15 ms·

The Huge Premium Intel Is Charging for Skylake Xeons

170 points by Katydid 9y ago

ythn 9y ago
Simple, buy AMD
- jandrese 9y ago
  Not so simple when you want to buy server quality motherboards.
  - kinghajj 9y ago
    Do these not count? https://www.supermicro.com/products/nfo/AMD_SP3.cfm https://www.supermicro.com/products/nfo/AMD_SP3.cfm
    - jandrese 9y ago
      Possibly, assuming they make something that fits your needs. The market is really shallow at the moment.
    - snuxoll 9y ago
      The other issue is buying the chips themselves, they're only available to OEM partners right now AFAICT (not listed on Newegg or anywhere else I'd expect to be able to buy retail boxed server CPUs).
  - Prego 9y ago
    Exactly. If you just sit and play games and don't care if your computer kernel panics and don't care if bits flip in your memory (with no ECC) then AMD is for you! But if you're doing real work, don't bother.
- moonbug 9y ago
  Not in channel yet. Intel are making hay from those customers who need to buy in the next quarter.
gigatexal 9y ago
In an interesting (to me at least) move intel instead of competing on price when AMD put out a competitive offering they decided to keep prices the same more or less or increase them by adding value. Faster AVX units, more cores, more SKUs (not sure about that last one). And while intel has margins to maintain AMD has put features into their chips for years. For example AES has been shipping in most every desktop and server CPU while only some intel ones get it. Most AMD chips can do VT-D etc while the same feature is relegated to higher end chips generally on intel.
- simias 9y ago
  I could be wrong but I assume that there's enough inertia in the high-end business-to-business side of things (the part that matters for high-end server processors) that they probably can keep milking that cow for a few years more. People who have only been buying Intel CPU in the last decade won't jump ship immediately. Nobody gets fired for buying Intel CPUs, at least until very recently. You know you won't have compatibility issues etc... Of course within the next few years Intel will have to react somehow, either by outperforming AMD significantly to justify the premium or by slashing prices.
  - gigatexal 9y ago
    I know I hope AMD can keep up the pressure and keep iterating.
  - douglasfshearer 9y ago
    > Nobody ever got fired for buying IBM. Replace IBM with Intel for the 2010s version.
    - tengbretson 9y ago
      And yet there are still people out there buying IBM and somehow not getting fired for it.
      - abakker 9y ago
yuhong 9y ago
I have been thinking about whether GitLab should buy the M versions that can do 1.5TB of RAM per socket with 128GB 3DS LR-DIMMs. They will probably not use them immediately though. Of course, I think the price gap between 64GB LR-DIMMs and 32GB RDIMMs are falling.
- Svenstaro 9y ago
  I thought Gitlab went back on the idea of using their own hardware anyway?
  - CSDude 9y ago
    They can't even manage the managed servers, it has issues too many times
    - Svenstaro 9y ago
      I'm painfully aware of that. :(
  - yuhong 9y ago
    I am obviously not suggesting that they buy the servers now.
imtringued 9y ago
Server CPUs are way too cheap compared to the remaining parts of the server. Paying 10% more in exchange for software compatibility is a steal.
- Retric 9y ago
  What software compatibility issue?
  - Xorlev 9y ago
    Different CPUs perform subtly different. Not to mention that server-class workloads tend to expose bugs and architectural shortfalls. Ryzen hasn't had great press in this regard, so decision makers are going to regard AMD with some skepticism to begin with. It's about risk: you know Intel chips roughly perform as they always have, just a little better each generation. Additionally, if you rely on Intel's compiler to get more performance out of your chips, well, switching to AMD doesn't make a whole lot of sense. AMD needs to be back in the server space for a while before they'll be trusted again.
    - gaius 9y ago
      What's a server class workload in this context? Remember that Intel's embarrassing FDIV bug was spotted in Excel...
    - tylerjd 9y ago
      I agree with most of what you said, but Kaby Lake had issues with Hyperthreading, and Haswell had to fully disable the TXT extensions, both modified (fixed/disabled) through microcode updates. You could say Intel hasn't had great press either. That being said, I still agree AMD still needs to prove their new platform in the server space.
      - bonzini 9y ago
        For what it's worth, it's TSX (hardware transactional memory), not TXT (secure firmware). It's a very niche feature, compared to hyperthreading.
csdreamer7 9y ago
With the concentration of server buying by AWS I am surprised Intel believes it can get away with this. AWS has the expertise and the incentive to push for supporting a competitor that offers a superior value.
- stu2010 9y ago
  I'd bet that the cloud-scale customers like AWS negotiate pricing that has very little to do with the published list price of these CPUs.
  - colechristensen 9y ago
    More than that, Intel builds custom chips to AWS specs.
    - klodolph 9y ago
      Kind of. From what I understand, any customer large enough can get small features added, and they just get turned off for the other customers.
      - gsnedders 9y ago
        Depends on the feature, as far as I can tell. Intel has been known to do entirely custom chips, if the price is right (and realistically, you need lots of volume to be able to justify the setup cost of it).
        temac 9y ago
        If we are talking about modern processors, I doubt they are going to do custom masks.
        klodolph 9y ago
        There's no way the price is right for custom Skylake Xeons, especially considering how easy it is to disable features on chips after you make them.
std_throwaway 9y ago
Q: Why is Intel charging so much? A: Because enough people pay. Q: Why do people pay so much? Why do they pay a high premium for top performance? A: Because, considering all factors, it's worth that much for them. For many it's too much but for many others it's ok. Q: But it's the same silicon! A: Manufacturing cost plays little role when the price is not dictated by a race to the bottom between different manufactures. Instead, marketing, market segmentation and customer value are the cost determining factors.
- ajross 9y ago
  That's really not what the article is about at all. It's talking about the history of the tech industry and associating this kind of price motion with "peak" revenue for given hardware products. Your same answer would apply to IBM's mainframes in 1990 and Sun's servers in 2001 too, and the point of the article is to associate Intel's current position with those products, which clearly reached peaks at those moments. Personally I don't really buy it completely either, but quipping "because the market!" as an answer is missing the point. The article is about what that market desire means for future revenue.
  - pjmlp 9y ago
    Another example missing in the article was the graphics workstations with SGI.
    - nwatson 9y ago
      I remember considering spending lots of student-budget money in 1993 for an SGI Indy (https://en.wikipedia.org/wiki/SGI_Indy https://en.wikipedia.org/wiki/SGI_Indy), a low-end graphics workstation from SGI. I think this was shortly before peak-SGI. I'm glad I didn't, because (a) PCs started to see impressive graphics performance improvements not so longer after; (b) I went to industry and ended up working in enterprise software instead. SGI market cap peaked in 1995, here's a HN discussion of a 1997 article of SGI's "Sad Saga": https://news.ycombinator.com/item?id=8462841 https://news.ycombinator.com/item?id=8462841 . They shifted focus to scientific/enterprise compute and storage after and dwindled away.
throw2016 9y ago
Most markets feel comfortable and safe with Intel. AMD will have to go through the tough adoption curve of early adopters to mature markets and while this happens Intel has relatively free reign with their pricing and value. Markets with long established leaders have the additional burden of too many vested interests, misinformation and dirty tricks. However if AMD continues to deliver the naysayers will eventually lose credibility.
- BoorishBears 9y ago
  AMD fans like to separate RTG from AMD, but anecdotally, I just got a Vega 64 GPU and it's horrible. Loud, constant crashes, my desktop freezes when a video starts playing, etc. Stuff like that makes me unwilling to go with AMD when I have a choice. I view them as offering competitive performance on paper but completely falling short when it comes to reliability.
  - quickben 9y ago
    On another hand, in the cpu space, I went to top of the line Intel CPU overheating and throttling, to 8 core Ryzen, doing 45 celsius at 100 percent load and almost 4ghz across 8 cores. Stuff like Intel unable to perform below 80 degrees on 4 cores, makes people switch with ease.
    - paulmd 9y ago
      > I went to top of the line Intel CPU overheating and throttling Frankly I've never heard of a 6950X overheating and throttling, the lid is soldered on those processors. Sounds like a personal problem.
      - quickben 9y ago
        I wasn't taking about the lid. The raw thermal output is different under a full non-transient load. Why the cynism?
        9y ago
throwaway613834 9y ago
Basically off-topic, but this might be one of the few places someone might know: does anyone know which of the quad-core 8th generation Intel CPUs that are about to come out in laptops support TSX-NI? I can't find this information on their site.
TheDongIsYou 9y ago
This is a very good overview of bad anti-consumer practices Intel has done throughout the last 30 years: https://youtu.be/osSMJRyxG0k https://youtu.be/osSMJRyxG0k

170 points by Katydid 9y ago

ythn 9y ago

Simple, buy AMD

jandrese 9y ago
Not so simple when you want to buy server quality motherboards.
- kinghajj 9y ago
  Do these not count? https://www.supermicro.com/products/nfo/AMD_SP3.cfm https://www.supermicro.com/products/nfo/AMD_SP3.cfm
  - jandrese 9y ago
    Possibly, assuming they make something that fits your needs. The market is really shallow at the moment.
  - snuxoll 9y ago
    The other issue is buying the chips themselves, they're only available to OEM partners right now AFAICT (not listed on Newegg or anywhere else I'd expect to be able to buy retail boxed server CPUs).
- Prego 9y ago
  Exactly. If you just sit and play games and don't care if your computer kernel panics and don't care if bits flip in your memory (with no ECC) then AMD is for you! But if you're doing real work, don't bother.
moonbug 9y ago
Not in channel yet. Intel are making hay from those customers who need to buy in the next quarter.

gigatexal 9y ago

In an interesting (to me at least) move intel instead of competing on price when AMD put out a competitive offering they decided to keep prices the same more or less or increase them by adding value. Faster AVX units, more cores, more SKUs (not sure about that last one). And while intel has margins to maintain AMD has put features into their chips for years. For example AES has been shipping in most every desktop and server CPU while only some intel ones get it. Most AMD chips can do VT-D etc while the same feature is relegated to higher end chips generally on intel.

simias 9y ago
I could be wrong but I assume that there's enough inertia in the high-end business-to-business side of things (the part that matters for high-end server processors) that they probably can keep milking that cow for a few years more. People who have only been buying Intel CPU in the last decade won't jump ship immediately. Nobody gets fired for buying Intel CPUs, at least until very recently. You know you won't have compatibility issues etc... Of course within the next few years Intel will have to react somehow, either by outperforming AMD significantly to justify the premium or by slashing prices.
- gigatexal 9y ago
  I know I hope AMD can keep up the pressure and keep iterating.
- douglasfshearer 9y ago
  > Nobody ever got fired for buying IBM. Replace IBM with Intel for the 2010s version.
  - tengbretson 9y ago
    And yet there are still people out there buying IBM and somehow not getting fired for it.
    - abakker 9y ago

yuhong 9y ago

I have been thinking about whether GitLab should buy the M versions that can do 1.5TB of RAM per socket with 128GB 3DS LR-DIMMs. They will probably not use them immediately though. Of course, I think the price gap between 64GB LR-DIMMs and 32GB RDIMMs are falling.

Svenstaro 9y ago
I thought Gitlab went back on the idea of using their own hardware anyway?
- CSDude 9y ago
  They can't even manage the managed servers, it has issues too many times
  - Svenstaro 9y ago
    I'm painfully aware of that. :(
- yuhong 9y ago
  I am obviously not suggesting that they buy the servers now.

imtringued 9y ago

Server CPUs are way too cheap compared to the remaining parts of the server. Paying 10% more in exchange for software compatibility is a steal.

Retric 9y ago
What software compatibility issue?
- Xorlev 9y ago
  Different CPUs perform subtly different. Not to mention that server-class workloads tend to expose bugs and architectural shortfalls. Ryzen hasn't had great press in this regard, so decision makers are going to regard AMD with some skepticism to begin with. It's about risk: you know Intel chips roughly perform as they always have, just a little better each generation. Additionally, if you rely on Intel's compiler to get more performance out of your chips, well, switching to AMD doesn't make a whole lot of sense. AMD needs to be back in the server space for a while before they'll be trusted again.
  - gaius 9y ago
    What's a server class workload in this context? Remember that Intel's embarrassing FDIV bug was spotted in Excel...
  - tylerjd 9y ago
    I agree with most of what you said, but Kaby Lake had issues with Hyperthreading, and Haswell had to fully disable the TXT extensions, both modified (fixed/disabled) through microcode updates. You could say Intel hasn't had great press either. That being said, I still agree AMD still needs to prove their new platform in the server space.
    - bonzini 9y ago
      For what it's worth, it's TSX (hardware transactional memory), not TXT (secure firmware). It's a very niche feature, compared to hyperthreading.

csdreamer7 9y ago

With the concentration of server buying by AWS I am surprised Intel believes it can get away with this. AWS has the expertise and the incentive to push for supporting a competitor that offers a superior value.

stu2010 9y ago
I'd bet that the cloud-scale customers like AWS negotiate pricing that has very little to do with the published list price of these CPUs.
- colechristensen 9y ago
  More than that, Intel builds custom chips to AWS specs.
  - klodolph 9y ago
    Kind of. From what I understand, any customer large enough can get small features added, and they just get turned off for the other customers.
    - gsnedders 9y ago
      Depends on the feature, as far as I can tell. Intel has been known to do entirely custom chips, if the price is right (and realistically, you need lots of volume to be able to justify the setup cost of it).
      - temac 9y ago
        If we are talking about modern processors, I doubt they are going to do custom masks.
      - klodolph 9y ago
        There's no way the price is right for custom Skylake Xeons, especially considering how easy it is to disable features on chips after you make them.

std_throwaway 9y ago

Q: Why is Intel charging so much? A: Because enough people pay. Q: Why do people pay so much? Why do they pay a high premium for top performance? A: Because, considering all factors, it's worth that much for them. For many it's too much but for many others it's ok. Q: But it's the same silicon! A: Manufacturing cost plays little role when the price is not dictated by a race to the bottom between different manufactures. Instead, marketing, market segmentation and customer value are the cost determining factors.

ajross 9y ago
That's really not what the article is about at all. It's talking about the history of the tech industry and associating this kind of price motion with "peak" revenue for given hardware products. Your same answer would apply to IBM's mainframes in 1990 and Sun's servers in 2001 too, and the point of the article is to associate Intel's current position with those products, which clearly reached peaks at those moments. Personally I don't really buy it completely either, but quipping "because the market!" as an answer is missing the point. The article is about what that market desire means for future revenue.
- pjmlp 9y ago
  Another example missing in the article was the graphics workstations with SGI.
  - nwatson 9y ago
    I remember considering spending lots of student-budget money in 1993 for an SGI Indy (https://en.wikipedia.org/wiki/SGI_Indy https://en.wikipedia.org/wiki/SGI_Indy), a low-end graphics workstation from SGI. I think this was shortly before peak-SGI. I'm glad I didn't, because (a) PCs started to see impressive graphics performance improvements not so longer after; (b) I went to industry and ended up working in enterprise software instead. SGI market cap peaked in 1995, here's a HN discussion of a 1997 article of SGI's "Sad Saga": https://news.ycombinator.com/item?id=8462841 https://news.ycombinator.com/item?id=8462841 . They shifted focus to scientific/enterprise compute and storage after and dwindled away.

throw2016 9y ago

Most markets feel comfortable and safe with Intel. AMD will have to go through the tough adoption curve of early adopters to mature markets and while this happens Intel has relatively free reign with their pricing and value. Markets with long established leaders have the additional burden of too many vested interests, misinformation and dirty tricks. However if AMD continues to deliver the naysayers will eventually lose credibility.

BoorishBears 9y ago
AMD fans like to separate RTG from AMD, but anecdotally, I just got a Vega 64 GPU and it's horrible. Loud, constant crashes, my desktop freezes when a video starts playing, etc. Stuff like that makes me unwilling to go with AMD when I have a choice. I view them as offering competitive performance on paper but completely falling short when it comes to reliability.
- quickben 9y ago
  On another hand, in the cpu space, I went to top of the line Intel CPU overheating and throttling, to 8 core Ryzen, doing 45 celsius at 100 percent load and almost 4ghz across 8 cores. Stuff like Intel unable to perform below 80 degrees on 4 cores, makes people switch with ease.
  - paulmd 9y ago
    > I went to top of the line Intel CPU overheating and throttling Frankly I've never heard of a 6950X overheating and throttling, the lid is soldered on those processors. Sounds like a personal problem.
    - quickben 9y ago
      I wasn't taking about the lid. The raw thermal output is different under a full non-transient load. Why the cynism?
      - 9y ago

throwaway613834 9y ago

Basically off-topic, but this might be one of the few places someone might know: does anyone know which of the quad-core 8th generation Intel CPUs that are about to come out in laptops support TSX-NI? I can't find this information on their site.

TheDongIsYou 9y ago

This is a very good overview of bad anti-consumer practices Intel has done throughout the last 30 years: https://youtu.be/osSMJRyxG0k https://youtu.be/osSMJRyxG0k