Itanium or Itanic–The debate continues   

It is a foregone conclusion that the Itanium processor will be a commercial flop in terms of return on investment. A decade of development involving hundreds of top-notch engineers and costly launch delays have put a mega-big, make that a Giga-big price tag on this product. Intel will never recover that investment under the best of scenarios. About the worst thing that can happen to any new product is customers knowing that there is a better version right around the corner.

But that is exactly the position the three-year launch delay has put Itanium in, as the next-generation Itanium, the McKinley is only 12-18 months away from production. Itanium will not have a fair chance to enjoy a typical product life cycle. It will instead function largely as a test case, a beta, for McKinley. Many companies will buy a few systems, but most network administrators will likely wait for McKinley to place more significant orders.

Another factor hampering Itanium's success is that the release comes at a time when the market, especially for servers, is struggling to find new footing after bottom gave away, late last year. Even Intel is cutting back on the plans for its server farms, where many Itaniums' would likely have ended up, had they been available. And just because it is here and it is from Intel, does not guarantee success in the server chip business.

A decade or so ago, I attended the launch of the Intel i960 series of Risc server processors and the demos that showed i960 machines running circles around similar Sun Sparc workstations. But the i960 flopped and there is no guarantee that the Itanium would not do that either, especially if software developers prove slow in making applications available that take advantage of the 64-bit architecture in some kind of compelling way.

A final potential trouble spot is the perceptually ‘slow’ 733 to 800 MHz at which the chip is being introduced. It seems slow when compared to 1.7GHz P4. One would think that Intel would commit its top-on-the-line production techniques for server chips that need to compete with the UltraSparcs of the world. Not putting its best production capabilities to work for the expensive Itanium seems a poor business decision. Still the release date was important because now the Itanium is at last available and a new chapter in the server computer market has begun. No doubt it will fill many pages in the years ahead.