Finally, Itanium is profitable!

Intel’s 64-bit Itanium processor never got much respect from the mainstream enterprise server buyer. A set of more established 64-bit chips based on the RISC architecture, the rapid evolution of the 32-bit x86 architecture – and then the 64-bit x86 extensions pioneered by AMD – kept the VLIW-based Itanium in a money-losing niche for ten years. But now it’s profitable. Maybe.

It’s hard to believe that it’s been a decade since Intel and Hewlett-Packard partnered to evolve HP’s PA-RISC technology into Intel’s Itanium processor. The goal was always to reach a broad market that wanted an advanced parallel-processing chip.

However, volume buyers never saw the benefit of Itanium’s 64-bit VLIW (Very Long Instruction Word) architecture. Instead, they mainly kept purchasing commodity 32-bit CISC (Complex Instruction Set Computing) chips like the Intel Xeon. If there was a need for something more scalable than the 32-bit CISC chips, server buyers went for RISC (Reduced Instruction Set Computing) processors like Sun’s SPARC or IBM’s POWER chips.

Indeed, the only significant reseller of Itanium processors was HP, in some of its high-end systems.

In part, Itanium’s problems were technological. The first chips, which shipped in 2001, didn’t deliver the performance that HP and Intel had promised. A scarcity of development tools was also a problem – it was particularly hard to create optimizing compilers that would leverage Itanium VLIW design.

While those problems were transitory – the second-generation chips, dubbed Itanium 2, were quite impressive – Itanium never stood a chance, particularly in the face of strong competition from the 64-bit extensions to the classic x86 architecture. The so-called x64 chips from AMD and Intel were a lot less expensive than Itanium 2, and had the advantage that they would run both 64-bit and existing 32-bit x86 applications.

The numbers speak clearly. Accordingly to a May 2008 story in ComputerWorld,

In fact Itanium holds only a sliver of the overall server market. Vendors sold about 55,000 Itanium servers in 2007, compared to 417,000 RISC servers and 8.4 million x86 servers, according to Gartner Inc. Intel estimates that 184,000 Itanium-based systems had been sold altogether by the end of last year.

Imagine my surprise when I read a blog post from Ashlee Vance in the New York times, “A Decade Later, Intel’s Itanium Chip Makes a Profit.” (He also notes that Intel won’t confirm this.) Will wonders never cease?