Just as Intel’s (NASDAQ: INTC) CEO Brian Krzanich opens the regular staff meetings before a dramatically reduced IDF2015 Shenzhen conference, it is a good time to review how government and enterprises don’t see eye to eye when it comes to strategic business.

China’s Tianhe-2 supercomputer is world’s fastest supercomputer, at 33 PFLOPS demonstrated and 55 PFLOPS theoretical performance.

Remember the Tianhe-2 machine at Guangzhou Supercomputer Center, the current World’s number one according to Top 500 Supercomputer list? Unlike some other China supercomputers – Tianhe-2 is fully Intel based machine,  the world’s largest assembly of Intel Xeon CPUs and Xeon Phi accelerators.

Even after Intel ‘opened the kimono’ and gave a nearly 70%  discount on its processors and accelerators, it has given Intel, and therefore US technology sector a major foothold in China and Asian region as such. Over the course of past two years, we were involved in a lot of discussions with Intel staff who were not privy to see the financial impact of the deal — and even argued our undoubtedly solid information. We’re not here to report how things should be, or are in marketing and investor presentations to its numerous staff, but how things really are.

During 2015, the Tianhe-2 supercomputer was supposed to be doubled in its size, up to 110 PFLOPs peak, again using the very same Intel processors and accelerators. Since now these are mature products with lower real manufacturing cost for Intel, they could finally make some real money.

Well, it was not to be: our tweety bird from the window chirped to us that Uncle Sam has put this supercomputer centre, together with National University of Defense Technology in Changsha, the system’s creators, and Tianjin centre, among others, on so a so-called “Denial List”, which prevents any high technology from the USA to be sold to these sites. Our sources used even harsher words.

Knowing that these several sites alone are expected to order some 250+ PFLOPS of compute in the next few years (around 500,000 top-end Broadwell-EP Xeon E5v4 processors, or  approximately $1 billion high margin list price) and they were THE Intel friendly ones, this is quite a loss to Intel, thanks to Uncle Sam.

But, what’s worse strategic loss in time is that, based on this decision as an excuse, indigenous China high end processor architectures can now push the government to gradually remove any dependence on US. This means just one thing: an AMD or Intel x86 processor technology is increasingly becoming errata non grata. Should the Chinese government react in force, it will give the Chinese vendors the blank check support to go all the way a developing their Alpha, POWER and MIPS processors for both the government and the mainstream commercial use.

You may think they are not up to the mark, but remember how fast British ARM architecture became the dominant processing architecture in the world. And this group doesn’t need to worry about the antiquated x86 ISA, worry about satisfying the dumbed down shareholder masses, or overpaying their marketing and sales staff, as well as the fat check, golden parachute-protected CxOs.

They have taken the best that the USA has developed (some of key Alpha, GPGPU and MIPS architects left US over the course of past four years, a lot of them due to non-renewed visas) and discarded due to corporate shenanigans, and the continued developing it much farther than anyone expected both on hardware and software side.

Five years ago, ShenWei showed a CPU that performed faster than the fastest GPUs of the time. Now, fifth generation is approaching, slotting between Tesla and FirePro GPGPUs and next-gen Xeon Phi accelerators. However, this is not an accelerator or a GPGPU – this is a CPU.

So, thanks to Uncle Sam, China might not have a 110 PFLOPS Intel based supercomputer but it definitely will launch a 100 PFLOPS system based on upcoming 64-core, TFLOPS-class ShenWei Alpha, with true blue CPUs possibly faster per socket then even the next generation Xeon Phi or Volta/Pascal-based Teslas.  Next, of course 100 PFLOPS Chinese POWER8 or 9 — (thank you IBM) and then possibly even Loongson MIPS – -it may come back into the high end field with renewed government support because of this Uncle Sam move. All are clean, elegant, scalable high end RISC architectures.

So who are the winners and losers from this?

NUDT and Tianhe may be the losers for now, but only short term. They will simply speed up their HPC ARM plan.

Intel comes out the big loser from this and a lot: who will want to do a phased deployment large x86 machine in China now, and worry about future phases? Then comes Uncle Sam himself: they lost even that little bit of influence on the high end China HPC. How is that for “cutting your nose to spite your face?”.

VR WORLD’s  Analysis: US government moves accelerate the Chinese CPU roadmap while curtailing juiciest sales for Intel and other US vendors.

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Ever since the announcement of the OpenPower Foundation (or consortium) there has been a lot of wondering about whether or not IBM would actually make something of it. After all, IBM’s market share in servers nowadays is fairly low compared to Intel’s and Intel has pretty much dominated the server market for the past 10 years. So, many saw IBM’s move to create the OpenPower Foundation as a desperate move to make something of their new Power8 processor technology and to broaden their market share at any cost. However, companies have been slowly joining IBM’s OpenPower Foundation and their movement has gotten quite some important companies to join in addition to the original founding members in Nvidia, Tyan, Mellanox and Google.

Since September of last year, OpenPower has added Altera, Samsung, Micron, Hitachi, Inspur, Teamsun, Verisilicon, ZTE, Fusion-IO, SKHynix and Xilinx. What this means is that OpenPower is growing, and its growing really fast and that spells trouble for Intel because OpenPower means that companies can utilize IBM’s incredibly powerful Power8 architecture and Power ISA without spending anywhere near the money they would if they simply bought into Intel’s ecosystem and paid thousands of dollars for Intel’s Xeon E5 and Xeon E7 x86 CPUs. Intel is the market leader and they know it, so they charge prices that make leaving Intel incredibly attractive whenever an opportunity presents itself. So, naturally, companies like Google and Facebook that have their own server farms and have hundreds of thousands if not millions of severs around the word are going to want to look for ways to boost performance and reduce cost. So, this week, Google showed off their own motherboard (probably manufactured for them by Foxconn) that utilizes two Power8 processors to power a server, effectively cutting Intel out of Google’s future server plans.

In a statement on Google+, Gordon McKean of Google talked about this new board that Google has developed and is showing off at the OpenPower booth at the IBM IMPACT 2014 conference. Obviously this statement was meant to be a significant one as this was Gordon’s first and last post on Google+ and it makes a pretty significant statement about Google porting over to Power8 from x86.

Today I’m excited to show off a Google POWER8 server motherboard in the OpenPOWER booth at the Impact 2014 conference in Las Vegas.  We’re always looking to deliver the highest quality of service for our users, and so we built this server to port our software stack to POWER (which turned out to be easier than expected, thanks in part to the liitle-endian support in P8). A real server platform is also critical for detailed performance measurements and continuous optimizations, and to integrate and test the ongoing advances that become available through OpenPOWER and the extended OpenPOWER community. (Google, IBM and others formed the OpenPOWER Foundation, a non-profit organization dedicated to developing an open ecosystem.)

Clearly, Google and IBM are making progress with their OpenPower Foundation and companies like Intel should be watching them very closely because they have everything that they need from all of the key companies to be able to turn this OpenPower Foundation into something seriously competitive with Intel. Ironically, though, companies like Mellanox are very closely allied with Intel, but are still members of OpenPower because in the end, their technology is really processor agnostic and if they can sell more interconnects, why not? If you look closely at the board, you can see that Google intentionally blacked out a lot of the ICs on the board, which isn’t very open of them, but is probably done in order to keep their platform safe from prying eyes until it starts being deployed on a broad scale.

A Google built IBM Power8 Motherboard

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