An interview with Tyan president and CEO,
Monday 26 July 2004
Tyan Computer Corporation showed its latest Intel and AMD server and
workstation offerings at Computex Taipei, 2004.
An interview with Tyan’s president and CEO, Symon Chang and his special
assistant Steve Hsia about the company’s plan to become one of the premier
white box providers for all levels of systems for the enterprise.
Tyan’s present direction
Q: What is Tyan’s focus, right now?
Chang: Tyan is very active in the workstation OEM/ODM market, with a focus on
channel sales. By highlighting white box offerings in the server market, Tyan
is looking to be a solutions provider for large systems integrators. We may
appear very active in Opteron business, promoting many new Opteron-based
systems; however, our primary business remains Intel-based machines.
If I were to put a number on it, I would say two-thirds of the company’s
business is from Intel-based products.
Q: Where is Tyan going with its server offerings?
Are you looking at the high end or low end of the market?
How are you managing to maintain a high-level reputation for your products?
Chang: That is more of a branding issue, and we are not a brand name.
We do not want to compete with IBM, Dell or the other large system
integrators. We want to be their main supplier.
When you open up one of their machines, we want you to see a Tyan board.
Nevertheless, when it comes to large custom-made clusters, we will compete in
that area because the larger labs don’t want to buy from the mainstream
system integrators. As well, IBM does not want to bother selling to the large
labs. Someday, we will make larger offerings for that market, but the large
clustering market is really a small niche.
Q: Currently, companies such as IBM are moving from being hardware providers
only to Systems Integrators. Does Tyan have any plans to enter this market?
Chang: There are two channels in which to sell server offerings; the first is
to the distributors and resellers. For example, customers like Ingram Micro
and Arrow buy barebone systems. We sell them a white box, and they will
install their own software and resell it to the end customer. The second is
to sell directly to the system integrators and the companies providing
clustered supercomputing for budget minded operations. These companies create
value with their mechanical solutions, with power distribution for example.
Many companies, including Linux Networks and RackSaver, supply computers for
the gas and oil industry. We also had a systems integrator who installed a
super cluster for the Los Alamos National Laboratory in the United States.
Q: What do you see as the demand drivers for servers over the next couple of
years? We’ve recently spoken to memory makers who have lamented that demand
for DRAM in the server market has not lived up to expectations. They are
hoping for a pick-up in demand for server memory. As applications such as
VoIP begin to mature, do you see the demand for memory in the server industry
starting to grow exponentially?
Chang: Naturally, as the industry migrates to new operating systems, demand
for additional memory will increase. Right now, under Windows XP, you need to
have 256MB to 512MB of DRAM to operate comfortably and without latency.
With new 64-bit operating systems coming out, though, you’re going to see a
noticeable increase. At a minimum, the requirements will double, and
realistically, will be even higher. When the desktop memory requirements
finally go to 2-4GB of memory (I’m not sure when that will actually happen),
that is when you’ll see the majority of users moving to a 64-bit platform.
At that time, memory requirements will need to to increase, for both the
workstation and server markets. If I were to hazard a guess, I would say that
within two years, 2GB will become the new industry standard for the basic
amount of DRAM required for smooth system operation. Gamers, of course,
always go for larger amounts of memory; for gamers, no amount is too high, as
long as they can afford it.
Hsia: For the server market, the PCI Express bus is a revolutionary change
from the current computing platform. It allows companies like Tyan to be more
flexible in making both servers and workstations.
The first generation can run at 4x, allowing customers to upgrade to 8x or
16x when they are ready.
In addition, when the card manufacturers come to market with a brand new
product, they will have greater flexibility with bus speed, allowing cards to
be upgraded effortlessly. Currently, speed upgrades are totally bus
dependent, so PCI Express is really fresh for our industry, as well as for
the desktop. We have much to look forward to.
Q: From a corporate perspective, can you say something about how plans have
changed over the last few years, and how you see them developing in the next
several years? Could you tell us something about Tyan’s relationship with
Mitac, as well as Tyan’s IPO, and how you will be funding expansion and
Chang: Well, we have really worked well with departments within Mitac, on a
variety of OEM projects, utilizing Mitac facilities for the manufacturing.
We moved our headquarters to Taiwan because our manufacturing is here.
Being here allows us to better consolidate our development. Taiwan is our
financial and logistics center. Our research and development in Taiwan and
Shanghai will now be our main centers, although we will continue to maintain
our advanced development centers in the United States.
Q: From a funding point of view, are you looking to attract funds?
Chang: No, we’re doing fine on the financial end of the business, and our IPO
is mainly for the employees.
Future computing and software
The conversation turned to Dr. Chang’s views of the future direction of
computing over the next few years and how operating systems can affect demand.
Q: Do you see 64-bit computing as the future for servers? How about operating
system support? In which direction is Tyan heading?
Chang: I think so. The primary reason for this is that most modern servers
require a large amount of memory, and if they need to go over 4GB, a 64-bit
solution is really the only way to address that issue. The Linux business in
64-bit is pretty far along, but Windows will take a little time. Primarily,
64-bit is already the de facto standard in the Linux RISC PC business, and
probably in some selective workstation markets, but not in the generic
Q: Do you think that PCI Express will drive demand?
Hsia: I think that a lot of things will go hand-in-hand. For example, in the
next year or two when Microsoft’s new Windows OS, Longhorn, is officially
announced, you’ll definitely see a big spike in the adoption of PCI Express
based products. Between now and then, it’s really just a waiting period. 2006
is really going to be a big year for computing, and we will see some dramatic
changes in the way computers and systems are made.
Q: Do you think, as we get closer to Longhorn, that sales will drop off, with
people growing tired of the wait?
Hsia: I don’t believe so! Now, in the HPC (high-performance computing)
market, most of our customers are using Linux, and as Linux’s clustering
capabilities mature and improve, we believe the uptake will stay steady.
Q: Do you think Microsoft’s 64-bit OS will come out on time?
Chang: I hope so. There are delays, but I believe it will. Interestingly
enough, a couple of significant things have happened this year; for example,
Intel’s Xeon processor with 64-bit extensions is a reaction to the unexpected
popularity of AMD’s Opteron, w