New Year’s Foreboding

By Michael Feldman

January 7, 2009

As is usual for the supercomputing world in early January, news is hard to come by. With so many academics in the community, a lot of HPC practitioners are still on their extended winter breaks. As for commercial HPC companies, they may not be so eager to return to work to confront the new economic realities they’ll be facing in 2009.

With the recession in full swing, the most likely news for HPC vendors may be bad news. Layoffs, mergers and other forms of retrenchment may end up being standard operating procedure for these organizations in 2009. Even though HPC-related businesses are expected to be spared the worst of the recession, that doesn’t mean there won’t be consequences. In fact, some of the effects of the downturn are already in evidence.

At the end of 2008, Cray executed a Goodwill write-down of about $55.4 million because the company’s stock price fell below its net assets. Even though Cray was able to book $100 million in Q4 as a result of the official acceptance of the new Jaguar petaflop system by Oak Ridge National Lab, the non-cash write-down meant that the company still suffered a net loss for 2008.

Cray’s stock was not the only one tanking. Practically every public IT company with (or without) an HPC stake rode the steep market decline that began in September last year. By the end of 2008, stocks of IBM, HP, Sun Microsystems, SGI Dell, Microsoft, Mellanox, Voltaire and ANSYS reflected the general market sell-off that occurred in the fourth quarter; most losing one-third of their value or more.

Stocks of chipmakers Intel, AMD, NVIDIA and Xilinx followed a similar pattern. The semiconductor industry, in general, is in for a rough ride this year. According to BusinessWeek, the global semiconductor industry is going to be hit hard by reduced demand for chips worldwide, just as production capacity is peaking.

The extent of the recession’s effect on the HPC market is going to be the big question in 2009. A lot depends on how governments around the world react to the financial turmoil. Pumping up R&D and industrial users of HPC would help maintain demand, but with so many sectors in trouble, even all the government stimulus packages being considered in the big industrialized nations will be unable to cover everyone.

In particular, the financial services sector is likely to consolidate, regardless of bailouts or stimulus spending, although this may not translate into reduced HPC spending. According to a recent survey of IT professionals at tier-one banks, HPC investments will grow in 2009. This probably reflects the view that IT spending, in general, makes sense in practically all economic climates, since it helps increase worker productivity. In good times this translates into larger revenues; in bad times it means workers can be replaced with technology.

Other major HPC sectors should be able to weather the economic downturn fairly well, too. Flush with cash, oil and gas companies are not in any immediate trouble, although the lower demand (and prices) for hydrocarbon fuels will inhibit some seismic exploration ventures, at least in the near term. Likewise, biotech companies that have plenty of cash on hand should also be able navigate through the recession, although startups may starve for funds because of the lack of investor capital and the tight credit market.

Where governments can help most is getting the overall economy back on track and making some key investments. In the U.S., President-Elect’s Obama’s plans for a government stimulus package are still being drawn up this month. More than half of the nearly $800 billion proposed will go towards tax relief, which will do little to spur computing demand. But the remainder is to be spent on programs, including infrastructure build-out and energy research and development — both of which could entail new HPC activity, albeit not immediately.

Obama and the Democratic Congress are also likely to fulfill their commitment to double federal funding of basic research over 10 years and make the R&D tax credit for corporations permanent. Since this entails only a few billion dollars per year, there probably won’t be a lot of opposition to this type of spending, especially when seen against a backdrop of trillion dollar per year deficit spending.

The real problem is at the state level, where, according to the Center on Policy and Budget Priorities, the cumulative budget shortfall will be $89 billion in 2009, ballooning to $145 billion in 2010 and $180 billion in 2011. If the stimulus package doesn’t cover shortfalls at the state level and the feds don’t step in with extra money, university and other state-sponsored R&D funding could face severe cutbacks. The governor of Wyoming has already made up a $1 billion wish list for Obama to rescue his state’s projects, including $50 million for a supercomputer at the University of Wyoming. Other states are sure to start lining up for federal funds.

HPC users are understandably wary. In a poll taken by Douglas Eadline at Linux Magazine in December, 40 percent of the 42 respondents said the economic downturn would not effect their HPC budget plans for 2009. Eadline suggests those are pretty good numbers, considering the rest of the IT industry appears to be headed for a more severe downturn. John West, at insideHPC, adds his two cents on the topic, noting that HPC use is precariously balanced on the backs of the HPC providers:

HPC vendors are experiencing economic disruptions because razor thin margins and little access to working capital mean they are hypersensitive to even small changes in the market. But they could stabilize where they are now and slowly return back to the “critical, but stable” state they’ve declined into over the past decade. However, if the disruption pushes into the HPC provider community — the labs and departments that provide HPC cycles and expertise to users — and we see a large scale reduction in employment and acquisition, then I think we’ll be in for a wholesale restructuring of the HPC market.

The open question is whether the downturn will be resolved in the next four quarters. Because of the long intervals between budget planning, procurement and deployment, it’s quite possible that any trouble exposed in 2009 will only be a prelude to deeper problems in 2010 and beyond. But if the recession is basically over by the end of this year, the hangover should be relatively mild. Otherwise, HPC growth is likely to take a much lower trajectory for the foreseeable future.

Subscribe to HPCwire's Weekly Update!

Be the most informed person in the room! Stay ahead of the tech trends with industy updates delivered to you every week!

US Exascale Computing Update with Paul Messina

December 8, 2016

Around the world, efforts are ramping up to cross the next major computing threshold with machines that are 50-100x more performant than today’s fastest number crunchers.  Read more…

By Tiffany Trader

Weekly Twitter Roundup (Dec. 8, 2016)

December 8, 2016

Here at HPCwire, we aim to keep the HPC community apprised of the most relevant and interesting news items that get tweeted throughout the week. Read more…

By Thomas Ayres

Qualcomm Targets Intel Datacenter Dominance with 10nm ARM-based Server Chip

December 8, 2016

Claiming no less than a reshaping of the future of Intel-dominated datacenter computing, Qualcomm Technologies, the market leader in smartphone chips, announced the forthcoming availability of what it says is the world’s first 10nm processor for servers, based on ARM Holding’s chip designs. Read more…

By Doug Black

Which Schools Produce the Top Coders in the World?

December 8, 2016

Ever wonder which universities worldwide produce the best coders? The answers may surprise you, at least as judged by the results of a competition posted yesterday on the HackerRank blog. Read more…

By John Russell

Enlisting Deep Learning in the War on Cancer

December 7, 2016

Sometime in Q2 2017 the first ‘results’ of the Joint Design of Advanced Computing Solutions for Cancer (JDACS4C) will become publicly available according to Rick Stevens. He leads one of three JDACS4C pilot projects pressing deep learning (DL) into service in the War on Cancer. The pilots, supported in part by DOE exascale funding, not only seek to do good by advancing cancer research and therapy but also to advance deep learning capabilities and infrastructure with an eye towards eventual use on exascale machines. Read more…

By John Russell

DDN Enables 50TB/Day Trans-Pacific Data Transfer for Yahoo Japan

December 6, 2016

Transferring data from one data center to another in search of lower regional energy costs isn’t a new concept, but Yahoo Japan is putting the idea into transcontinental effect with a system that transfers 50TB of data a day from Japan to the U.S., where electricity costs a quarter of the rates in Japan. Read more…

By Doug Black

Infographic Highlights Career of Admiral Grace Murray Hopper

December 5, 2016

Dr. Grace Murray Hopper (December 9, 1906 – January 1, 1992) was an early pioneer of computer science and one of the most famous women achievers in a field dominated by men. Read more…

By Staff

Ganthier, Turkel on the Dell EMC Road Ahead

December 5, 2016

Who is Dell EMC and why should you care? Glad you asked is Jim Ganthier’s quick response. Ganthier is SVP for validated solutions and high performance computing for the new (even bigger) technology giant Dell EMC following Dell’s acquisition of EMC in September. In this case, says Ganthier, the blending of the two companies is a 1+1 = 5 proposition. Not bad math if you can pull it off. Read more…

By John Russell

US Exascale Computing Update with Paul Messina

December 8, 2016

Around the world, efforts are ramping up to cross the next major computing threshold with machines that are 50-100x more performant than today’s fastest number crunchers.  Read more…

By Tiffany Trader

Enlisting Deep Learning in the War on Cancer

December 7, 2016

Sometime in Q2 2017 the first ‘results’ of the Joint Design of Advanced Computing Solutions for Cancer (JDACS4C) will become publicly available according to Rick Stevens. He leads one of three JDACS4C pilot projects pressing deep learning (DL) into service in the War on Cancer. The pilots, supported in part by DOE exascale funding, not only seek to do good by advancing cancer research and therapy but also to advance deep learning capabilities and infrastructure with an eye towards eventual use on exascale machines. Read more…

By John Russell

Ganthier, Turkel on the Dell EMC Road Ahead

December 5, 2016

Who is Dell EMC and why should you care? Glad you asked is Jim Ganthier’s quick response. Ganthier is SVP for validated solutions and high performance computing for the new (even bigger) technology giant Dell EMC following Dell’s acquisition of EMC in September. In this case, says Ganthier, the blending of the two companies is a 1+1 = 5 proposition. Not bad math if you can pull it off. Read more…

By John Russell

AWS Launches Massive 100 Petabyte ‘Sneakernet’

December 1, 2016

Amazon Web Services now offers a way to move data into its cloud by the truckload. Read more…

By Tiffany Trader

Lighting up Aurora: Behind the Scenes at the Creation of the DOE’s Upcoming 200 Petaflops Supercomputer

December 1, 2016

In April 2015, U.S. Department of Energy Undersecretary Franklin Orr announced that Intel would be the prime contractor for Aurora: Read more…

By Jan Rowell

Seagate-led SAGE Project Delivers Update on Exascale Goals

November 29, 2016

Roughly a year and a half after its launch, the SAGE exascale storage project led by Seagate has delivered a substantive interim report – Data Storage for Extreme Scale. Read more…

By John Russell

Nvidia Sees Bright Future for AI Supercomputing

November 23, 2016

Graphics chipmaker Nvidia made a strong showing at SC16 in Salt Lake City last week. Read more…

By Tiffany Trader

HPE-SGI to Tackle Exascale and Enterprise Targets

November 22, 2016

At first blush, and maybe second blush too, Hewlett Packard Enterprise’s (HPE) purchase of SGI seems like an unambiguous win-win. SGI’s advanced shared memory technology, its popular UV product line (Hanna), deep vertical market expertise, and services-led go-to-market capability all give HPE a leg up in its drive to remake itself. Bear in mind HPE came into existence just a year ago with the split of Hewlett-Packard. The computer landscape, including HPC, is shifting with still unclear consequences. One wonders who’s next on the deal block following Dell’s recent merger with EMC. Read more…

By John Russell

Why 2016 Is the Most Important Year in HPC in Over Two Decades

August 23, 2016

In 1994, two NASA employees connected 16 commodity workstations together using a standard Ethernet LAN and installed open-source message passing software that allowed their number-crunching scientific application to run on the whole “cluster” of machines as if it were a single entity. Read more…

By Vincent Natoli, Stone Ridge Technology

IBM Advances Against x86 with Power9

August 30, 2016

After offering OpenPower Summit attendees a limited preview in April, IBM is unveiling further details of its next-gen CPU, Power9, which the tech mainstay is counting on to regain market share ceded to rival Intel. Read more…

By Tiffany Trader

AWS Beats Azure to K80 General Availability

September 30, 2016

Amazon Web Services has seeded its cloud with Nvidia Tesla K80 GPUs to meet the growing demand for accelerated computing across an increasingly-diverse range of workloads. The P2 instance family is a welcome addition for compute- and data-focused users who were growing frustrated with the performance limitations of Amazon's G2 instances, which are backed by three-year-old Nvidia GRID K520 graphics cards. Read more…

By Tiffany Trader

Think Fast – Is Neuromorphic Computing Set to Leap Forward?

August 15, 2016

Steadily advancing neuromorphic computing technology has created high expectations for this fundamentally different approach to computing. Read more…

By John Russell

The Exascale Computing Project Awards $39.8M to 22 Projects

September 7, 2016

The Department of Energy’s Exascale Computing Project (ECP) hit an important milestone today with the announcement of its first round of funding, moving the nation closer to its goal of reaching capable exascale computing by 2023. Read more…

By Tiffany Trader

ARM Unveils Scalable Vector Extension for HPC at Hot Chips

August 22, 2016

ARM and Fujitsu today announced a scalable vector extension (SVE) to the ARMv8-A architecture intended to enhance ARM capabilities in HPC workloads. Fujitsu is the lead silicon partner in the effort (so far) and will use ARM with SVE technology in its post K computer, Japan’s next flagship supercomputer planned for the 2020 timeframe. This is an important incremental step for ARM, which seeks to push more aggressively into mainstream and HPC server markets. Read more…

By John Russell

IBM Debuts Power8 Chip with NVLink and Three New Systems

September 8, 2016

Not long after revealing more details about its next-gen Power9 chip due in 2017, IBM today rolled out three new Power8-based Linux servers and a new version of its Power8 chip featuring Nvidia’s NVLink interconnect. Read more…

By John Russell

Vectors: How the Old Became New Again in Supercomputing

September 26, 2016

Vector instructions, once a powerful performance innovation of supercomputing in the 1970s and 1980s became an obsolete technology in the 1990s. But like the mythical phoenix bird, vector instructions have arisen from the ashes. Here is the history of a technology that went from new to old then back to new. Read more…

By Lynd Stringer

Leading Solution Providers

US, China Vie for Supercomputing Supremacy

November 14, 2016

The 48th edition of the TOP500 list is fresh off the presses and while there is no new number one system, as previously teased by China, there are a number of notable entrants from the US and around the world and significant trends to report on. Read more…

By Tiffany Trader

HPE Gobbles SGI for Larger Slice of $11B HPC Pie

August 11, 2016

Hewlett Packard Enterprise (HPE) announced today that it will acquire rival HPC server maker SGI for $7.75 per share, or about $275 million, inclusive of cash and debt. The deal ends the seven-year reprieve that kept the SGI banner flying after Rackable Systems purchased the bankrupt Silicon Graphics Inc. for $25 million in 2009 and assumed the SGI brand. Bringing SGI into its fold bolsters HPE's high-performance computing and data analytics capabilities and expands its position... Read more…

By Tiffany Trader

Intel Launches Silicon Photonics Chip, Previews Next-Gen Phi for AI

August 18, 2016

At the Intel Developer Forum, held in San Francisco this week, Intel Senior Vice President and General Manager Diane Bryant announced the launch of Intel's Silicon Photonics product line and teased a brand-new Phi product, codenamed "Knights Mill," aimed at machine learning workloads. Read more…

By Tiffany Trader

CPU Benchmarking: Haswell Versus POWER8

June 2, 2015

With OpenPOWER activity ramping up and IBM’s prominent role in the upcoming DOE machines Summit and Sierra, it’s a good time to look at how the IBM POWER CPU stacks up against the x86 Xeon Haswell CPU from Intel. Read more…

By Tiffany Trader

Beyond von Neumann, Neuromorphic Computing Steadily Advances

March 21, 2016

Neuromorphic computing – brain inspired computing – has long been a tantalizing goal. The human brain does with around 20 watts what supercomputers do with megawatts. And power consumption isn’t the only difference. Fundamentally, brains ‘think differently’ than the von Neumann architecture-based computers. While neuromorphic computing progress has been intriguing, it has still not proven very practical. Read more…

By John Russell

Dell EMC Engineers Strategy to Democratize HPC

September 29, 2016

The freshly minted Dell EMC division of Dell Technologies is on a mission to take HPC mainstream with a strategy that hinges on engineered solutions, beginning with a focus on three industry verticals: manufacturing, research and life sciences. "Unlike traditional HPC where everybody bought parts, assembled parts and ran the workloads and did iterative engineering, we want folks to focus on time to innovation and let us worry about the infrastructure," said Jim Ganthier, senior vice president, validated solutions organization at Dell EMC Converged Platforms Solution Division. Read more…

By Tiffany Trader

Container App ‘Singularity’ Eases Scientific Computing

October 20, 2016

HPC container platform Singularity is just six months out from its 1.0 release but already is making inroads across the HPC research landscape. It's in use at Lawrence Berkeley National Laboratory (LBNL), where Singularity founder Gregory Kurtzer has worked in the High Performance Computing Services (HPCS) group for 16 years. Read more…

By Tiffany Trader

Micron, Intel Prepare to Launch 3D XPoint Memory

August 16, 2016

Micron Technology used last week’s Flash Memory Summit to roll out its new line of 3D XPoint memory technology jointly developed with Intel while demonstrating the technology in solid-state drives. Micron claimed its Quantx line delivers PCI Express (PCIe) SSD performance with read latencies at less than 10 microseconds and writes at less than 20 microseconds. Read more…

By George Leopold

  • arrow
  • Click Here for More Headlines
  • arrow
Share This