ARM Challenging Intel in the Server Market: An Overview
by Johan De Gelas on December 16, 2014 10:00 AM ESTMore Competition
There is no doubt that customers would benefit from Intel being challenged in the server market. There have been people arguing that the server market is healthy even with only one dominant player, since Intel is doomed to compete with previous Intel CPUs and cannot afford to slow down its update cycle. We disagree, as it is clear that the lack of competition is causing Intel to price its top Xeon EP quite a bit higher. In the midrange, there is no pressure to offer much better performance per dollar: a small increase is what we get. The recently launched Xeon E5 v3 is barely 15% faster at the same price than the Xeon E5 v2. So we would definitely like to see some healthy competition.
Are Economies of Scale and Volume Enough?
Yes, economies of scale is one of the reasons that Intel was able to overtake the RISC competition. However, simply accounting Intel's success back at the end of previous century to being the player with the highest unit sales is short sighted. Look at the table below, which describes the situation back in late 1995:
| Vendor | CPU | SPECint95 | SPECfp95 |
| Intel | Pentium Pro 200 | 8.2 | 6.8 |
| Digital | Alpha 21164 333 MHz | 9.8 | 13.4 |
| MIPS (SGI) | R8000 90 MHz | 5.5 | 12 |
| SUN | Ultra I 167 MHz | 6.6 | 9.4 |
| HP | PA7200-RISC 120MHz | 6.4 | 9.1 |
There are three things you should note. First, excluding the Alpha 21164, Intel managed to outperform every RISC competitor out there with their first server chip in integer performance. Intel managed this by excellent execution and innovative micro-architecture features (such as the 256KB SRAM + core MCM package and out-of-order micro-ops back-end). Intel also had a process technology lead and used 350nm while the rest of the competition was still stuck at 500nm.
Second, Intel was lucky that the top performer – Alpha – had the lowest marketshare, software base, and marketing power. Third, the server and workstation market was divided between the RISC Players. Software development was very fragmented among the RISC platforms.
So in a nutshell, there were several reasons why Intel succeeded at breaking into the server market besides their larger user base in the desktop world:
- Focused investments in a vertical production line and excellent execution, and as a result the best process technology in the world
- The performance and technology leader was not the strongest player in the market
- The market was fragmented, so divide and conquer was much easier
Currently, the ARM SoC challengers do not have those advantages. As far as we know, Intel's process is still the most advanced process technology on the planet. Samsung is probably close but at the moment their next generation process is not available to the Intel competitors.
Right now, Intel dominates - or more accurately owns - the server market. Every possible piece of expensive software runs on Intel, which is a very different situation from back in the RISC world of the nineties, where many pieces of important software only ran on certain RISC CPUs. Today, the server market is anything but fragmented. That makes the scale advantage of the ARM competitors a very weak argument. Intel's user base – the growing server market and declining desktop market – is large enough to sustain heavy R&D investments for a long time, contrary to the RISC vendors in the nineties which had to share a very profitable but again fragmented market.
If you're not convinced, just imagine the Alpha 21164 was the dominant RISC Server CPU, with 90-95% server market share. Just imagine that instead of having some server applications running only on SPARC or on HP PA-RISC, that every server software ran on Alpha. Now combine this with the fact that Windows on Alpha was available. It is pretty obvious that it would be have been a lot harder for Intel to break into the server and workstation market had this been the case.
So just because ARM SoCs are sold in the billions does not mean they will automatically overtake Intel server CPUs. Intel beat the RISC players because the market was fragmented, and because none of them were executing as well as Intel. For ARM alternatives to really gain traction, they need to do a lot more than simply compete in a few niche markets, as Calxeda has shown.
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beginner99 - Tuesday, December 16, 2014 - link
Agree. I just don't see it. What wasn't mentioned or I might have missed is Intels turbo technology. Does ARM have anything similar? Single-threaded performance matters. If a websites takes double the time to be built by the server the user can notice this. And given complexity of modern web sites this is IMHO a real issue. Latency or "service time" is greatly affected by single-threaded performance. That's why visualization is great. Put tons of low-usage stuff on the same physical server and yet each request profits from the single-threaded performance.Now these ARM guys are targeting this high single-threaded performance but why would any company change? Whole software stack would have to change as well at don't forget the software usually cost way, way more than the hardware it runs on. So if you save 10% on the SOC you maybe save less than 1% on the total BOM including software. They can't win on price and on performance/watt Intel still hast best process. So no i don' see it except for niche markets like these Mips SOCs from cavium.
Ratman6161 - Wednesday, December 17, 2014 - link
"Xeon performance at ridiculous prices" I just don't get the "ridiculous prices" comment. To me, it seems like hardware these days is so cheap they are practically giving it away. I remember in the days of NT 4.0 Servers we paid $40K each for dual socket Dell systems with 16 GB Ram.A few years later we were doing Windows 2000 Server on Dell 2850's that were less than half the price.
Then in 2007 we went the VMWare route on Dell 2950's where the price actually went up to $23K but we were getting dual sockets/8 cores and 32GB of RAM so they made the $40K servers we bought years before look like toys.
Four years later we got R-710's that were dual socket/12 cores and 64GB or RAM and made the $23K 2950's look like clunkers but the price was once again almost half at about $12K.
Today we are looking at replacing the R-710's with the latest generation which will be even more cores and more RAM for about the same price.
So to me, the prices don't seem ridiculous at all. The servers themselves now make up only a fraction of our hardware costs with the expensive items being SAN storage. But that too is a lot cheaper. We are looking at going from our two SANS with 4GB fiber channel connections to a single SAN with 10GB Ethernet and more storage than the two old units combined...but still costing less than the old SANs did for just one. So prices there are expensive but less than half of what we paid in 2007 for more storage.
The real costs in the environment are in Software licensing and not I'm not talking about Microsoft or even VMware. Licensing those products are chump change compared to the Enterprise Software crooks...that's where the real costs are. The infrastructure of servers, storage and "plumbing" sorts of software like Windows Server and VMWare are cheap in comparison.
mrdude - Tuesday, December 16, 2014 - link
Great article, JohanI think the last page really describes why so many people, myself included, feel that ARM servers/vendors have a very good chance of entrenching themselves in the market. Server workloads are more complex and varied today than they ever have been in the past and it isn't high volume either: the Facebook example is a good one. These companies buy hardware by the truckload and can benefit immensely from customization that Intel may not have on offer.
To add to that, what wasn't mentioned is that ARM, due to its 'license everything' business model, provides these same companies the opportunity to buy ready-made bits of uArch and, with a significantly smaller investment, build them own as-close-to-ideal SoC/CPU/co-processor that they need.
Competition is a great thing for everyone.
JohanAnandtech - Tuesday, December 16, 2014 - link
True. Although it seems that only AMD really went for the "license almost everything" model of ARM.mrdude - Tuesday, December 16, 2014 - link
Yep. And that's likely due to the budget/timing constraints. I think they were gunning for the 'first to market' branding but they couldn't meet their own timelines. Something of a trend with that company. I'm curious as to why we haven't heard a peep from AMD or partners regarding performance or perf-per-watt. Iirc, we were supposed to see Seattle boards in Q3 of 2014.I also feel like ARM isn't going to stop at the interconnect. There's still quite a bit of opportunity for them to expand in this market.
cjs150 - Tuesday, December 16, 2014 - link
Ultimately, my interest in servers is limited but I would like a simple home server that would tie all my computers, NAS, tablets and the other bits and bobs that a geek household has.witeken - Tuesday, December 16, 2014 - link
Who's interested in Intel's data center strategy, can watch Diane Bryant's recent presentation (including PDF): http://intelstudios.edgesuite.net/im/2014/live_im.... The Q&A from 2013 also has some comments about ARM servers: http://intelstudios.edgesuite.net/im/2013/live_im....Kevin G - Tuesday, December 16, 2014 - link
"Now combine this with the fact that Windows on Alpha was available." - Except that Windows NT was available for Alpha. There was a beta for Windows 2000 in both 32 bit and 64 bit flavors for the curious.I disagree with the reason why Intel beat the RISC players. Two of the big players were defeated by corporate politics: Alpha and PA-RISC were under the control of HP who was planning to migrate to Itanium. That leaves POWER, SPARC, MIPs and Intel's own Itanium architecture at the turn of the millennium. Of those, POWER and SPARC are still around as they continue to execute. So the only two victims that can be claimed by better execution is MIPs and Intel's own Itanium.
While IBM and Oracle are still executing on hardware, the Unix market as a whole has decreased in size as a whole. The software side isn't as strong as it'd use to be. Linux has risen and proven itself to be a strong competitor to the traditional Unix distribution. Open source software has emerged to fill many of the roles Unix platforms were used to. Further more, many of these applications like Hadoop and Casandra are designed to be clustered and tolerate node failures. No need to spend extra money on big iron hardware if the software doesn't need that level of RAS for uptime. The general lower cost of Linux and open source software (though they're not free due to the need for support) combined with furhter tightening of budgets during the great recession has made many businesses reconsider their Unix platforms.
JohanAnandtech - Tuesday, December 16, 2014 - link
My main argument was that the RISC market was fragmented, and not comparable to what the x86 market is now (Intel dominating with a very large software base).While I agree with many of your points, you can not say that SPARC is not a victim. In 90ies, Sun had a very broad product range from entry-level workstation to high-end server. The same is true for the Power CPUs.
Kevin G - Wednesday, December 17, 2014 - link
The RISC market was fragmented on both hardware and software. The greatest example of this would be HP that had HPUX, Tru64, OpenVMS, and Nonstop as operating system and tried to get them all migrated to a common hardware platform: Itanium. How each platform handled backwards compatibility with their RISC roots was different (and Tru64 was killed in favor of HPUX).The midrange RISC workstation suffered the same fate as the dual socket x86 workstation market: good enough hardware and software existed for less. The race to 1Ghz between Intel and AMD cut out the performance advantage RISC platforms carried. Not to say that the RISC a chips didn't improve performance but vendors never took steps to improve their price. Window 2000 and the rise of Linux early in the 2000's gave x86 a software price advantage too while having good enough reliability.
Sun's hardware business did suffer some horrible delays which helped lead the company into Oracle's acquisition. Notably was the Rock chip which featured out-of-order execution but also out-of-order instruction retirement. Sun was never able to validate any prototype silicon and ship it to customers.