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Intel rethinks its InfiniBand strategy

Company cancels chipset production but still backs high-speed I/O technology.

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Intel's decision last week to cancel plans to ship InfiniBand chips in 2003 is causing some ripples in the market, but shouldn't be construed as a significant setback for the high-speed I/O switching fabric, industry observers say.

While some contend that Intel's news comes at a difficult time for InfiniBand as first-generation products are being delivered for testing, others say the development will do little to change the course of the market. The Yankee Group and IDC say their InfiniBand forecasts remain unchanged. The Yankee Group predicts that by 2005, 42% of all servers shipped will be InfiniBand-enabled; IDC pegs that number at 50%.

"There's been a perception . . . that the sky is falling," says Jamie Gruener, a Yankee Group analyst. "That's not the case."

Nathan McQueen, systems architect at the University of Washington in Seattle, agrees. He says he's unfazed by Intel's decision, even though he has used Intel InfiniBand products in his testing lab for the past six months.

"It seems bad because everybody takes the [announcement] as gloom and doom, but it doesn't really alter the field that much," McQueen says. "In terms of how they're pulling back, the decision not to produce chips doesn't concern me because they've invested in some of these start-ups that are making chips."

Intel has investments in several InfiniBand companies, including Mellanox Technologies, which makes silicon, and Lane 15 Software, which makes management software.

"I don't see them going away from the leadership role they've taken in the steering committee or in the product development at all either," McQueen says. "They're still going to work with standards and do things like that."

Intel is a major force in the InfiniBand movement and was a founding member of the InfiniBand Trade Association along with Compaq, Dell, Hewlett-Packard, IBM, Microsoft and Sun. InfiniBand has been hailed as the fix for I/O server processing bottlenecks by providing connections between server, storage and network devices of 2.5G to 30G bit/sec. Current bus technology supports speeds up to 1G bit/sec.

More than 70 companies are expected to bring InfiniBand products to market. Delivery could begin later this year.

Allyson Klein, industry marketing manager for Intel's InfiniBand efforts, says that while Intel has decided not to ship a product, it remains "very committed" to the InfiniBand technology. Intel continues to sit on the InfiniBand Trade Association steering committee and supports InfiniBand through initiatives such as its InfiniBand interoperability lab and its product development kits.

Intel decided against shipping the Host Channel Adapter (HCA) modules, which sit in InfiniBand-enabled servers to direct packets to InfiniBand switches for delivery to and from remote devices, in order to "refocus our efforts on our core business, specifically server chipsets," Klein says.

Intel is focusing on PCI-Express, formerly called 3GIO, and is making that an open interface to give components such as InfiniBand HCAs direct access to Intel chipsets, Klein says.

In the meantime, companies such as IBM and Mellanox are focused on delivering HCAs. The companies are working on delivering a 10G bit/sec InfiniBand chip, while Intel was focused on the 2.5G bit/sec version.

That may have influenced Intel's decision to step back, some analysts say.

"Intel was way behind in product. There are plenty of others who are much further along, like IBM and Mellanox," says Steve Duplessie, an Enterprise Storage Group analyst. "[Intel] didn't stop supporting InfiniBand; they simply recognized that others were beating them to the punch with [faster] technologies."

Regardless, momentum behind InfiniBand continues. Dell recently announced a partnership with Microsoft to develop InfiniBand technology and will incorporate InfiniBand into its brick servers next year.

Venture capital also has been flowing. In the first quarter, InfiniBand companies InfiniCon, Mellanox, Voltaire and OmegaBand received a total of $101.7 million in funding. Mellanox secured the bulk of that total, getting $56 million in a third round of funding.

Ashley Leeds, a partner at Baker Capital in New York, says Intel's move doesn't change her views on the prospects for the emerging technology. Earlier this year, Baker led a $13.2 million round of investment in Voltaire, which makes an InfiniBand-enabled switch/ router.

"There is no single player, even a large one like Intel, that can really make or break this market. It's not good news, but it's not something that's keeping me up at night," she says.

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