With six-core chips and a road map, AMD preps for stimulus money fight

But Intel is already on the ground in Washington selling its chips

WASHINGTON -- The U.S. government is beginning to spend billions of dollars quickly to stimulate the economy. And that may be why Advanced Micro Devices Inc. said this week that it is releasing its six-core Opteron chip in June, well ahead of schedule, and plans to follow it early next year with a chip code-named Magny-Cours that will ship in eight- and 12-core models. After that, it plans a 16-core chip in 2011 .

But while AMD was in Sunnyvale, Calif., announcing its aggressive chip road map, Justin Rattner, Intel Corp.'s chief technology officer, was in Washington, selling his company's chips.

"I think we see a number of opportunities, and what we are trying to do is raise awareness that this is an extremely auspicious moment," said Rattner. He was talking primarily about the performance gains of the latest Intel Xeons, but the company is also cognizant of the government's plan to spend a lot of money on technology.

To be sure, AMD can't afford be left behind in U.S.-funded tech upgrades, not with its recent string of losses. And the government has been good for the company. When AMD released its 64-bit Opteron in 2004, its first big users were high-performance computing centers that get much of their money, directly or indirectly, from government sources. The fastest supercomputer in the world -- IBM's peta-scale Roadrunner, built for the Los Alamos National Laboratory -- uses Opteron chips.

Rattner doesn't know how many federal dollars will go to technology and said Intel is still discovering opportunities in the government's spending plans. "I think we were surprised that there is money in the stimulus for high-performance computing as it relates to climate change," he said.

The government is now putting in place the processes through which it will spend the nearly $800 billion stimulus money on a variety of projects. Government agencies will get a lot of new servers; technology is being rolled out for health care; supercomputers will be built. And new industries will rise. The government, for instance, plans to spend $2 billion for lithium-ion manufacturing plants.

Rattner met with government officials and IT managers at an Intel-sponsored conference here, and discussed the merits of the company's processor technology -- in particular its Nehalem, or Xeon 5500, the quad-core workhorse used in many mainstream servers. Intel released a six-core chip, the Xeon 7400, last September. The eight-core Nehalem EX is expected in 2010.

AMD is "trying to get ahead of Intel," especially its Nehalem EX, said Nathan Brookwood, an analyst at Insight64 in Saratoga, Calif. That's in part behind AMD's decision to push out its six-core Istanbul chip five months ahead of schedule.

Nehalem "clearly has seized the performance advantage that AMD had for a very long time," Brookwood said. Now, AMD believes Istanbul "will keep them very competitive over the next year, and then going to 12 cores in 2010 will keep them competitive when Intel comes out with eight."

Charles King, an analyst at Pund-IT Inc., said that large, multicore chips are focused "on delivering increasingly robust platforms for virtualization. I think that's where they see the future in the x86 market," he said.

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