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SGI chief outlines roadmap out of mortuary

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Dennis McKenna has been in one of the technology industry's most thankless jobs for five months. No, he's not in Itanium marketing, or even Wikipedia's press officer. The CEO has the task of nursing one of Silicon Valley's most storied names, Silicon Graphics Inc., out of bankruptcy. And as you might expect, he reckons the only way for yesterday's Google is up.

McKenna was in London outlining his plans this week, and he dwelt tantalizingly, and briefly, on some of the issues we've highlighted recently. Particularly Rick Belluzo's brief trail of destruction through the company. But more on that in a moment.

In the early 1990s, SGI was an icon of technological omnipotence. It was feted by politicians and lauded in the popular press as the technology company that had the potential to do anything, and be everywhere. It was simply cleverer and more stylish than any rival, we were told, and had the profits to prove it. SGI filed for bankruptcy protection last month, and its Mountain View offices are now occupied by its successor in the media iconography, Google.

So where did SGI go wrong, then, Dennis?

"SGI made three acquisitions - spent a lot of time integrating them, and they all were sold... They bought high and sold low."

SGI also abandoned its MIPS architecture for Itanic - although McKenna was careful not to give the impression that he thought IA-64 was a dead end. SGI sold just 230 IA-64 systems in the last quarter, down from 244 a year earlier.

SGI was bullish about Intel roadmaps now, and thought its loyalty would finally begin to pay dividends.

"Opteron has won the last twelve months' fashion show. But people don't make buying decisions based on the past. We think Intel's Woodcrest..." - and brace yourselves, here, dear readers - "... will take Opteron to the woodshed."

(We wish we hadn't heard that either)

"We will see what will happen in two years," he added, sounding a fairly pragmatic note of caution.

It's clear, however, that McKenna sees much more growth in commodity Intel chips than in the boutique 64-bit behemoth. SGI's future is in bundled clusters, tuned for vertical markets.

Which verticals? Archiving and storage, he said. Storage was SGI's best kept secret he claimed, something that's been true for a long time. Selling the kit has always been the problem.

We wondered why with the post 9/11 "pork boom" - government defense contracts focusing on data mining - as well as an added urgency to the business of energy resources exploration, SGI hadn't capitalized on what should have been a promising time in its traditional markets?

SGI had been outdone by cheaper solutions, McKenna said, bluntly. But some customers had tried commodity Linux clusters and just didn't get the performance. Collaborative tools also offered SGI some potential growth.

Now to the interesting bit.

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