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For AMD, Linux User Base Drives Windows Server Sales
Posted on Aug 5, 2005 at 04:50 PM by John Foley

Advanced Micro Devices got its start in the server market by supplying 64-bit processors for use as the guts in Linux-based computers. Now, AMD's stake in the ground is working to Microsoft's advantage. The chipmaker's fast-growing server business is being driven, in part, by demand for Windows-on-AMD systems sold to business customers who got their start with Linux-on-AMD.

It's not that those customers are choosing Windows over Linux. They're deploying both, according to AMD's VP of commercial business, Kevin Knox. A typical scenario is that a company will install Linux-on-AMD servers from Hewlett-Packard, IBM, or another OEM partner for a high-end clustered application, then expand its use of AMD servers in areas such as database or E-mail servers. That's when they order some Windows servers, too. "We got our foot in the door with Linux with a lot of these companies, and now they're looking at [AMD-based servers] for their Windows implementations as well."

AMD's share of the so-called x86 server market grew to 11.2% in the second quarter, according to Mercury Research, more than double what it was a year ago. The goal is to grow to 30% of the market by 2009. In general, AMD gains come at Intel's expense.

Corporate accounts include Bristol-Myers Squibb, Exxon, GE, and Nissan. Knox and about 50 AMD sales professionals work directly with business customers, even though companies purchase their AMD-based systems from computer manufacturers. "They care about the chip because they're making architectural decisions," he says. "The microprocessor can affect the code and increase performance."

Some of those customers are ordering in volume. AMD's largest business account is a Wall Street financial firm. Knox says the customer, which he declined to name, has ordered "tens of thousands" of AMD servers, including a mix of Linux and Windows. AMD's known financial-industry customers include Merrill Lynch, MetLife, and BNP Paribas.

Microsoft's release of Windows Server 2003 x64 in April has stirred interest in 64-bit applications, but that hasn't yet translated into a rush of new 64-bit Windows customers. "It's not to say we're seeing a ton of applications day one," Knox says, "but there's a lot of testing going on."

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