"A long time ago, in an economy far, far away, computer manufacturer Silicon Graphics Inc. was a powerful force.
Hollywood studios courted its executives. They spent hundreds of millions of dollars on the company's colorful and whimsically named machines - "Indigo," "Crimson" and "Onyx," among others. [...] Not anymore. Consumed by its own ambition and wounded by the surging popularity of the free Linux operating system, SGI has lost its star power in Hollywood." Read the article at NewsObserver by P.J. Huffstutter.
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Like always, quality stuff, pity doesn't get the attention it deserves.
"..the company whose machines gave birth to the dinosaurs in "Jurassic Park" is fighting to avoid its own extinction"
SGI machines are being replaced in research environments as well. In our own lab, most people prefer working with PCs running linux than the SGI machines except for some software that is SGI-only.
The signs were already obvious when they started making x86 machines. The interesting thing is that it happened so fast and they never had the time to recover at all, with big outfits like ILM and Pixar doing almost all of their jobs in Linux clusters.
While you can still get Fuel and Octane 2 workstations, the changes seem more of cosmetic rather than performance oriented. The Altix line looks great, but will Holywood come? I don't think so. Not with hardware getting so cheap along with a rock solid OS that doesn't cost them a lot. Sure the Altix runs on 64-bit linux, but the buyers will determine if SGI still has a future to look forward too.
Sheesh. If "any number of off-the-shelf PCs, armed with Linux software, can do the same job." then they're going to have to do a lot better than "$30,000 to $1 million each".
So why is SGI experiencing this? Probably this is a good expanation:
http://www.businessweek.com/magazine/toc/03_09/B382203linux.htm
SGI's death warrant was signed in 1994 when the first PC 3D accelerators appeared, and the knife was stuck in in 1996 when Intel introduced the Pentium Pro, the first x86 chip to really compete with the RISC CPUs. Since then it's all been downhill, not helped by a draining of the best 3D hardware talent to the likes of Nvidia, ATI and 3Dlabs.
Once the dog-eat-dog world of the PC market starts nibbling away at you there's not a lot you can do except try to embrace it and find a little niche to stay alive in, unless you're one of these behemoths like IBM or HP that has their hand in everything. In all honesty I think SGI has done a pretty good job of trying to find their niche and hold on tight while the PC avalanche goes past them. They might yet beat the grim reaper.
Linux has accelerated the process by making it easy for studios to switch from IRIX, but it would have happened with Windows if Linux wasn't around, it would just have taken longer. The price/performance ratio of PCs is just too good (even with the Microsoft tax) to pass up when performance is absolutely err... Paramount like it is with 3D animation.
Everyone's talking about 64-bit processors in every article nowadays. Yet SGI have had 64-bit MIPS processors since the mid-nineties. Why not put them to use instead?
" Everyone's talking about 64-bit processors in every article nowadays. Yet SGI have had 64-bit MIPS processors since the mid-nineties. Why not put them to use instead? "
Because back in those days SGI's were very expensive, even tho they were 64 bit people did what they had to do and go with what worked, the itanium in all reality is the most affordable 64 bit chip to date. In 94 when SGI put out its first 64 bit chip $100,000.00 was a bit much to pay. Suns sparc is also 64 bit but they also made the same mistakes. The day of proprietary UNIX is over, you will see more and more companies that used to produce proprietary UNIX variants either switch to Linux or go Bankrupt. If Apple computer is not careful it will also fall short and fall off the bandwagon. Linux will win in every category, not bad for a OS that started out as a hobby 
Yet SGI have had 64-bit MIPS processors since the mid-nineties. Why not put them to use instead?
Because they're too expensive to develop. SGI isn't like IBM where they can just keep spending on their own CPUs to keep up with Intel. Now that Intel has their own 'commodity' 64-bit CPU it's easier and cheaper for SGI to use that rather than spending hundreds of millions on CPU development. They can use the money saved from that to try to keep ahead of Nvidia, ATI and 3Dlabs in graphics, or ahead of IBM and Sun on big-iron servers, which are far more of a threat to their livelihood. MIPS isn't crucial to SGI's well-being, but graphics and big servers certainly are.
Where possible, I think SGI wants to dump MIPS quickly. I'd be surprised if they come out with anything really new that uses MIPS, although I can imagine a few speedbumps and upgrades to their existing MIPS-based machines.
SGI is just like Sun... making a giant profit on their machines, like 16 tons on the back of their customers. When the customers have alternatives that are so much more affordable, they are simply running away from SGI. Having purchased a SGI machine is like being a trauma victim. You don't ever want to go back there. It's abuse, plain and simple. How many builds of IRIX had tons of nasty bugs? Did a customer ever get a refund or free support or anything? Nope. All they got was more fees. And SGI hardware for many years has offered incredibly poor price/performance. So it is simply karma that SGI is fading away.
What to do to adapt?
1. Massively scale down the company.
2. Outsource their monster high-end machine to China, lock stock and barrel.
3. Reduce the price of the big machine by a factor of 10.
4. Form a partnership with Legend, say Legend Supercomputer, to sell this machine throuhgout China.
5. Take some cash and invest it as Apple has in getting some cool software for the hardware.
With China on a giant upswing for IT spending, it is the place to grow. SGI should be there, become the #1 high-end computer company in China.
And with high-end machines all made in China, SGI could then mount a massive attack on Sun, HP, etc., and kill them on price/performance. SGI could then easily get into Hollywood accounts as the leader. The other big boys, including Intel, wouldn't stand a chance against a totally made in China cheap supercomputer.
--ms
Interesting to note that this is a market place that MS desperately wanted to grab.
Also interesting to note that applications, graphics ones in particular (i.e. Photoshop) start their development cycle in the movie world. So if all new development is being done on Linux then those apps everyones been complaining about will be ported pretty soon.
...in terms that the US Gov't is keeping SGI alive. It's bad. A company that depends on one customer to be alive is in a bad situation.
I really hope that SGI turns to supercomputing, AND the SGI turn into supercomputing goes good. IBM needs some competition to the zSeries machines.
Hmm, does "IBM" ring a bell? or "Apple"?
Looks like companies do not learn easily..
Government money is as good as anyone else's. It's not the the government is a cohesive unit either, you have to treat like a bunch of customers, they just end up being grouped into a category.
Much like a transmission company, it only has automotive customers.
>>>>I really hope that SGI turns to supercomputing
Supercomputing has never been a much of a profitable business. It's more about bragging rights than dollars and cents.
A news site from my home state made it on OS News, man I feel soooo very special