In a bold move to boost its position in next-generation servers, AMD will acquire low-power server specialist SeaMicro for $334 million, the companies said today.
The acquisition is a disruptive one for the low-power server landscape, as SeaMicro has been using Intel chips in its next-generation servers, which offer dramatic reductions in power and space usage. The crown jewel in the acquisition is SeaMicro's networking fabric, which allows hundreds of low-power processors to work together. The SeaMicro architecture is processor-neutral, meaning it can be quickly adapted to work with AMD's technology.
"By acquiring SeaMicro, we are accelerating AMD's transformation into an agile, disruptive innovator capable of staking a data center leadership position," said Rory Read, president and CEO, AMD. "SeaMicro is a pioneer in low-power server technology.
"We are clearly skating to where the puck is going," Read added. "This is a great company with innovative IP and great talent."
The Importance of the Cloud
AMD plans to offer the first AMD Opteron processor-based solutions that combine AMD and SeaMicro technology in the second half of 2012. The company said it remains firmly committed to its traditional server business, and will continue to invest in research and development. But AMD executives said the acquisition of SeaMicro will boost the company's offerings for cloud computing providers, who are keenly focused on reducing the energy used by their armadas of servers.
"Cloud data centers are the fastest growing segment of the server market," said Lisa Su, Senior Vice President and General Manager, Global Business Units. "The cloud has changed the dynamics of the data center and how people think about servers."
Su said AMD will offer SeaMicro servers with AMD chips to provide continuity for existing customers. But the primary focus will be on integrating SeaMicro's fabric technology with AMD processors in "building blocks" for its OEM customers.
Downsized "Building Block"
The basic building block of the SeaMicro system is a credit card-sized compute block, comprised of a CPU and its chipset, DRAM, and a custom SeaMicro ASIC (application specific integrated circuit). SeaMicro's patented I/O virtualization allows companies to save money by using fewer cables and network interface cards (NICs) to connect to networks and storage.
SeaMicro's early systems featured up to 768 Intel Atom cores in a 10U server. It recently introduced a server powered by 64 Intel Xeon processors, providing a "brawny" offering to supplement the "wimpy" Atom nodes.
One of the benefits of the AMD acquisition is the ability to adapt SeaMicro's technology to a broader range of workloads and applications, according the SeaMicro CEO Andrew Feldman.
"SeaMicro was founded to dramatically reduce the power consumed by servers, while increasing compute density and bandwidth," said Feldman, who will become general manager of AMD's newly created Data Center Server Solutions business. "By becoming a part of AMD, we will have access to new markets, resources, technology, and scale that will provide us with the opportunity to work tightly with our OEM partners as we fundamentally change the server market."