Dell 14, IBM 0 – quarterly Itanic sales revealed

Volume economics: the saga continues


Intel would have you believe that Itanic is rising, but sales figures from IDC show the chip sinking at speed. This is hardly surprising, as we have discovered, when OEMs are reluctant to ship IA-64 boxes even to customers who demand them.

But first, the figures. In the first quarter of 2003, a grand total of 1,963 Itanium-based servers left the shipping docks. This number marks a 31 percent drop in units shipped when compared to the fourth quarter of 2002. It also means that 12 vendors were forced to split up a paltry $63 million in revenue between them.

Hewlett-Packard is the clear Itanic server leader, but this may not be a good thing. The company was able to move 2,667 servers in the fourth quarter but only sold 1,835 systems in Q1. HP has bet its server future on Itanic, so it needs to pick up the pace.

More shocking than HP's totals are the figures for Dell and IBM.

Dell managed to eke out 54 system sales in the fourth quarter of 2002 but saw shipments fall to 14 units in the most recent period. That's right. 14.

IBM boasted 34 sales in Q4 but saw Itanic servers disappear all together in Q1. What do we mean by disappear? Zero servers shipped.

A number of factors contributed to Itanium's vanishing act in the quarter. First off, neither Dell nor IBM sold systems based on the Itanium 2 chip in the period, meaning the 14 systems moved by Dell must be very old kit. [Perhaps they were shipped to a computer museum? - ed.]

IBM finally came on board earlier this month and Dell plans to ship Itanium 2 servers later this year. Any sales figures, however, won't show up for some time.

Intel also has the next version of Itanium 2 - called Madison - scheduled for release in the next couple of months. Perhaps customers are waiting for this chip, which is expected to show significant performance increases over its predecessors.

IBM said that users are waiting for Madison-based servers to arrive "in the coming weeks" and that only a few customers are asking for current Itanium 2 boxes. IBM, of course, has to clock current systems down to 800MHz because of a bug with the Itanium 2 chip.

She won't return my calls

One user and Register reader tells us he has begged IBM for an Itanium 2-based server, but to no avail.

"I've called twice now to try to find how to buy an x450, and both times have just gotten a 'we can't sell that machine here, and we'll have to have the special team call you back' from the (IBM) sales rep," said the source. "They aren't even able to quote me a price, and no price is listed on the Web site."

Clearly, it will take a heck of a lot to make up for the dismal performance of the processor in Q1. Users appear reluctant to pick up Intel's 64bit chip, continuing to stick with the more mature RISC options of Sun Microsystems, IBM and HP.

HP has won some Itanium deals at IBM's expense, and this could help create a competitive environment more friendly to Intel's future. It seems, however, that IBM will continue to put more energy behind its own Power4 chip and leave HP on its own in rough waters.

Again, the user provided some clarity on this debate.

"I'm putting more than the usual effort into pursuing this since I need the high floating point performance of the Itanium 2 chip and hate HP," the source said.

So even two giants like HP and IBM cannot help a user anxious to book a ticket on the Itanic. What does this tell us? ®

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