IBM is making Xeon sing -- to the tune of US$100 million.

Big Blue recently announced the eServer xSeries 366, the first dual-core capable Intel server based on its third generation Enterprise X Architecture X3 and 64-bit Intel Xeon processors. The announcement marked a key milestone in a three-year development effort which involved the incorporation of IBM"s own chipset into Intel-based servers.

According to Brendan Paget, systems manager, IBM eServer xSeries and IntelliStation, IBM Asia Pacific, work on developing the X3 architecture for Intel-based servers began about five years ago. "We made some fundamental changes...We wanted to make the Intel processor sing."

About $100 million was invested in the effort to bring technology from high end systems such as the mainframe to the industry standard server space, said Paget. With the third generation Enterprise X Architecture chipset, X3, IBM says it has put supercomputing and mainframe inspired technology like memory control, virtualization, improved data management and DRAM into its Intel xSeries servers.

"The new product line will have a lot more traction in the four-way space," said Han Chung Heng, general manager, Systems and Technology Group, IBM Asia Pacific.

Some industry analysts believe the chipset and X3 architecture are a technical breakthrough that potentially could both benefit corporate buyers as well as apply pressure to IBM"s server competitors, most notably Hewlett-Packard and Dell.

"This is big news for the x86 market because now there are fewer components doing more powerful work, which translates into lower costs and better workloads and, ultimately, hopefully consumers getting a better deal," said Vernon Turner, group vice president with IDC"s Enterprise Computing practice.

The fact that X3 does not support Itanium also came under scrutiny, with some analysts seeing it as part of IBM"s "continued de-emphasis of Itanium".

Gordon Haff, an analyst at Illuminata, said IBM"s decision not to create a parallel path of Itanium in this generation of chipset was "hardly surprising", given IBM"s increased emphasis on its own Power chip.

The core chip technology of X3 focuses on improving performance and reducing latency, enabling the system to provide more transaction and virtual machine support, said Paget.

The chipset acts as an intercommunications mechanism between the chip, the memory and the I/O. The Xeon chips have EM64T memory addressing, which leverages on the core memory controller technology of X3. According to IBM, the combination of these technologies boosts overall system performance by 35 per cent when a maximum of 64GB of memory is used, compared with the previous generation of Xeon-based systems.

X3 also features a "scalability port" that can link four-processor groups. This addresses one of the main concerns that businesses have over their system investments: "Did they overcapitalize or did they under-capitalize?"

The way to fix this, said Paget, is to start with what they have now and grow while keeping their original investment. For example, two four-way systems can be plugged together to form an eight-way system, which can then be scaled to 16 ways, or a 16-way server can be partitioned into two eight-way servers. "Mainframes have been doing this for years, but now we"re bringing the concept to Intel-based servers."

A key enabling technology for this is Numa or Non-Uniform Memory Access, which was brought into the IBM portfolio with the acquisition of Sequent. The Numa architecture is a way of building very large multiprocessor systems by connecting multiple processors or multiple groups of processors using special bus systems.

Despite the technology breakthroughs, Turner of IDC cautioned that whether or not the new technology results in IBM gaining significantly more market share over HP and Dell will largely depend on how successful it is in executing its market strategy for products based on X3.