AMD buys SeaMicro, enters server hardware business
AMD will sell SeaMicro servers directly to customers, but also license its technology to other server makers
IDG News Service - Advanced Micro Devices announced Wednesday it is buying low-power server vendor SeaMicro, a surprise move that puts AMD in the systems business and disrupts Intel by acquiring one of its close partners.
AMD will pay US$334 million in cash and stock for SeaMicro, an 80-employee Silicon Valley startup that has gained attention for building highly dense and power-efficient servers for use in large-scale cloud computing environments. SeaMicro CEO Andrew Feldman will become general manager of a new division at AMD, the Data Center Server Solutions group.
AMD plans to sell SeaMicro-branded servers directly to customers, but it bought the company primarily for its technology, which it hopes to license to other server vendors to build their own low-power systems, AMD officials said.
"SeaMicro has a proven technology that has been benchmarked in key customer sites to show improvements in power consumption and total cost of ownership. That [intellectual property] was very attractive to us," said Lisa Su, senior vice president and general manager for AMD's products division.
The move will be seen as a setback to Intel, which had formed a tight partnership with SeaMicro. All the servers SeaMicro currently sells are based on low-power Intel Atom processors, and just a few weeks ago the companies held a joint press conference where Intel sang SeaMicro's praises.
AMD will continue to sell SeaMicro servers based on Intel processors "for the foreseeable future," Lu said. By the end of this year, she said, it will release the first SeaMicro servers based on AMD Opteron processors.
Feldman wouldn't say when SeaMicro and AMD began talks but said the deal came about "unbelievably quickly." He said there were other suitors for the company, including non-chip vendors.
Jason Waxman, general manager of Intel's data center business unit, said Intel would be happy to keep providing its processors for SeaMicro servers. If AMD chooses not to use them, other server vendors, including Dell, are also using Intel chips in low-power, scale-out servers, he noted.
Working closely with startups always presents risks, Waxman said. "We wouldn't be doing our job if we didn't anticipate these things," he said in an interview. He suggested Intel might develop its own equivalent of SeaMicro's technology if its customers demand it.
SeaMicro developed an interconnect technology that allows it to eliminate all but three of the chips on a standard server motherboard. That allowed it to develop servers that it claims consume one quarter the power and one sixth the space of standard x86 servers.
Its products are geared primarily towards high volume, Web-based transaction workloads that don't require the computing muscle of a traditional Xeon or Opteron server processor. Mozilla uses SeaMicro servers, for instance, to deliver software updates to users.
- Path Selection Infographic Path Selection Infographic
- Hyperconvergence Infographic A wide range of observers agree that data centers are now entering an era of "hyperconvergence" that will raise network traffic levels faster...
- Preparing Your Infrastructure for the Hyperconvergence Era From cloud computing and virtualization to mobility and unified communications, an array of innovative technologies is transforming today's data centers.
- How WAN Optimization Helps Enterprises Reduce Costs If you wanted to break down innovation into a tidy equation, it might go something like this: Technology + Connectivity = Productivity. Productivity...
- Redefine Your IT Operations: Remote Office IT Has Never Been Simpler Join us to see why PC Pro named Dell PowerEdge VRTX the "2013 Server of the Year." PowerEdge VRTX may be just what...
- LIVE EVENT: 5/7, The End of Data Protection As We Know It. Introducing a Next Generation Data Protection Architecture. Traditional backup is going away, but where does this leave end-users? All Hardware White Papers | Webcasts
Our new weekly Consumerization of IT newsletter covers a wide range of trends including BYOD, smartphones, tablets, MDM, cloud, social and what it all means for IT. Subscribe now and stay up to date!