Article Online: Microservers must Specialize to Survive

Article: Microservers must Specialize to Survive
By: David Kanter (dkanter.delete@this.realworldtech.com), January 29, 2013 12:52 pm
Room: Moderated Discussions
> > I think the argument about area and cost - and Intel's processing advantage -
> > is all correct. What may be missing is the impact of the different business
> > strategies: Intel really wants to sell those server cpus at very high margins -
> > say 300mm2 of silicon for $1500. But it's going to be facing a lot of competitors
> > from the ARM/cellphone world, e.g. Qualcomm, who would be very happy to sell
> > 10M server cpu's at dramatically lower margins. Intel's technical advantages
> > alone won't allow them to preserve their high margins on server products (just
> > as the advantages of RISC servers couldn't protect them against Intel's high-volume
> > good-enough-and-much-cheaper P6). The future may still be predominantly x86 -
> > but the business will look very different.
>
>
> I agree 100%. People think that Intel can't be beat on cost because their CPUs aren't that expensive,
> but that's anchor pricing. It seems cheap because there isn't anything cheaper.

There is. But AMD simply cannot sell because the perf and power is unacceptable relative to Intel's "cheap".

>I'm sure 20 years
> ago when RISC servers with $10K CPUs were selling and Intel didn't have any CPUs designed expressly
> for servers, Microsoft was still only talking about NT, and Linux was just a hobby project, those $10K
> CPUs seemed cheap.

Sequent was doing x86 servers since 1987.

The real issue is that Intel was able to sell cheaper CPUs because of their high volume, manufacturing and design re-use.

Most phone vendors have no manufacturing, and little IP that you'd re-use with a server. They also aren't likely to be much cheaper than a $200 Intel chip. I think the real issue is that they may come in with a more tightly integrated platform that lowers total cost. But there isn't a huge amount of room to move down...

Also, for servers, the CPU may not even be the dominant cost...as opposed to DRAM.

> ARM can't take the x86 market, because it won't compete on RAS at the high end. Just like x86 didn't
> take the RISC market because it couldn't compete with RISC RAS on the high end. Just like RISC didn't
> take the mainframe market because it couldn't compete with IBM mainframe RAS on the high end. ARM
> doesn't need to provide a replacement for x86 server CPUs, just something that is "good enough" and
> significantly cheaper.

There isn't a lot of room to be significantly cheaper though. Intel's server products span from around $150ish to $4K. That low-end is pretty darn cheap.

x86 servers were great because they hugely expanded the market. I don't see a $100 chip expanding the market relative to a $150 one.

>It won't sell because ARM is better than x86 - x86 was certainly worse than
> RISC but it won. It won because it was cheaper. If Intel sacrifices enough profit it can keep ARM
> at bay, but if it doesn't sacrifice profit, that profit will be taken from them.

I suspect Intel's profits will decrease a bit, but not hugely.

> It would be quite reasonable to sell ARM (or Intel) server CPUs for $100, if you don't care about using them
> in high RAS situations and compete on throughput jobs like web serving, batch processing, and the client side
> of client/server software like SAP where high single thread performance is not important. That $100 could
> still leave a very nice margin, but would cost so much less it would be attractive to a >lot of people.

Right, but Intel is selling a pretty nice server processor close to that price point already: http://ark.intel.com/products/52271/Intel-Xeon-Processor-E3-1230-8M-Cache-3_20-GHz

You buy in volume, I'd bet you pay around $150. And compare that to a quad-core A9, the performance gap is huge. Probably around 3-4X in compute and bandwidth.

> It makes the most sense for cloud computing, which is why Facebook is already going ARM. I wouldn't be surprised
> if Google already has some infrastructure running on it too, but they don't talk about that very much. Perhaps
> Apple's $1 billion datacenter in NC will have a lot of ARM...we'll probably never know.

Facebook is trying to get other companies to do their engineering for them AFAICT. The larger companies like Google and MS do all this internally, and they seem to be on-board with high volume Intel server chips. Also, there aren't many customers who are willing to deal with unusual architectures.

> Obviously Intel can compete with $100 low-RAS server CPUs, and still be profitable. Probably come
> close to their current overall margin. But that will still lower their overall margin, since server
> CPUs have the biggest profit margin of anything for Intel. And more importantly, lower their overall
> dollar profit. Even if they were able to sell $100 CPUs with a 70% margin instead of $1000 CPUs with
> a 70% margin, they still lose out big time unless they sell 10x more of the $100 CPUs.

It's certainly possible that Intel will take a hit to revenue and margins, it's hard to say. But as you've said already, Intel (and AMD's x86s) can compete if they want to...

Which is one reason why I don't understand AMD. I'd think an 8-16 core Jaguar variant would be fine for microservers. ARM cores aren't going to buy you a huge advantage, and x86 compatibility is a big sell.

David
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                "Just recompile"Michael S2013/02/05 09:35 AM
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                                                    ARMv8 cleanlinessDavid Hess2013/03/01 12:58 PM
                                                      What is wrong with ARM?Paul A. Clayton2013/03/01 05:56 PM
                                                        What is wrong with ARM?David Hess2013/03/01 06:49 PM
                                                          What is wrong with ARM?Michael S2013/03/02 04:11 PM
                                                            What is wrong with ARM?David Hess2013/03/03 10:32 PM
                                                              What is wrong with ARM?Michael S2013/03/04 01:05 AM
                                                        What is wrong with ARM?David Hess2013/03/07 05:30 PM
                                                          Thank you very much!Paul A. Clayton2013/03/07 06:59 PM
                                                            Thank you very much!David Hess2013/03/07 10:22 PM
                                                              Thank you very much!gallier22013/03/08 12:43 AM
                                                                Thank you very much!David Hess2013/03/08 10:24 AM
                                                                  Thank you very much!Ungo2013/03/08 03:37 PM
                                                                    Thank you very much!David Hess2013/03/08 07:47 PM
                                                            Thank you very much!Ricardo B2013/03/08 04:07 AM
                                                              ARM lackings a historical accident?Paul A. Clayton2013/03/08 07:54 AM
                                                                ARM lackings a historical accident?Ricardo B2013/03/08 02:33 PM
                                                          What is wrong with ARM?Michael S2013/03/08 05:25 AM
                                                            What is wrong with ARM?David Hess2013/03/08 11:37 AM
                                                            What is wrong with ARM?dmsc2013/03/12 02:47 PM
                                                          What is wrong with ARM?dmsc2013/03/12 02:43 PM
                                                      ARMv8 cleanlinessMichael S2013/03/02 04:06 PM
                                                    ParityAndi Kleen2013/03/03 12:47 PM
                                                      ParityLinus Torvalds2013/03/03 02:06 PM
                                                        ParityAndi Kleen2013/03/03 06:15 PM
                                            Except the borrow bitMatthew D2013/02/25 11:07 PM
                                              Except the borrow bitrwessel2013/02/25 11:42 PM
                                              Except the borrow bitLinus Torvalds2013/02/26 10:13 AM
                                                are ZSCO flags really fundamental?Michael S2013/02/27 03:24 PM
                                                  are ZSCO flags really fundamental?Linus Torvalds2013/02/27 04:41 PM
                                                    are ZSCO flags really fundamental?Michael S2013/02/28 12:39 AM
                                                    are ZSCO flags really fundamental?2013/03/01 09:23 AM
                                                  are ZSCO flags really fundamental?EduardoS2013/02/27 10:07 PM
                                                    are ZSCO flags really fundamental?Michael S2013/02/28 03:58 AM
                                                  are ZSCO flags really fundamental?rwessel2013/02/27 11:29 PM
                                                    are ZSCO flags really fundamental?rwessel2013/02/27 11:32 PM
                                                    Bit numbering on big endian machinesKonrad Schwarz2013/02/28 12:49 AM
                                                      Bit numbering on big endian machinesrwessel2013/02/28 01:32 AM
                                          ARMv8 cleanlinessWilco2013/02/25 04:54 AM
                                            ARMv8 cleanlinessEduardoS2013/02/25 05:24 AM
                                              ARMv8 cleanlinessWilco2013/02/25 06:36 AM
                                                ARMv8 cleanlinessEduardoS2013/02/25 12:06 PM
                                                  ARMv8 cleanlinessWilco2013/02/25 04:24 PM
                                                    ARMv8 cleanlinessEduardoS2013/02/25 04:55 PM
                                                    Utility of data loss exceptionsPaul A. Clayton2013/02/25 07:18 PM
                                                      Utility of data loss exceptionsrwessel2013/02/26 12:00 AM
                                                        Excessively expensive mode changingPaul A. Clayton2013/02/26 05:15 AM
                                                      Utility of data loss exceptionsEduardoS2013/02/26 01:55 AM
                                                        Utility of data loss exceptionsTREZA2013/02/26 03:53 AM
                                                          Utility of data loss exceptionsEduardoS2013/02/26 04:37 AM
                                                      Utility of data loss exceptionsEtienne2013/02/26 05:01 AM
                                            1b vs. 4b not a huge difference?Paul A. Clayton2013/02/25 08:57 AM
                                  Possible benefit of multi-bit CCPaul A. Clayton2013/02/23 07:09 AM
                                ARMv8 cleanlinessrwessel2013/02/17 11:01 PM
                                  ARMv8 cleanlinessWilco2013/02/18 04:33 PM
                                    ARMv8 cleanlinessEduardoS2013/02/18 07:18 PM
                                      ARMv8 cleanlinessWilco2013/02/25 05:19 AM
                      ARMv8 cleanlinessTREZA2013/02/15 03:21 AM
                      ARMv8 cleanliness2013/02/17 09:49 AM
                        ARMv8 cleanlinessLinus Torvalds2013/02/17 10:54 AM
                          ARMv8 cleanlinessLinus Torvalds2013/02/17 10:58 AM
                          ARMv8 cleanlinessnone2013/02/17 03:36 PM
                        ARMv8 cleanlinessTREZA2013/02/17 10:59 AM
                          ARMv8 cleanlinessWilco2013/02/17 11:30 AM
                            and-compare and or-comparePaul A. Clayton2013/02/17 04:28 PM
                              early branch resolutionanon2013/02/18 01:05 AM
                                My ignorance about compilers is vasterPaul A. Clayton2013/02/18 12:30 PM
                                early branch resolutionanon2013/02/18 04:12 PM
                              early branch resolution?EBFE2013/02/19 12:03 AM
                                Early resolution: some but limited potentialPaul A. Clayton2013/02/19 04:52 PM
                                  Early resolution: some but limited potentialhobold2013/02/20 01:02 PM
                                    PPC750 was an inspirationPaul A. Clayton2013/02/23 07:09 AM
                          ARMv8 cleanlinessTREZA2013/02/17 12:53 PM
                            ARMv8 cleanlinessExophase2013/02/17 03:49 PM
                        ARMv8 cleanlinessWilco2013/02/17 11:07 AM
                        ARMv8 cleanlinessbakaneko2013/02/17 11:43 AM
                        ARMv8 cleanlinessJouni Osmala2013/02/17 12:10 PM
                          -1 comparison true seems betterPaul A. Clayton2013/02/17 05:07 PM
                  ARMv8 cleanlinessEtienne2013/07/17 01:58 AM
      ARM server benchmark- why Apache?Per Hesselgren2013/02/04 11:13 PM
        ARM server benchmark- why Apache?anon2013/02/04 11:38 PM
          ARM server benchmark- why Apache?Per Hesselgren2013/02/05 12:25 AM
            ARM server benchmark- why Apache?Michael S2013/02/05 01:13 AM
          ARM server benchmark- why Apache?Michael S2013/02/05 12:51 AM
          I think that was debunked alreadyDavid Kanter2013/02/05 06:36 PM
        ARM server benchmark- why Apache?bakaneko2013/02/06 01:37 AM
          ARM server benchmark- why Apache?Michael S2013/02/06 02:43 AM
            Marketing to PHBs?Paul A. Clayton2013/02/06 05:40 AM
            ARM server benchmark- why Apache?bakaneko2013/02/06 06:08 AM
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