Dell Servers: What's the Deal With AMD?

The VAR Guy has been eating crow on this little item most of the day. On May 19, two channel partners told The VAR Guy that Dell planned to stop offering AMD processors on its servers. Then, The VAR Guy saw an alleged email from a Dell channel representative to the resellers, apparently confirming the news. Only, both Dell and AMD on May 20 said The VAR Guy was wrong. (Dead wrong.) Yes indeed, Dell is moving forward with AMD on servers.

Here’s where The VAR Guy’s confusion started. According to a well-connected source close to Dell:

A Dell insider also seem to confirm the news. According to an apparent email from Dell Global Channel Sales to resellers, Dell didn’t have any plans for AMD processors in the company’s next generation of servers.

But all that changed May 20 when…

AMD: The Chips Are Down

Server speculation aside, Dell’s recent pattern has been to move away from AMD-oriented desktop systems.

Dell introduced its first AMD-based servers in October 2006. At the time AMD’s Opteron processor was a super hot play in the server market. The reason: Opteron ran 32- and 64-bit applications equally well. Meanwhile, Intel was struggling to regroup from a failed all-out push to promote pure 64-bit applications on high-end Itanium processors, at the expense of 32-bit performance on Itanium.

Intel gradually recovered from some missteps, and by early 2008 Dell stopped offering AMD processors on many of its PC systems. (But contrary to The VAR Guy’s earlier claim, that mindset isn’t repeating itself on Dell servers.)

No doubt, AMD has struggled mightily in recent years. But there are signs of hope. CEO Dirk Meyer on May 18 said AMD expects its core business to make a net profit by year’s end, according to Reuters.

The VAR Guy is updated multiple times daily. Follow him via RSS, Facebook and Twitter. And subscribe to his newsletter, webcasts and Resource Center.