Responding once again to competitive threats from AMD, microprocessor giant Intel has scrapped its previous plans for server chips, delaying the next-generation Itanium and canceling a future Xeon revision. Intel representatives attribute the Itanium delay to quality problems. But analysts say that AMD is making headway in the server market with its 64-bit Opteron chips, chips with which Intel wasn't effectively competing.

The first version of the delayed Itaniums, codenamed Montecito, was originally due late this year. Now, the Montecito version of Itanium will ship in mid-2006, Intel says. "We need some additional time to provide the quality that Intel is known for," an Intel representative said, while offering no other details about reasons for the delay.

The clock speed of the upcoming Itanium revision will also be reduced from a planned 2 GHz to 1.6 GHz. However, Intel maintains that Montecito will still provide twice the performance of today's Itanium chips. Additionally, Intel will be removing power management technology it originally planned to introduce in Montecito. Future versions of Itanium, codenamed Montvale and Tukwila, have been delayed to 2007 and 2008, respectively.

As for the Xeon, Intel has scrapped plans for an upcoming multiprocessor version of the Intel chip, codenamed Whitefield, and will instead replace that with another version, codenamed Tigerton, that will appear in 2007. The Tigerton version of Xeon will be a quad core design, offering four processor cores in a single chip. At this time, however, Tigerton is expected to feature the same performance bottleneck that characterizes Intel's dual core chips. AMD dual core processors do not include this bottleneck and perform better as a result.

The delays and plan changes give AMD an opening in the server market. Though the Opteron accounts for just 10 percent of the server CPU market, AMD's current-generation desktop and server microprocessors are widely viewed as being technically superior to Intel's designs, while offering performance benefits.