August 06, 2013, 4:17 PM — IBM will license designs of the Power microprocessor architecture to other companies including Google, in an effort to expand use of the architecture and reverse declines in its systems hardware business.
Intellectual property of the chip design is being opened up as part of a development alliance called OpenPower Consortium that IBM announced with Google on Tuesday. Consortium members will be able to make Power chips based on architecture designs, and component companies will be able to make hardware that can be integrated, or attached, to the processor.
Other initial OpenPower partners include graphics chip maker Nvidia, server maker Tyan, and Mellanox, which makes networking and storage equipment. The first products from alliance partners could be based on IBM's upcoming Power8 design, said Brad McCredie, vice president and chief technology officer at IBM's Systems and Technology Group (STG), in an interview.
"What was happening on the board yesterday is now happening on the chip," McCredie said. "We wanted to get out ahead of that shift."
In an email statement, Google said the OpenPower Consortium "has the potential to establish Power architecture as a viable option for applications running within Google's datacenters."
Google designs its own servers, and the search company could design its own integrated chip -- also called system-on-chip -- based on the Power architecture, said Dean McCarron, principal analyst at Mercury Research.
That development is tied to one of IBM's goals -- to push Power-based chips into more servers, which could prop up the company's other businesses, McCarron said. IBM also offers software, hardware and services tied to servers running on Power and x86 processors.
"IBM wanted to expand their business outside of their own products, pretty much going into a licensing play," McCarron said.
IBM is opening its Power architecture at a time when the business has been struggling. Its Power division reported a 25 percent decline in revenue last quarter, while the broader Systems and Technology Group saw revenue decline 12 percent.Against that backdrop, IBM is making some of its employees take a mandatory furlough at the end of August, an IBM spokesman confirmed Tuesday. The furlough affects workers in the STG group and its Integrated Supply Chain division, which handles areas like procurement and logistics. The employees will receive an equivalent of one-third pay, while executives will not be paid for that week, IBM said. It declined to say how many workers are affected.