Sun Microsystems poised to use Intel chip in servers

Sun Microsystems and Intel will hold a joint press conference at 10 a.m. today to announce a ``landmark alliance,'' Sun said this morning. It's likely the news will be that Sun, the Santa Clara-based maker of computer servers, will start using Intel's new energy-efficient Xeon processors in its fast-growing line of x86 servers, something Banc of America Securities analyst Sumit Dhanda predicted in a research report published Friday. Sun's Chief Executive Jonathan Schwartz and Intel's Chief Executive Paul Otellini will speak at the press conference, which will be held at a downtown San Francisco hotel and broadcast live over the Internet at www.sun.com.

``We believe that Sun has put the wheels in motion to rekindle the relationship it once had with Intel on x86 servers,'' Dhanda wrote in his report. Dhanda pointed out that over the past two to three years, Sun has exclusively outfitted this server line with Opteron chips from Advanced Micro Devices, Intel's arch-rival, because they performed better than Intel's older chips. He added that Sun is probably just one of many other server makers considering this kind of switch. Dhanda estimated that Sun's Intel-chip servers will be produced late this year and would bring Intel $25 million to $50 million in revenue in 2008, assuming the world's largest chip maker wrestles away 25 percent to 50 percent of Sun's x86 business from rival AMD.

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News source: Sillicon Vally

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