AMD Acquires SeaMicro — Big Bet On Architectural Shift For Servers

[For some reason this has been unpublished since April — so here it is well after AMD announced its next spin of the SeaMicro product.]

At its recent financial analyst day, AMD indicated that it intended to differentiate itself by creating products that were advantaged in niche markets, with specific mention, among other segments, of servers, and to generally shake up the trench warfare that has had it on the losing side of its lifelong battle with Intel (my interpretation, not AMD management’s words). Today, at least for the server side of the business, it made a move that can potentially offer it visibility and differentiation by acquiring innovative server startup SeaMicro.

SeaMicro has attracted our attention since its appearance (blog post 1, blog post 2) with its innovative architecture that dramatically reduces power and improves density by sharing components like I/O adapters, disks, and even BIOS over a proprietary fabric. The irony here is that SeaMicro came to market with a tight alignment with Intel, who at one point even introduced a special dual-core packaging of its Atom CPU to allow SeaMicro to improve its density and power efficiency. Most recently SeaMicro and Intel announced a new model that featured Xeon CPUs to address the more mainstream segments that were not a part of SeaMicro’s original Atom-based offering.

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SUSEcon2012 — SUSE’s Coming Out Party

Every culture has its coming of age rituals — Confirmation, Bar Mitzvah, being hunted by tribal elders, surviving in the wilderness, driving at high speed while texting — all of which mark the progress from childhood to adulthood. In the high-tech world, one of the rituals marking the maturation of a company is the user group. When a company has a strategy it wants to communicate, a critical mass of customers, and prospects bright enough that it wants to highlight them rather than obscure them, it is time for a user group meeting.

This year, having passed a year since the acquisition of Novell by AttachMate and its subsequent instantiation as a standalone division, as well as being its 20th anniversary, SUSE had its first user group meeting. All in all, the portents were good, and SUSE got its core messages across to an audience of about 500 of its users as well as a cadre of the more sophisticated (IMHO) industry analysts.

Among My Key Takeaways:

  • SUSE is a stable company with rational management — With profitable revenues of over $200M and a publicly stated plan to hit $234 for the next fiscal year, SUSE is a reasonably sized company (technically a division of $1.3B Attachmate, but it looks and acts like an independent company), with growth rates that look to be a couple of points higher than its segment.
  • SUSE’s management has done an excellent job of focusing the company — SUSE, acknowledging its size disadvantage over competitor Red Hat, has chosen to focus heavily on enterprise Linux, publicly disavowing desktop and mobile device directions. SUSE’s claim is that their market share in the core enterprise segment is larger than their overall market share compared to Red Hat. This is a hard number to even begin to tweeze out, but it feels like a reasonable claim.
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