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The Gate
Saturday, September 6, 1997 ú Page D1
c1997 San Francisco Chronicle
Silicon Graphics To Make `Wintel' Workstations
David Einstein, Chronicle Staff Writer
MOUNTAIN VIEW
The Wintel juggernaut claimed another convert yesterday when
Silicon Graphics said it will develop workstations that use Intel chips
and Microsoft's Windows NT operating system.
The decision by Mountain View-based SGI was seen as a
concession to the growing clout of NT, which is becoming the
software of choice for running corporate networks. It also reflects
the waning popularity of Unix, which had been the standard
operating system for workstations until NT came along.
SGI workstations use a version of Unix along with chips made by
MIPs, an SGI subsidiary. Over the past two years, the company has
seen the low end of its market invaded by personal computers
equipped with Intel Pentiums and NT. Such systems offer
workstation-caliber performance at a lower cost.
In a meeting with analysts yesterday, SGI said it plans to introduce
Intel-Microsoft workstations in the second half of 1998. ``We
expect there to be a volume market for them, and they'll be a
significant part of our product line,'' said Bill Kelly, senior vice
president of corporate operations.
Kelly claimed the move would have no impact on MIPs, which also
sells chips to other companies including Nintendo for the Nintendo
64 video game.
SGI will not abandon Unix, largely because it must be able to offer
compatible new products to its existing customers. But if current
market trends continue, the company could end up selling more NT-
based desktop workstations than ones using Unix.
``NT has gotten so good as a workstation platform that Unix, at
least on the low end, does certainly appear to be on the wane,'' said
Daniel Kunstler of J.P. Morgan.
David Wu of ABN AMRO Chicago Corp. said that ``SGI's
recognition of reality is a positive. These guys are a bunch of Unix
freaks, and if they've seen the error of their ways, you know they're
not going the way of Apple.''
The move will leave Apple Computer and SGI rival Sun
Microsystems as the only computer makers relying on their own
chips and operating systems.
SGI recently has appeared to be climbing out of a financial hole in
which it languished for more than a year. With a major reorganization
behind it and new products on the market, it reported
better-than-expected fourth-quarter earnings last month.
The company's stock also has been on an upward jag, more than
doubling its value since April. It gained $1.31 yesterday to close at a
52-week high of $29.56.
Officials at Intel were obviously pleased by SGI's move to embrace
its chips. ``If they can bring their visual expertise onto a standard
industry architecture, they should be able to offer a more
cost-competitive product,'' said Howard High, a spokesman for the
giant chipmaker. ``And that's good for the market place and the
customer.''
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