HP Itanium Servers Sell Less and Less

HP may be paying Intel to keep making Itanium processors, and is supposed to keep doing so for years, but it might soon come to pass that this isn't a viable marketing tactic anymore. 

For those who don't know or remember, Oracle, earlier this year (2011) said it was no longer making new software for Itanium servers.

This immediately sparked outrage, especially on HP's part, leading to even lawsuits, or one of them at least.

Nevertheless, despite its efforts (it even admitted it has been paying Intel to keep Itanium alive, sort of), HP isn't seeing the long end of the stick, so to speak.

According to the earnings call with financial analysts, the company has been forced to cope with dwindling sales of Itanium-based servers.

Mission-critical servers are used by very large corporations, but said customers don't like to risk the future of their operations.

Buying Itanium platforms when Oracle, the main provider of software for them, doesn't want to support them anymore is definitely one such risk.

Oracle officially said it would stop platform support because the Xeon processors can fill that spot easily, but others, HP included, believe this is a means for Oracle to promote Sun SPARC servers.

This, ultimately, has little bearing, however, as the effect on the industry is real.

"As we mentioned last quarter, we are seeing the macro slowdown impact Industry Standard Servers. Revenue in ISS declined 4% year over year. Revenue in business critical systems [BCS] declined 23% year over year primarily due to a decline in our Itanium-based servers,” said Meg Whitman, chief executive officer of HP.

“Our ability to close deals has been impacted by Oracle's Itanium decision, and we are working diligently to enforce the commitments that Oracle has made to our customers and to HP."

HP and Oracle will probably keep arguing over this for months, maybe years. Such high-profile quarrels tend to take long, after all.

Posted in: Hardware, News