Over the past week, Intel has asked Digital to return confidential product-related information -- from engineering documents to chip prototypes -- that Intel gave under 1991 and 1996 non-disclosure agreements, said Howard High, an Intel spokesman. Digital has licensed Intel microprocessors, High said, and Intel gave Digital the product information in order to allow it to do advanced engineering work. As of yesterday, however, Digital had not returned the information, even though a contract spells out that either party can request the end to the non-disclosure agreements at any time, he said.
Yesterday's suit, filed in the U.S. District Court in San Jose, California, alleges that Digital is violating Intel's intellectual property rights by not returning the product information; Intel is seeking unspecified damages. Intel's High acknowledges, however that the suit is related to Digital's recent patent infringement lawsuit against the Intel.
"When you've got a situation where another company is accusing you of theft and making accusations on your integrity, the last thing that you want to do is take your confidential advanced intellectual property information and supply that into that company," High said.
Digital's general counsel, Thomas Siekman, called Intel's suit unjustified but not a surprise. The suit, he said in a written statement, is a "thinly veiled attempt to cause concern among Digital's customers" and an attempt to "threaten" and "silence" Digital in the wake of its own patent infringement challenge against Intel.
Digital's lawsuit alleges that Intel infringed on Digital's patents for Alpha microprocessor technology and used the technology in its Pentium, Pentium Pro, and Pentium II chip lines. Intel, whose chip market share dwarfs that of Digital's Alpha, has denied those allegations and vowed to vigorously defend against the suit.
Digital's Siekman claims the company has long-term product contracts with Intel through 1999, and that it expects to retain "timely" access to Intel's technology just the same way other Intel customers do. Intel's High, however, said Digital has a long-term contract for some products, but its microprocessor contract runs only through the third quarter of this year and the companies have yet to negotiate an extension, he said.
Digital could be hurt by not having access to Intel's chip road map, since it needs to know Intel's plans to make its own plans, said Tony Massimini, chief of technology at Semico Research Inc. in Phoenix. "They kind of lose what people sometimes refer to as 'most favored customer' status," Massimini said.
Even so, Digital has said that it plans to build systems in the future using Advanced Micro Devices Inc.'s K6 chip, a competitor to Intel's Pentium II, Massimini said.
by Sari Kalin, IDG News Service, Boston Bureau
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The company also set out a road map for future use of Intel Corp. technology and how it plans to handle support for both RISC and Intel's forthcoming Merced processor line.
The new HP 9000 V2200 Enterprise Server, designed for up to 32-way symmetric multiprocessing (SMP), is due out to first customers in September and will ship in volume by the end of the year, officials said. Other highlights of today's announcements included the launch of 200-MHz PA-RISC 64-bit microprocessors, the 64-bit HP-UX 11.00 operating system, upgrades to the K-class servers, as well as volume shipments and new benchmarks for T-class servers running SAP AG software.
Kicking off the announcements today, HP officials aimed directly at Sun, which has attacked HP for attempting to embrace both Microsoft Corp.'s Windows NT as well as Unix.
"We'd be out of our ever-lovin' minds to walk away from Unix," said Lew Platt, president, chairman, and CEO of HP. "Ever since we announced that we were also embracing NT and were committed to mixed Unix and NT environments, which helps, which works a lot better for our customers, some of our smaller competitors are using the FUD weapon -- you know, spreading fear, uncertainty, and doubt," he said.
The centerpiece of today's announcement, the HP 9000 V2200 Enterprise Server, is meant to take back the edge Sun gained when it launched its Ultra Enterprise 10000, according to analysts here. "You could say Sun leapfrogged HP with the UE 10000," said Robert Dorin, senior analyst for Aberdeen Group Inc., a market research company in Boston. "With the V2200, HP has the potential of offering the most powerful Unix server out there."
However, Dorin noted, HP today did not release benchmarks for the V2200, so its potential still needs to be proved. "HP today is launching new servers and setting out a roadmap for the future; what customers need to do is check to see whether HP meets those major milestones it's setting out today."
While the announcement of the V2200 led off the day, HP gave over much of the time to assuring the users of current models that machines now shipping have a long life span.
Users in the audience today represented a mix of those concerned with the forthcoming technology and those who want to protect current investments. "We're looking at the V2200 because we're in a very competitive industry. We're growing, and we want to find the most cost-efficient and powerful servers out there," said a manager at a national bookstore chain, who declined to be named. The chain currently uses HP K-class servers, which are being revamped with the new 200-MHz 8200 processors.
One user here was most concerned about reaching limits on current systems such as the HP 9000 T600 server, which is now shipping in volume. "For us, what's important is to see that we're not top-ending on the T600," said Alana Ward Robinson, vice president and chief information officer at Sara Lee Hosiery in Winston-Salem, NC. Sara Lee is using T600s to implement the SAP R/3 business management system on the Oracle Corp. database.
Today, HP announced what it called the highest-ever benchmark results for SAP's R/3. The T600 12-way server supported 2,900 sales and distribution benchmark users with an average dialog response time of 1.65 seconds, HP said.
But HP took hits today from competitors on its ability to deliver forthcoming products. "It's only the best-case scenario that the new V-class machines will be out the door at the end of the year," said Bob Robinson, marketing manager for Sequent Computer Systems, which offers high-end Unix-based servers. "Basically they took some technology from their acquisition of Convex [Computer Corp.] to preannounce the V-Class."
Analysts, however, put a positive spin on the Convex technology, which HP acquired in 1995. "For the first time HP's 9000 technology is using all the goodies in its Convex supercomputer division. They've got a memory architecture, called the Hyperplane, that is the fastest in a single SMP system, eclipsing Sun's cross-bar technology," said Brad Day, senior analyst at Giga Information Group, in Cambridge, MA.
The V-class pushes Unix/RISC vendors even farther into the high end, differentiating them from Intel, analysts said.
The V2200's Hyperplane backplane connection between the CPU, memory, and I/O means that all those components are equally optimized, or running at the same frequency, unlike Intel's Pentium II with its half-speed off-chip cache that slows down access to cache memory, according to Chris Le Tocq, an analyst with Dataquest. Le Tocq expected the V2200 benchmarks when published to exceed Sun's UE 10000.
But officials at Sun, reached yesterday for comment, said the cost of supporting both Intel and RISC architectures in the future would be a drain on company resources. "Hewlett-Packard has a huge support and sales organization," said David Douglas, marketing director for workgroup servers at Sun. Douglas questioned whether the margins HP will receive from selling NT will give enough of a return for the staff HP will need to support both environments.
But HP stood by its promise to support both architectures. "We have made a commitment for binary compatibility back to x86 and back to PA-RISC," said Nigel Ball, director of marketing for the Enterprise System Division. "For PA-RISC what we're saying is we'll deliver equivalent performance on uncompiled applications that will run on Merced in the future -- we'll do that through a technology called object code translation." Any PA-RISC code that runs today will run unchanged on the Merced based systems, and customers will then have the choice of selectively recompiling for performance on a specific platform, Ball said.
Details of today's announcements included:
--Marc Ferranti, IDG News Service, New York Bureau
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At the event, billed as Scalability Day, executives positioned the company's high-end Windows NT technology as the latest extension to its Windows Everywhere campaign, offering symmetrical architecture from hand-held devices up to clustered server systems as a major advantage of buying Windows.
Speaking to Microsoft executives, ISVs, and hardware partners, Gates plugged NT's applicability in the enterprise and outlined coming features, such as clustering support and 64-bit extensions, to back up his claims.
Executives demonstrated Windows NT and Microsoft's next release of its SQL Server database powering the Microsoft Terra-Server, which stores a 1-terabyte database on a single NT node. This system, based on Digital's AlphaServer 4100 with four processors and 2 gigabytes of memory, is the largest NT node to date, Gates said. This future version of SQL Server, code named Sphinx, will begin beta testing next month.
The company also demonstrated an NT-powered system that can perform more than 1 billion transactions a day.
Attendees at the event seemed generally impressed with Microsoft's demonstration of enterprise-quality technology. "Microsoft is taking significant steps; I'm fairly impressed with where they are at," said Andrew Brosseau, managing director of institutional research with Cowen Inc. in Boston. "Their ability to deliver [scalable technology] is in part contingent on their partners, but over time clustering and SMP support will be their own."
However, NT still cannot handle the largest, distributed computing systems, analysts noted. "You have to put yourself in the shoes of an IT manager. If you're running a $10 million mainframe system and have a choice of going to a $5 million Unix system with a lot of security or a $3.5 million NT system without that security, you're probably going to go with Unix," said Mike Kwatinetz, managing director of investment bank Deutsche Morgan Grenfell Inc.'s Technology Group in New York.
NT's forthcoming clustering capability will provide the ability to handle the concurrent users and offer more security in terms of failover, that very large enterprises need, according to other analysts. "Realistically you're only going to get 15 to 20 concurrent users on one processor using NT, so it's still for small departments," said David Cappuccio, vice president at Gartner Group in Stamford, CT, speaking before the event today. "Running NT as a server for small departments makes a lot of sense today, but I think you can say that they're a few years behind Unix in terms of ability to handle concurrent users."
SAP AG, one of Microsoft business partners, is looking forward to clustering technology in order to be able to offer its business management program, R/3, on NT to its largest customers. Right now, NT's SMP (symmetric multiprocessing) capabilities let R/3 run on NT for systems handling up to 2,400 users. Above that, or for systems handling 500 concurrent users, SAP suggests Unix, according to Gunther Tolkmit, vice president of corporate marketing for SAP.
About 28 percent of all R/3 applications are running in NT now, but the run rate for sales of R/3 on NT is 42 percent, Tolkmit said.
But forthcoming support for three gigabytes of memory in NT 5.0, coupled with ability to cluster over multiple servers, will help SAP appeal to a new kind of customer, Tolkmit said. "With the Internet we are seeing the need to combine in a synergistic way a hybrid system," said Tolkmit. "Local orders are being processed locally, but there is a new need to use a centralized database" to meet the expectations of customers in a global e-commerce environment.
The flexibility of Windows, running from PCs up to clustered systems, is its greatest strength, said Microsoft officials. What most distinguishes Microsoft's enterprise strategy from others is the fact that it is based on the highly successful PC model, Gates said."PC performance is improving at an incredible rate," Gates said. "The work done by Digital and Intel have given us engines to take a strong role on the desktop and move and be the highest volume servers out there. What it means for customers are high volume standard servers that give them lots of choices, and as they add servers they can mix and match."
Microsoft Group Vice President Paul Maritz added that these high-end extensions to the Windows family are intended to stretch the reach of the technology base while maintaining consistency and compatibility.
"The challenge is not just to scale, [but to also] provide a common infrastructure between small, medium, and large businesses. The Internet will have commerce and information flowing across organizational lines; we would like to make it easier to do that, not harder," Maritz said. "We have a rigid philosophy of maintaining real symmetry between what's running on server and client. Users aren't always connected to the network, so they want to have infrastructure on client as well."
To that end, Maritz announced that Microsoft will package separate versions of Windows NT Server, SQL Server, and the BackOffice suite to target different needs.
Windows NT Server will continue to be marketed as a departmental server. Microsoft, in the third quarter, plans to release Windows NT Server 4.0 Enterprise Edition. This version will support clustering, run on eight-way symmetric multiprocessing servers, offer 50 percent more memory to each application, and include the Microsoft Transaction Server and Microsoft Message Queue, officials said. Pricing has not been released.
Microsoft also sought to demonstrate Windows NT's viability as both an Internet mail and Web server. A Digital AlphaServer 4100 running Microsoft Exchange was shown delivering mail to 50,000 Internet mail boxes and Microsoft Internet Information Server (IIS), running on a Pentium-Pro-based Hewlett-Packard NetServer LX, was shown simulating 100 million Web site hits a day.
The company is also expected to release a small-business version of Windows NT, code-named SAM.
Also due in the third quarter is the enterprise edition of SQL Server, which will take advantage of additional memory space and implement clustering, Maritz said.
In the first quarter of 1998, Microsoft will add scalability features to the components in BackOffice with the enterprise edition of this product. It will include the new version of SQL Server plus an upgrade to its Exchange messaging software that will be able to store larger message databases. It will also feature a new version of Site Server that incorporates Microsoft's Commerce server, Maritz said.
In the meantime, Microsoft next quarter will release a small-business version of BackOffice that will be simplified so that a small organization could install one CD on one server and have the software configure itself.
On top of the product push, Microsoft is bolstering its support and consulting to cater to large organizations with high-end processing needs, a key ability to combat Unix, analysts pointed out.
Microsoft Consulting Service, set for third-quarter availability, will include programs for enhanced customer support as well as application design and development consulting.
In addition, a new service called Premier Support for Developers also will be rolled out in the third quarter. This plan will offer 24-hour-a-day, seven-day-a-week support for developers, include technology blueprints to help them migrate, for example, Notes users to Microsoft Exchange on NT. In addition, it will also take developer feedback in order to slip quick coding fixes into development tools, according to Deborah Willingham, vice president of the enterprise customer unit at Microsoft.
Sun's comments on Scalability Day can be found at http://www.sun.com/realitycheck/ntnotready.html.
-- Marc Ferranti, Cara Cunningham, and Martin LaMonica IDG News Service, New York Bureau
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Cyrix's lawsuit, filed yesterday in the U.S. District Court for the Eastern District of Texas, concerns two patents that Cyrix received yesterday, according to a Cyrix statement. Digital's lawsuit, filed in Massachusetts on Monday, alleges Intel infringed on 10 patents related to technology in Digital's Alpha microprocessor.
Cyrix alleges that Intel's Pentium, Pentium Pro, and Pentium II chips infringe on one or both of those patents, officials said. It is looking to get a temporary and permanent injunction to stop Intel's alleged use of their technology, as well as damages and fees.
-- Sari Kalin, IDG News Service, Boston Bureau
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"For all [Digital chairman Robert] Palmer's talk about, 'We want Intel to stop using our technology,' it's very unlikely there's going to be a shutdown of the Pentium Pro assembly lines," said Terry Shannon, publisher of Shannon Knows DEC, a newsletter out of Ashland, Massachusetts.
Digital's lawsuit, filed yesterday in federal court in Massachusetts, alleges Intel's Pentium, Pentium Pro, and Pentium II chips infringed on patented technology used in Digital's 64-bit Alpha microprocessors. The suit seeks to have Intel stop using the technology in current and future products. It also seeks triple compensatory damages, a potentially huge sum of money given the US$21 billion chip giant's growth since the Pentium line was introduced, observers said.
Intel, which is readying its own 64-bit processor, code-named Merced, plans to "vigorously defend" itself against Digital's lawsuit. An official there called the lawsuit "unusual" even in an industry where patent infringement claims are fairly common. In one of the most notable cases, Intel was involved in a seven-year dispute with Advanced Micro Devices Inc., one that it settled out of court in 1995. "Intel has sued a number of companies, [and] Intel has been named as a defendant in a number of suits," said Chuck Mulloy, an Intel spokesman. "What is unusual is two very high profile companies [being involved] without any prior warning whatsoever."
Digital has a long-term license to Intel's X-86 technology. Digital plans to continue its license, officials there said, while Intel officials said they will continue to honor it.
Digital Chairman Robert Palmer today traced the company's claim to meetings between Digital and Intel executives and engineers in 1990 and 1991, when Intel was considering licensing Digital's Alpha technology. Under a confidentiality agreement, Digital shared its Alpha technology, but Intel declined to license it in November 1991, Palmer said. Digital released the Alpha in 1992. Digital did not have any suspicions of patent infringement in 1993, when Intel released the Pentium chip, Palmer said. But in 1995, when Intel's Pentium Pro showed such a dramatic improvement in performance compared to the Pentium and began to rival performance of some RISC chips, Digital became suspicious. Palmer also pointed to an August 1996 Wall Street Journal article, which he said quoted Intel officials saying that the company had, in the past, done little original research.
Digital alleges that its cache management, branch prediction, and high-speed instruction processing technologies helped Intel develop higher-performance chips than it could have developed using its own technology. But Advanced Micro Device Inc.'s K6 chip provides performance that is very close to the Pentium Pro, and DEC does not appear to have had product licensing discussions with them, said Nathan Brookwood, a microprocessor analyst with Dataquest, a GartnerGroup company in San Jose, California. Cyrix Corp.'s M1 and M2 chips also have very high performance. "It is certainly possible to build high performance [chips] that incorporate elements of everything DEC mentioned ... and probably not violate DEC's patent," Brookwood said. "It will be interesting as the details emerge just why they believe that Intel does."
Intel will likely try to argue that Digital's patents should never have been granted because they were based on pre-existing technology, Brookwood said. Digital will have to justify in court why it did not bring its case sooner, he said.
Beyond money, Digital's lawsuit may be an attempt to instill "some fear, loathing and back to the drawing board mentality" among the Merced team at Intel, Shannon said. He added, "[Digital wants] to ensure their role as the dominant provider of the 64-bit architecture, and ensure that when Intel delivers the 64-bit architecture that it isn't 'Alpha Inside'."
-- Sari Kalin IDG News Service, Boston Bureau
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SGI's forthcoming chips aim to maximize memory bandwidth and eliminate processor-to-memory bottlenecks in part by building bandwidth right into the processor itself, SGI officials said. Up to now, increasing CPU core clock speeds alone has boosted performance, but because clock speeds have increased faster than memory interface speeds, this technique engenders higher memory latency and a slower overall application performance, officials said. Adding bandwidth directly to the processor will help eliminate the bottleneck by quickly moving and processing increasingly complex data on and off the processor, they said.
One observer praised SGI's MIPS design decision. "The evidence is there that designing high bandwith into the chip architecture is the way to go," said Petr ffoulkes, an analyst with San Jose, California-based Dataquest Inc. "Most people can build fast processors but getting the data through the rest of the system is creating a bottleneck."
The three new chip designs, expected to arrive in succession over the next few years, include the following:
-- Rebecca Sykes IDG News Service, Boston Bureau
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Stanley J. Meresman yesterday quit as SGI's chief financial officer, while Michael Ramsey, senior vice president of the company's desktop group, also resigned. Both left to pursue other interests, the company said.
The company's new computer systems organization will include all of SGI's computer products -- desktop graphics workstations, high-performance servers, supercomputing systems from Cray, and visualization supercomputers. Manufacturing has been brought into the computer systems group -- it was previously a separate unit.
This unit will be headed by executive vice president Robert Ewald, previously president of SGI's Cray Research subsidiary. SGI bought Cray last year, officials said.
Another unit will consolidate administrative support functions into a corporate operations group, which will be headed by senior vice president William Kelly, who previously was general counsel for the Silicon Interactive group.
A third group will combine SGI's service and support operations into a single customer and professional services group.
The moves follow an earnings report in which SGI said its earnings had dropped from US$53 million in the third quarter of 1996 to $11 million for the most recent quarter ended March 31.
SGI had a strong presence and focus in multimedia graphics and entertainment, before it expanded into the commercial marketplace with the Origin family, said Jerry Sheridan, an analyst with Dataquest Inc. That effort has yet to bear fruit, he said. "Bringing all of their products under one head, I see as a more consistent, more unified and more focused approach to satisfying their legacy environment," especially as SGI expands into the commercial marketplace, he said.
-- Ed Golden, IDG News Service, Boston Bureau
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Microsoft will make its Java virtual machine for the Unix platform available running on the top five Unix variants based on market share, said James Plamondon of the company's developer relations group. Though he declined to name the specific versions of Unix that will be supported, Solaris does fit into this "top five" space.
Microsoft plans to distribute the Java virtual machine as part of Internet Explorer 4.0 for Unix, which is due out by the end of the year, he said. It will also look for marketing deals with Unix vendors, he said, speculating that Hewlett-Packard Co. and Digital Equipment Corp. may be good candidates. He added that he doubts that Sun Microsystems Inc. will ship Microsoft's version of the Java virtual machine. Plamondon declined to delve into specifics about Microsoft's plans to deliver its virtual machine for other operating systems such as OS/2, MVS, and OS/400.
-- Sari Kalin, IDG News Service, Boston Bureau. With additional reporting by SunWorld staff
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