (Score:5, Insightful)
Would there be enough new revenue from selling AMD systems to justify that? It has to be NEW revenue, because if it's just replacing one revenue stream with another at a greater cost, why would you bother?
Dell probably does not see enough additional revenue from AMD sales to justify the increased support costs.
Re:Maybe, but not for that reason (Score:5, Insightful)
That is (one reason why) Dell isn't going AMD.
For those who hadn't noticed (all geeks, apparently) Dell is not a computer company. It is a manufacturing company. It has made great, innovative strides in extremely efficient manufacturing. They just happen to be doing it with computers. The choice of CPU in the box means as much to Dell as the choice of compressor in a Siemens fridge means to Siemens. And the CPU means as much to most consumers as the compressor in their fridge.
Sure, some compressors are probably more efficient, reliable, quiet, whatever. But if you have n million invested in robots that can install one brand of compressor and not another, are you going to switch? What if you have a huge set of automated hardware tests all of them based on Intel motherboards - are you going to switch? What if you have hundreds of call center scripts based around diagnosing known Intel related problems?
The actual capability of the processor is NOT RELEVANT. Dell don't sell PCs because they make the best ones. They sell them because they make them very cheap, and can deliver huge orders on time, even when those orders are semi-custom. Dell does not achieve this impressive feat by switching components every time one of them becomes slightly better than another. If you want that kind of thing, there are many PC makers who will do it.
Re:Better performance depends on your metric (Score:5, Insightful)
Opterons are rock solid.
Both are GREAT chips.
Via makes some GREAT motherboard chipsets.
Via makes some mediocre motherboard chipsets.
SiS makes some pretty good motherboard chipsets.
SiS makes some crap motherboard chipsets.
Not-well-known manufactures take some of the crappier parts, and put them on even crappier boards. Then you get instability.
With an Intel Chip, and an Intel Board, you know everything is going to work.
With an AMD Chip, you have to select a motherboard. You've got to do a little bit of research to make sure you aren't buying crap.
Don't get me wrong, I'm a huge AMD fan. I've got ~7 systems in my home, and several at work, and they are ALL AMD systems. But I've been burned in the past by poor quality motherboards, so I know that they do exist.
Re:Makes perfect business sense (Score:2, Insightful)
Let's be completely honest. All Dell announcements regarding AMD have nothing to do with AMD at all. It's all about Intel.
I have a bigger problem with... (Score:5, Insightful)
Re:Makes perfect business sense (Score:3, Insightful)
However, if they refuse to sell any AMD then customers who want AMD are forced to buy from someone else. It has not affected thier bottom line much yet but I know of several companies who are thinking of switching away from DELL simply because they want to buy opteron servers.
Call Dell and Demand AMD (Score:2, Insightful)
Re:There are many other reasons to switch from del (Score:3, Insightful)
There's about 100 comments on this page about Dell's amazing manufacturing ability, but it's all ignorant misinformation. Dell relies on Flextronics, Selectron, et al to build practically everything they sell. Dell "integrates" the machine by installing the hard drive and taping up the box. Dell does have a very competent supply chain management operation, but they are mainly managing the supply chain of their subcontractor. Dell has, over the years, turned themselves into a really advanced cross between Gateway and UPS. Don't be fooled into believing they have some huge from-scratch design and manufacturing facility.
Re:what (Score:3, Insightful)
Server Chip to Desktop Easier (Score:3, Insightful)
Usually the only thing preventing a server class cpu from being used on the desktop is price.
Alternatively, it is shown that fast desktop chips don't automatically make good server chips due to the different type of workload involved. If desktop chips made equally good server chips, then server chips wouldn't exist at all.
Conclusion: you'll see AMD dual-processor cpus on the desktop before you see Intel dual-processor cpus in servers.