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Big Q + Intel against the (Unix) World

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IT systems are becoming so complex that firms will fail to be competitive if they try to do everything themselves, according to Compaq's head honcho.

Michael Capellas, Compaq's chief executive, made the comments at a press conference held today in New York to spin off the Alpha development part of its business to Intel, the financials details of which are not being released.

Answering questions on how the plan will affect customers and Compaq's standing in the Unix market, Capellas stressed a commitment to protect user investment and ease the path of migration to IA-64 "best in class" systems over the next two years.

Compaq's competitors Sun Microsystems, IBM, Hewlett-Packard (which co developed the IA-64 architecture) and Dell are sure to dispute this and, as befits the fight for a multi-billion dollar market, Capellas decided to get his retaliation in first.

"It's not likely that our competitors will be able to out-spend, out-perform or out-engineer the combined efforts of Compaq and Intel," said Capellas. "In the market there's commoditisation of lower-end products and price pressure. I'm not sure if there's a firm that can do everything itself."

Compaq has a announced plans to standardise on Intel's 64-bit architecture by 2004, and Capellas said that it would differentiate itself on system building block technology (clustering and process control etc.) as well as services, something he hopes to improve with Compaq's upcoming reorganisation.

Divesting itself of Alpha development would have significant cost benefits for Compaq, which he wasn't prepared to go into details about.

Intel's chief executive Craig Barrett said that because its deal with Compaq involved "non-exclusive" acquisition of Big Q's intellectual property, there would be no regulatory roadblocks.

From Intel's point of view, gaining hold of Compaq's Alpha processor development team will help it gain a pool of highly experienced personnel (instead of recruiting college kids), and helps it develop better compiler technology.

There's also the idea that Alpha is a more mature (and superior) 64-bit technology to Itanium and gaining hold of it will allow Intel to develop all sort of bells and whistle features, such as multi-threading and parallel processing for its processors. It also means the IA-64 faces one less competing microprocessor architecture in the future... ®

External Links

Compaq and Intel to Accelerate Enterprise Server Roadmaps

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