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Is the Game Finally up for SGI? 182

Rob writes to mention a Computer Business Review article looking at the bankruptcy of SGI, and whether the company is planning on a comeback. CEO Dennis McKenna is emphatic that the company isn't just looking for an exit strategy, but it's hard to see where they could go from here. From the article: "SGI has more challenges ahead, and I still find it hard to believe that after all of the chances it has had to run a profitable server and visualization business in the past it can miraculously do so now, selling lower-end boxes on even slimmer margins. But I'm hoping that the Chapter 11 has provided the necessary wake-up call for the company to get really lean really fast, because only from a more stable financial footing does it have any hope of fighting its way back onto new technology buyers' wish-lists."
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Is the Game Finally up for SGI?

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  • by also-rr ( 980579 ) on Tuesday July 18, 2006 @12:52PM (#15737651) Homepage
    ...the Nothing for you to see here. Please move along. error seems oddly appropriate.

    We used to use SGI for everything related to virtual worlds... and carried on doing so when they moved to NT. About 6 months later someone noticed that we could swap expensive SGI boxes for cheap white boxes and save a fortune, then migrate all the legacy code without much pain to RedHat... and that was the end of SGI for us.

    I do have a very nice SGI Indigo foot rest however.
  • Re:SGI Video cards (Score:3, Informative)

    by also-rr ( 980579 ) on Tuesday July 18, 2006 @12:55PM (#15737674) Homepage
    You would think that the SGI name has enough high end appeal that nVidia or ATI would want to market SGI branded video cards.

    For some time now SGI have been using ATI cards to power their machines - even on the high end [com.com]. How much more prestiege there is to be gained, especially for nVidia who weren't picked, I don't know.
  • Re:not really (Score:3, Informative)

    by cyngus ( 753668 ) on Tuesday July 18, 2006 @01:24PM (#15737898)
    Well, no, its usually the way of flipping the bird to the shareholders while bending over for the creditors. Often the pre-bankruptcy shareholders are left with nothing and the debt is converted to equity and the previous debt holders own most of the company.
  • by j0eshm0e ( 720044 ) on Tuesday July 18, 2006 @01:44PM (#15738098)
    About three years ago when I was buying a PC that would become my fileserver, I looked into buying an SGI box. I wanted something different than a white box to experiment with. I tried to find a vendor in the Ottawa area and couldn't. I tried to buy one online and couldn't. I sent SGI a message on their 'contact us' webpage about buying a SGI machine and got no response.

    With a sales response like that, it is no wonder they are having trouble. I sincerely hope they find a way out of bankruptcy --they have a hell of an filesystem in XFS-- but they NEED to make it easier to purchase their equipment.
  • by cweber ( 34166 ) <cwebersd@@@gmail...com> on Tuesday July 18, 2006 @02:18PM (#15738384)
    Interesting analysis, and I have to agree to an extent. I am a Unix nerd (scientific computing) and have been an SGI customer for most of the 90s. Then commodity hardware running Linux became fast enough and had enough graphics horsepower that a switch was a nobrainer, as you say.

    However, I switched away from Linux PCs on the desktop, and so have many other Unix-centered scientists, and we now use Apple computers. True, most of us like for the computer to Stay Out Of The Way, but most of us still like to be smart about computers. We just got tired of having to put the same pieces together over and over again. In today's world we can focus on getting work done, whether that be heavy duty simulations, visualization, searching databases or the web, writing up results in off the shelf office software, or prepring the next seminar in standard slideware. All at the same time, and without funny glitches. However, should Apple ever misstep we would move away in a heartbeat, unlike traditional Mac users.

    On the HPC side it's much the same. We still have an SGI Altix system which can't be beat in terms of scalability of our main applications, but we have 10x as many x86-64 CPUs in a dumb cluster for the simpler 'gotta get 10,000 of these calculations done' jobs. Vendor and even Linux distro don't matter at all, we buy whatever works and comes cheap enough. Very different from the old days when we benchmarked half a dozen vendors' proprietary Unix systems for several months before settling on one, and then spent several more months in 'friendly user mode'.
  • by Animats ( 122034 ) on Tuesday July 18, 2006 @02:46PM (#15738628) Homepage

    Gee, I had my Slashdot article on the SGI bankruptcy rejected back on May 8th when it actually happened. Two months later, the bankruptcy gets a mention on Slashdot.

    SGI's main remaining business is real estate. They own many buildings in Mountain View, most of which they lease to Google. [sgi.com] Due to some bad decisions (like signing up for a 55-year land lease in 1995) SGI loses money on that deal. Then they tried a sale/leaseback deal with Goldman Sachs and dug themselves a bigger hole by locking in their rent at the top of the dot-com boom. A friend at Google says that SGI is a "great landlord", though.

    SGI doesn't really have much left in the way of manufacturing facilities. The only thing left is Chippewa Falls, the old Cray facility. They had 1,858 employees left at the start of the bankruptcy. SGI had way too much legacy administrative overhead. They had 18 different corporate entities, from Cray to MIPS to Parallel to Alias/Wavefront, and 43 more marketing subsidiaries in various countries. Most of those organizations will disappear in the bankruptcy.

    From the filing: In the last several years, SGI has faced a number of challenges, which, taken together, have had a negative impact on SGI's overall financial performance. In the late 1990's, SGI made a series of investments in strategies and technologies that yielded less than the expected results.

    Er, right.

    Realistically, what happened is that SGI was totally unable to cope with their high-margin business becoming a low-margin business. Few companies succeed at that transition, IBM being a notable exception. And even IBM finally bailed out of PCs.

  • Re:Graphics Silicon (Score:3, Informative)

    by itomato ( 91092 ) on Tuesday July 18, 2006 @02:52PM (#15738679)
    Silicon Graphics 'graphics' engineers are now nVidia.

    Commodity PC hardware ain't gonna cut it.

    http://www.s3graphics.com/en/index.jsp [s3graphics.com]
    http://www.matrox.com/ [matrox.com]
    http://www.tridentmicro.com/ [tridentmicro.com]

    have died at the hands of
    http://www.leadtek.com/ [leadtek.com] (foxconn)
    http://www.nvidia.com/ [nvidia.com]
    http://www.ati.com/ [ati.com]

    SGI's fu is weak besides..
  • by Anonymous Coward on Tuesday July 18, 2006 @03:01PM (#15738736)
    They basicially had this with the SGI Prism deskside units that they just EOL'd. It was basicially a 2 way Itanium2 box with one or two higher-end ATI FireGL cards. Problem was it was expensive for a desktop (8-30K), you had to have Linux/ia64 applications, and the Itanium was a dog for integer ops. You could get equivalent floating-point performance with a x86 (or 64) based Opteron or Xeon platform, and the current video card market with it's six-month product cycle soon eclipsed the FGL card (to certify a card to work with an enterprise platform takes time that a consumer-level card doesn't require).

    The nice thing about this architecture was that you could scale it up to work with their Altix platforms; so you could have a system with 16 graphic cards, 256 processors and a terabyte of RAM in a single system running the same software environment. But who needs that? There are only a few dozen facilities nationwide that have an application that requires that much hardware.

    A short summary: the low end was too expensive and the high end was an answer to a question that not enough people were asking.
  • Re:Graphics Silicon (Score:3, Informative)

    by Doc Ruby ( 173196 ) on Tuesday July 18, 2006 @03:26PM (#15738900) Homepage Journal
    It turns out [slashdot.org] that SGI's "graphics card" staff did go to ATI and nVidia. But the industry didn't develop quite like that: ATI [wikipedia.org] was founded in 1985, nVidia [wikipedia.org] in 1993.
  • by parabyte ( 61793 ) on Tuesday July 18, 2006 @07:28PM (#15740330) Homepage
    It is too late. SGI missed the boat around 1997, when they made some fatal business decisions:
    • they "joined" forces with Microsoft in project Fahrenheit [wikipedia.org], resulting in giving away 3D-API know to Microsoft and making DirectX a competitive 3D API
    • they did not have the guts to cannibalize their business by building a low-cost 3D graphics card for the PC - we have been waiting for it after they did it for the Nintendo N64
    • they bought Cray, completely ruining the cost structure because their engineers had much higher wages than their own staff
    • they did stick too long to the MIPS architecture, loosing a competitive price/performance ratio
    • they managed to loose their best engineers to all kinds of successful new companies, probably because of a mixture of lack of success and lack of innovation in leadership

    Maybe if they just had managed to avoid one or two of above mistakes, they might have not got where they are today.

    p.

  • by edwdig ( 47888 ) on Tuesday July 18, 2006 @09:32PM (#15740829)
    An NVidia Quadro card isn't very different from a GeForce card. The biggest difference is the drivers are optimized for visual accuracy, whereas the GeForce drivers will take shortcuts to improve the frame rate.

    If you go for something like a Wildcat card, the cards tend to focus on raw numbers of polygons more than on effects (although they've been improving in those aspects in recent years). A few years ago I worked in a department that did Computational Fluid Dynamics. The results came out as a mesh with lots of data points at each mesh point. We'd view the results in 3D by just adding shading to the models. The points would be given a color on a red to blue scale (think weather charts) with the graphics card interpolating the colors along the polygon surface. We compared a then high end Quadro card with a 2 year old Wildcat card. The Wildcat completely blew away the Quadro in performance.

    Also of note, the graphics cards in the then 5 year old SGI workstations seemed to hold their own against the Quadro card. I don't remember which was faster, but they were close enough in performance that you didn't really notice a difference unless you were looking for it.

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