Intel Proves Xeon 5500 Processors Are “Cash Machines for IT”

When Intel launched “Nehalem-EP,” more commonly known as the Intel Xeon 5500 Series processors back in March, we pointed out that their energy-efficient performance and other attributes lead to a very quick return on investment – as soon as eight months. Pat Gelsinger and Kirk Skaugen even referred to the new servers as literally becoming “Cash Machines for IT.”

Intel began its accelerated server refresh strategy in 2007 – we’re replacing aging servers on a regular basis to cut operating costs, avoiding incremental data center spending and increasing capacity to ensure ongoing innovation. This is especially important since our business computing demand is growing despite economic conditions. This is driven by the innovative design and manufacturing of our chips, which are smaller, faster, and contain an increasing number of features. Our server refresh strategy generated quick results, saving us $45 million in 2008, and we’re continuing to have enormous savings. Some might question the wisdom of a server refresh strategy in the midst of challenging economic times. We actually re-evaluated the strategy but further analysis showed that halting it would actually increase operating costs by $19 million.

An added bonus is the significant energy-efficiency benefits; the server refresh strategy is the No. 1 driver of Intel IT’s carbon footprint reduction. We are projected to reduce our carbon output by 4,000 metric tons in 2009 alone.

Speaking of Green IT, did you know that the newest ally for IT to help drive carbon-reduction and energy cost savings is the energy utilities? A prime example of this is the Energy Trust of Oregon, which offers cash incentives to motivate Oregon businesses to make energy saving investments. Intel gained access to a $250,000 incentive from them as a result of energy savings gained by replacing older servers with newer, more energy-efficient servers in our data centers.

“We applaud and support efforts to reduce datacenter energy consumption at companies from all industries in Oregon,” said Corban Lester, Program Development Manager for Energy Trust’s Data Center Initiative. “By replacing older servers with modern energy-efficient servers, Enterprise IT departments and small/medium business owners may be eligible for utility incentives for energy savings and can lower their operating costs and reduce the impact of their business on the environment.”

Customers such as DreamWorks, Oracle, Humana, and BMW, are just a few of the companies reaping sizeable benefits by refreshing their data centers with Xeon 5500-based servers. In fact, DreamWorks if positively giddy over the chip.

“Nehalem is–by a substantial margin–the fastest architecture we have ever used in the render farm,” said Derek Chan, head of digital operations, DreamWorks Animation. “It performs well on a per-core basis and the wide-open I/O bandwidth lets us keep all cores busy, much more efficiently than previous architectures.”

If you’re still not convinced, try using the Xeon Server Refresh Savings Estimator server to assess the value of replacing aging x86 hardware with Xeon 5500-based servers.

You can also check out this video of a press briefing our CIO Diane Bryant recently held where she and some Intel customers discussed the success of their server refresh strategies.

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