SGI Sets Sights On Turnaround

grub wrote to us about an article about SGI, and its ongoing battles to turn its corporate fortunes around. The company's been doing interesting stuff for a long time - here's to hoping they stay around.

Comments

SGI was killed by it's greedy salesmen

[K8Fan]

I used to demo software for an SGI dealer, and learned to loath the company. The special hard drive mounting bracket for an Indy would cost more than the drive. The knob box cost $1500. Nutty prices.

But the thing that sealed their doom was when they didn't take the opportunity offered by Nintendo purchasing a huge number of R4000 chips. They could have taken the volumes offered by this to start selling MIPS chips to PC video card makers. They could have owned the entire video card market, and not suffered the brain drain that found all their best people working for competitors. Instead, their fat-cat sales force ruled against that move. They liked selling expensive workstations and servers to big clients for big bucks.

If they had played this card correctly, Nvidia would have never happened. Who wouldn't have wanted a "Silicon Graphics" game card? Instead, they were stupid greedy and they'll die. And they'll deserve to die.

Re:SGI was killed by it's greedy salesmen

[foobar104]

But the thing that sealed their doom was when they didn't take the opportunity offered by Nintendo purchasing a huge number of R4000 chips.

The Nintendo 64 was built around the MIPS R4300i embedded processor. It had limited R4000 instruction-set compatibility and a 64-bit execution unit, but it wasn't really related to the chips SGI used at the time at all.

So while selling tons more embedded processors would have been a nice bonus for SGI's MIPS subsidiary, it wouldn't have affected their core business on bit.

Re:No mention of linux

[Anonymous Coward]

What is SGI's relationship to linux, and why doesn't this article mention linux once?

I'm posting this anonymously because I don't wanna get in trouble in case any of this is confidential. I don't think it is, but you never know.

SGI's official relationship to Linux is this: none whatsoever. At one time, there were some pretty serious plans to port core OS libraries, build abstraction layers and shims, and phase out the IRIX kernel in favor of Linux. It was thought to be easier to turn Linux into a real commercial-quality kernel (not my words; don't flame me!) than to port 60-odd million lines of IRIX to the then-proposed IA-64-based Origin 3000 variant. These plans have been informally shelved, meaning SN-IA is still a product on the roadmap, but nobody is working on it. It seems to have been put in the "maybe after McKinley" category.

(Take all of this as unofficial comment, of course, but this paragraph is total speculation on my part. I wonder if part of the reason IA-64 isn't really going anywhere in this market is because of the lack of a really good Fortran compiler for it. The MIPSpro Fortran 77 compiler, which I've worked with a lot, kicks ass, and I understand the F90 one does as well. Getting all of that tuned, optimized Fortran code to run on IA-64s seems to be a challenge for a lot of folks that are long-time die-hard SGI customers.)

SGI is officially committed to continuing to develop and ship systems based on the MIPS processors (R12000, R14000, and the upcoming R16K, and R20K) with the IRIX OS until further notice, which is to say that they're not opposed to exploring other options, but there just isn't any reason to switch that plan right now. The Origin 3000 server is a great piece of work, and the new lower-end Origin 300 is selling nicely, too. On the workstation side, believe it or not the humble little O2 is still selling briskly-- now with R7000 or R12000 processors, painted purple, and called O2+. Octane2 kicks ass, and a new workstation to be announced in January or February is also going to be based on MIPS/IRIX, combining Octane2 graphics with Origin 3000-style architecture.

So the official story is MIPS/IRIX forever.

Unofficially, SGI loves Linux. Check out oss.sgi.com sometime to see what SGI is doing with respect to Linux specifically (XFS, kdb, bigmem, NUMA, STP, etc) and Open Source in general (GLX, Inventor, Performer, etc).

SGI still around?

[BWJones]

Other than its ability to run on cheap (price and often quality) hardware, I still don't understand SGI's movement to Linux. I guess that I am showing my ignorance here, but it seems to me that Apple and SGI are in similar situations right now in some respects. Both companies historically have relied on income from the hardware side of things while making a closed OS/hardware system that for each of their respective markets is very effective. The difference between Apple and SGI however is that SGI already has a UNIX OS with a GUI (however difficult it is to manage but VERY extensible and powerful), and Apple is developing UNIX with a GUI (easier to manage, more powerful in some respects, etc etc etc...). Both companies need major transitions to survive, but why Linux/Intel? IRIX is already mature, stable, fast, with great graphics capabilities and IO capabilities, so I ask again, why move to Linux and Intel?

Both companies obviously want to benefit from the open source paradigm while still remaining in business with proprietary OS's. (I am guessing here for SGI as I assume that they will make their OS on a proprietary linux model) The approach Apple is taking certainly makes sense to me by developing a UNIX OS that includes the opensource Darwin, but I am totally clueless as to what SGI is doing here. What makes Linux more attractive than simply continuing to develop IRIX and putting more effort into improving, simplifying some features, and pushing development for IRIX on perhaps less expensive hardware? (among other changes to their business model) Again it seems to me that SGI is making another crucial mistake here as the developers that have tapered off work for IRIX have not for the most part started developing for Linux (although I know of a few examples), primarily they have lost ground to Wintel. (thus
their misguided attempt at Wintel/SGI boxes I guess)

In short it appears that they are trying to make Linux/Intel into what they already have in IRIX/MIPS, only with cheaper hardware which seems awfully dangerous to me for both end users and the company.

I believe that by 2005 SGI will no longer be in the low to mid-range workstation market. This market will belong to perhaps Linux/Intel or OSX/PowerPC. Right now for what my maintenance contracts cost me for a single SGI Octane, I can purchase a new G4 WITH a 22in Cinema display YEARLY! This is not even talking about the $40k initial acquisition costs.

SGI will survive in the server market and high end visualization market if they are not acquired by someone else. After all SGI's market cap is only around 585 million last time I checked.

I just don't see a way for them to do it..

[jcr]

SGI is caught in the classic problem that killed DEC, and is killing Tandem, Stratus, DG, and many others: the performance of the lowend is improving so quickly that we can do things on $1K machines that used to require $1M machines.

I have a friend who had an idea that could have saved them. When he was at SGI, he pointed out that machines that were optimized for graphics had to have great I/O performance, which would also make them great performers in another I/O intensive task: running RDMS engines like Oracle and Sybase. SGI management wasn't interested.

So, SGI employees and stockholders lose out, and the rest of us gain another lesson in the dangers of rigid thinking.

-jcr

Re:I just don't see a way for them to do it..

[foobar104]

SGI is caught in the classic problem that killed DEC, and is killing Tandem, Stratus, DG, and many others: the performance of the lowend is improving so quickly that we can do things on $1K machines that used to require $1M machines.

In a way, you're right. Every day I deal with the fact that SGI computers aren't cost-effective for general purpose tasks like file serving or database applications.

But at the same time, you've pointed out the reason why SGI is trying to do what they're trying to do. Some tasks that could previously only be done on SGI workstations can now be done on cheap(er) PC-type computers. I'm thinking of 3D modeling and image exploitation specifically, but there are lots of other examples, too.

So okay, SGI needs to get out of the desktop workstation business except where they can justify it. So they're doing that.

But there are some tasks that you've never been able to do cost-effectively on a PC-type system. Like high-definition or film compositing and editing. Sure, you can do film-resolution work with After Effects or Final Cut Pro, but it'd be so slow that you couldn't turn a profit doing it. So instead you buy a half-million-dollar Onyx and go to sleep every night on a big pile of money.

Now, for the first time, there's a desktop workstation that's capable of doing most of what an Onyx can do: Octane2. So now SGI is going to a lot of those customers that have Onyxes and asking them if they'd like to buy three or four smaller systems that do 80% of what the Onyx can do to augment their existing stuff. And many of them are saying yes, because (and this is the key) they already know they can be profitable doing it.

Of course, when SGI pushes down too far into the market space, they tend to get spanked a little. If you're doing standard-definition video editing, or god forbid compressed, you can do most of what you need with an Avid or Final Cut Pro on a G4. So SGI loses a lot there.

The trick: find the sweet spot, where the market is broad enough that you have a lot of customers to call on but not so broad that you get beat on price-performance, and sit there.

At the other end of the spectrum, there's the really high end. The Grand Challenge type stuff, like the project that motivated ASCI Blue Mountain at Los Alamos. If you're going to try to simulate a nuclear explosion instead of just setting one off and watching the pretty colors, you're going to need a computer that is several hundred times bigger than anything that had ever been built before. So there's an opportunity there to sell some of your big iron to the government, and (more importantly) to fund some R&D that will then trickle down to your commercial products so you can get back to beating the competition on features instead of fighting over price.

So yeah, in a way you're right. The low end keeps getting better. But as it does, we keep thinking of things to do-- both commercially and in the sciences-- that the low end can't handle. It's like swimming in the ocean. The waves are moving under you, and if you just sit still you're going to get dunked. But if you swim in the right direction at the right speed you can stay at the crest of the wave. That's the trick: to stay on the crest of the technology wave.

Re:SGI

[foobar104]

SGI used to be a real innovator in the field of graphics. Now it seems like companies like ATI and Nvidia are actaully doing more for that field.

You know, that's the funny thing about SGI's graphics hardware. InfiniteReality graphics first came out in January, 1996. Since then, SGI has put the same graphics processors on a new system interface for the Onyx2, and tweaked some components in the system twice (called IR2 and IR3, even though the changes were very minor).

InfiniteReality--apart from having the coolest name of any graphics subsystem--has remained essentially unchanged since 1996. IR today has slightly faster geometry processors and much more TRAM than the original IR, but in every other way it is identical.

That's six year old technology, baby. And the rest of the world is just now starting to catch up.

Guess that's why SGI has been selling the same graphics hardware for all this time. Because they can.

Re:Market woes

[MrDelSarto]

SGI equipment is not and never was in the same ballpark as a $AU1200 PC. A Beowulf cluster of 1024 PC's is not the same as an Origin 3000 of 1024 processors. Read about ccNUMA.

In terms of desktop processing, the I/O bandwidth of an O2/Ocatane can not be compared to a PC. In essence, that's where they differ from a PC with a GeForce. That's not to mention the video/audio hardware that comes built in that is well integrated into IRIX and for the most part well documented.

In general, with SGI you get what you pay for.

SGI is a great company (I've worked there) that's built on a culture of doing cool things with technology. They just seem to have made a lot of bad decisions. They seem to be returning to their core business now, i hope it works -- how many quaters have then been going to turn a profit next quater now?

SGI and marketing, wow factor

[green pizza]

SGI has always had a hard time trying to market itself. They've typically made endless incorrect assumptions and end up preaching to the choir. And yet, the wow factor that made the company and it's little cube logo a legend in the late 1980s is still there, abeit in a slightly different manner.

True, not everyone needs 512 or 1024 CPUs running on a single system under a single kernel. Or 16 graphics pipelines. But there are those that do. Which is why, shortly after the introduction of the Origin 3000 two years ago, an entire convoy of the machines were sent to Fort Meade.

It's almost as though SGI has gotten used to the high end, as though their technology (HW, SW, APIs, SDKs) no longer impress themsleves. Nowhere else, not even E&S, can a person find a platform that can drive up to 128 display channels (16 pipes x 8 channels per pipe) with perfect sync, or even at all. O2K and O3K (and more recently, O300 and Octane2) can drive multiple displays from one or more graphics pipelines. Raw, per-CPU performance isn't anything to write home about, but the thruput and latencies are perfect for generating insane 3D and mixing it with streams of HDTV... or anything. Think of a way-cool use of video and 3D. Now increase the complexity and choose, oh, 4 camera viewpoints. Maybe an additional display for stats and another for an "operators station". Easy with O2K/O3K (aka "Onyx" when gfx are invloved). It can be done and it's proven. They've been doing this sort of thing since you and I were using our "cutting edge" unaccelerated 2D graphics cards running at an "insane" 1024x768.

A pair of old demos SGI likes to show off are sometimes called "from space to your face", in which over 500 GB of sat photo textures are shuffled thru one or more InfiniteReality graphics pipes to provide a realtime "bungie jump" from the moon to earth and back. INSANE. 60fps/60hz locked. 4 huge disk RAIDs composed of dozens of drives grinding away like mad to keep the textures coming. WILD STUFF. All in a day's work.

SGI isn't about buzzwords or about wizbang marketing. It's about providing modular solutions to some of the most challenging problems. They've been there to provide HW and SW to those wishing to work on the cutting edge. In 1988 they were selling 3D workstations. In 1991 folks were doing crazy 3D and video mixing. Today their hardware can be used to drive gobs of displays and to shuffle huge amounts of data. Sure, the desktop PC in 2007 will be able to do the same thing. By then, PCs will be able to drive gobs of high end gfx subsystems, and even a cheap graphics card won't sneeze at several GB of textures loading and unloading every second... but until then, for those that need this TODAY, there's SiliconGraphics.

Let's hope SGI is here tomorrow to show us even more cool things.

Re:Bali and Odyssey... *sigh*

[John Carmack]

>Cutting edge graphics, where did you go? Please tell me there's more to the 3D world than IR,
>WildCat II, and GeForce3. Has *nothing* (other than cost) really changed over the past five
>years? It's almost as though I haven't missed anything in the 28 months I've been away from 3D

Dependent texture reads are the only really new thing in the last year or two (and only really got worked out right in the Radeon 8500), but next year is going to see floating point pixel formats, which was going to be one of Bali's truly important points. We should also see highly scalable boards built on consumer chips, which has been promised for years, but (with the exception of some 3dfx high end systems) not delivered properly.

John Carmack