Advanced Micro Devices has shaken up the server industry in the year since it introduced its 32-\/64-bit Opteron chip, opening the world of 64-bit computing to business users looking for expanded performance, but with industry-standard pricing.Advanced Micro Devices has shaken up the\u00a0server\u00a0industry in the year since it introduced its 32-\/64-bit Opteron chip, opening the world of 64-bit computing to business users looking for expanded performance, but with industry-standard pricing.On Thursday, AMD will play host at an event in New York celebrating the one-year anniversary of Opteron, which lets users run 32- and 64-bit applications on the same platform.The chip has been widely embraced, and all major systems vendors - except\u00a0Dell\u00a0- have shipped products based on the processor, helping AMD's financial picture. Last week, the company reported first-quarter sales of $1.2 billion, up 73% compared with the same quarter last year. Net income for the quarter was $45 million, compared with a net loss of $146 million last year.By forging partnerships with\u00a0HP,\u00a0IBM\u00a0and\u00a0Sun, AMD has put pressure on\u00a0Intel, which until now faced almost no competition in the high-volume, low-end of the server market, where it holds about a 98% share, according to IDC. In February, Intel announced that it, too,\u00a0would roll out 64-bit extension technology, called Intel Extended Memory 64 Technology (EM64T), for its x86 processors.Intel says a dual-processor Xeon with EM64T technology, code-named Nocona, will debut in the next few months. Intel's MP Xeon for multiprocessor servers would get the extension technology in 2005.The AMD\/Intel competition "is going to make the technology race a lot more aggressive, as well as likely result in more competitive pricing for customers," says Jamie Gruener, a senior analyst with The Yankee Group. "But customers will really have to do their homework to determine which platform is best for the application they're trying to run."For AMD, the biggest challenge will be to continue enhancing Opteron for enterprise use, which means looking beyond processor speed improvements to designing chipsets that provide more reliability and management capabilities that corporate users demand.It's this system-focused perspective that may give Intel the edge once Nocona-based systems start rolling out. Dell, HP and IBM have said they will use Nocona."Intel has been focusing consistently not only on chip design, but also focusing on elements around the chip: the chipset, architecting the management better, system health. They've done a lot of work to improve the server platform in the last couple of iterations of their chips," Gruener says. "While AMD has done a good job of designing a really [high-performance] platform, there is a lot more that has to go into it."Still, the systems vendors continue to roll out Opteron-based products. This week HP is expected to announce shipment of the four-way, $8,300, Opteron-based\u00a0DL 585 it introduced in February. The company is already shipping the two-processor Opteron-based DL 145.HP also is expected this week to announce a new Linux-based cluster that uses DL 145 boxes.Meanwhile Sun is expected to announce a pre-tested hardware and software bundle for secure Web serving, which includes its Opteron-based v20z, Java Web Server and Solaris operating system.Road aheadAMD celebrates the first anniversary of its Opteron processor with Sun, HP and IBM all offering servers based on the 32-\/64-bit chip. Now Intel is about to get into the game.Challenges:\u2022Intel plans to roll out EM64T, giving Xeon 64-bit capabilities, in the next few months.\u2022AMD needs to look beyond processor speeds and work with OEMs to improve management and system health technology.\u2022AMD must be clear about the differences between the two offerings, or customers may opt for Intel because it\u2019s a name they know better.Strategies:\u2022AMD is portraying the Intel threat as good for the technology, saying it further validates Opteron.\u2022AMD says more low-power options, blade and four-way con-figurations, better-performing processors and more application support are just some of the areas where it\u2019s focusing.\u2022Unlike Intel, AMD embeds its memory controller into the chip and also uses HyperTransport technology to transfer I\/O requests between processors.Opteron and Intel's EM64T might end up slowing adoption of Intel's 64-bit Itanium, at least on the low end, analysts say. While Opteron and EM64T are not positioned to compete against Itanium, which offers higher-end RISC-like performance, most analysts and industry observers agree that the swell of support around Opteron is what forced Intel to introduce EM64T."To a degree that there wasn't a real alternative, I believe Intel would have just continued to plug Itanium until Itanium won by default," says Gordon Haff, an analyst at Illuminata. "Certainly, there would have been other potential dark horses like IBM Power. But Opteron lent a certain urgency to Intel to counter, lest they potentially lose a chunk of the market."The market is clearly there. According to IDC, about 35,000 Opteron-based systems shipped in 2003 after AMD introduced the chip on April 22, compared with about 19,000 Itanium systems for Intel for all of 2003."I don't want to come off saying this is an Itanium killer, because I don't think it is," says John Enck, a research vice president at Gartner. "But certainly it creates barriers for Itanium to move into this high-volume market. . . . Intel wanted to speed up the transition from Xeon to Itanium. By being forced into expanding the Xeon technology, that obviously has a slowing effect on Itanium adoption in the high-volume market.""One of the largest roadblocks for migrating to a 64-bit architecture system is running all the 32-bit applications that we have a considerable investment in," says Wade Phillips, technology and IS manager at Shakopee School District in Minnesota. "From a public education perspective, it would be nearly impossible to implement 64-bit computing without stepped migration where we can run both types of applications."