Last week, I had a long conversation with representatives from Intel about the company's plans for the Itanium family of 64-bit microprocessors, how the release of Windows Server 2003 and Microsoft SQL Server 2000 Enterprise Edition (64-bit) will bolster those plans, and the ways in which the long-awaited migration to 64-bit computing is finally showing some traction. Intel, you might recall, first released its Itanium processor family 2 years ago, and Microsoft responded with two limited-edition (and prerelease) Windows releases to support the platform: Windows XP 64-Bit Edition and Windows Advanced Server Limited Edition . Today, Microsoft is prepping the launch of the final versions of these products, and Intel is ready with a new Itanium version, the Itanium 2. Intel will also begin implementing an aggressive processor release schedule that will see the company upgrading its enterprise offerings at least twice a year going forward. A lot has changed in 2 years.

First, some technical details. On the 64-bit front, Itanium 2-based systems now support up to 64 processors and a whopping 512GB of RAM, a massive change from the 8 processor and 64GB of RAM systems that were shipping two summers ago. The processors support larger page sizes than their predecessors, for better performance, and Enhanced Machine Check Architecture, for extensive error detection, correction, and logging functionality. This last feature lets the processors identify and fix processor-level problems or provide information to the OS so that the OS can fix the problem. The end result is a much more stable and reliable system, Intel says.

Going forward, Intel will upgrade the Itanium family frequently, a welcome change from the relatively glacial development pace until now. In summer 2003, Intel will unleash its next Itanium 2, code-named Madison, which will feature a clock frequency of 1.5GHz, up from 1GHz today, and 6MB of cache, up from 3MB today. And in late 2003, the company will release a new low-voltage version of the Itanium 2, code-named Deerfield, in response to requests from customers who wanted a smaller, less expensive, less heat-generating solution that would be more appropriate for smaller, denser, rack-mounted systems. Looking to 2004, we can expect faster speeds, smaller die sizes, and larger cache sizes. A version of the Madison chip featuring 9MB of cache will ship in early 2004, I'm told, and a late-2004 version code-named Montecito will feature dual-processor cores and an even larger cache.

Intel has good reason to improve these processors as quickly as possible, even though the 64-bit market still represents a relatively small part of the overall server market. Despite the fact that 88 percent of all servers sold are based on Intel technology, the company takes in only 50 percent of the overall revenues. The other 50 percent is largely owned by RISC-based server systems from Sun Microsystems, IBM, and other high-end companies. And that 50 percent represents a $20 billion market opportunity, Intel told me, an opportunity the company intends to seize.

Historically, performance of Intel-based servers--running, not coincidentally, Windows-based OSs--has increased, while total cost of ownership (TCO) has decreased. In 1996, when Intel formally entered the server business, a 4-way 166MHz Pentium Pro (ah, memories) delivered 5600 transactions at a cost of $136 per transaction on the industry-standard tpmC benchmark. Today, a 4-way 1GHz Itanium 2 system delivers 87,700 transactions at a cost of only $5 per transaction. But the differences are even more impressive when you consider that the 1996 system represented a top-of-the line system for its day, while the four-processor Itanium 2 in today's benchmark barely pushes the platform's scalability limits. Now, it's possible to buy 64-way systems, and from a much wider array of OEMs. The third-party support for Intel's architecture has made all the difference.

And nowhere is the support more important, perhaps, than at Microsoft. The software giant will deliver 64-bit versions of Windows 2003, Enterprise Server and Windows 2003, Datacenter Server, as well as Windows XP 2003 for scientific workstations on April 24. Equally important is the delivery of SQL Server 2000 (64-bit), the first mainstream Microsoft server application to ship for any 64-bit platform, which will arrive the same day. These releases will help ensure the viability of the Intel 64-bit server platform.

And yet, the 64-bit platform has holes. While I was preparing a chart identifying the differences between the various Windows 2003 editions, I discovered that the 64-bit versions of these products still lack some crucial features found in the 32-bit editions. First, none of the 64-bit editions support any of the Microsoft .NET technologies. That means no Windows .NET Framework and no ASP.NET, which are critical components of many dynamic Web sites. The 64-bit versions also lack support for Internet Connection Sharing (ICS), Internet Connection Firewall (ICF), and the Windows System Resource Manager (WSRM), any of which are arguably necessary components in various scenarios.

Even more questionable is the point of XP 64-Bit Edition, a workstation OS that will run on Itanium 2-based hardware. The problem is software support. The platform has no Microsoft Office or similar end-user software, leading me to wonder what types of bizarre niche software could exist to make the system viable for end users. As Intel noted, most users of this system also maintain a separate 32-bit PC for mainstream work. But I have to wonder whether the overall market size for this product numbers in the teens.

Another obvious question is AMD, which is developing its own 64-bit platform, the Opteron, which, unlike Intel's solution, is natively compatible with the wide array of 32-bit x86 software available today (the Itanium 2 includes a kludgy x86 software-compatibility environment). AMD will announce plans for its 64-bit products later this month, so we'll know more soon. But we do know that Microsoft has pledged to support the platform. Whether the company will deliver unique Windows 2003 and XP editions targeting Opteron or release add-ons for its existing 32-bit products remains to be seen.