WSJ on SGI capitulation to Wintel
WSJ article this morning "Silicon Graphics Finally Bows to Wintel's Growing Power" at interactive.wsj.com (paid subscription required). Some salient excerpts:
Edward McCracken, Silicon Graphics' chairman, told a group of analysts Friday that Microsoft and Intel had become the "air and water" of the computing industry. "He said you have to accept that and not resist them as the evil empire," said Kurt King, an analyst who attended the meeting.
And then this:
William Kelly, Silicon Graphics' senior vice president for corporate operations...said the new line won't be shipped in the current fiscal year ending next June 30, indicating that it won't be available until the second half of 1998. When it does ship, "it will be significant," Mr. Kelly said. "We expect it to be a big-volume business. Our goal is to be the No. 1 engineering-workstation company, and you can't do that without having an NT product."
Then turning to the implications for SUNW:
Some analysts believe that Sun can thrive for many years at the high end of server computing, because Microsoft's NT and Intel's chips aren't yet powerful enough to support huge networks and millions of transactions. But Intel is working on a new microprocessor with Hewlett-Packard and Microsoft and numerous allies are developing network software for big, fail-safe networks. The two companies expect to use these new technologies to sweep into the high-end server market within three years. Intel technologists talk of corporate customers eventually being able to buy Wintel machines running anywhere from one microprocessor to 9,000 microprocessors. (Intel has built a supercomputer running on 9,000 microprocessors).
"To the degree that the computer market becomes homogenous, Sun will have failed," said [Goldman Sachs analyst] Ms. Conigliaro. But she added that Sun has little to worry about for the next three years as Intel and Microsoft struggle to improve their large-scale offerings.
We're beyond writing on the wall now. The flashing neon signs have been installed. |
