The AMD Istanbul family beats Intel's Xeon 5500 in cores per chip. However Intel rolled out a six-core server chip—called Dunnington—based on its previous generation design.

John Fruehe, director of AMD's server business, said AMD's four-core CPUs out-performed Dunnington on some tasks because the Intel part used an external memory controller, causing bus contention.

AMD's Istanbul fits into existing AMD sockets. The Xeon 5500 required new motherboard designs because it was Intel's first chip with an integrated memory controller and a new processor interconnect.

Intel used the need for a new motherboard design to shift to support for DDR3 memory. AMD will not shift to DDR3 in server CPUs until next year.

"DDR3 is a great tech for 2010," said Fruehe. "Today it has a price premium, consumes about 1W per DIMM and has higher latency but early next year there will be versions with lower latency and power and no price premium," he added.

AMD is expected to release its first server chip set, the 5690, before the fall that will sport performance and energy enhancements. The resulting Fiorano platform will support both enhanced Istanbul systems as well as 2010 designs using both DDR3 and new six- and twelve-core processors coming next year.

The new AMD processors come in versions supporting two, four and eight chips in a multiprocessing system. The Xeon 5500 is only available for two-socket systems now, with four-socket versions coming later this year.

Intel still claims an edge by supporting dual-threading, running up to 16 threads simultaneously on the Xeon 5500. AMD has not adopted multithreading, claiming it does not offer significant performance advantages.

Istanbul is a follow on to AMD's first 45nm CPUs, the four-core Shanghai server CPUs, released in November.

"This is the fifth major product we have shipped on or ahead of schedule," said Leslie Sobon, AMD's vice president of marketing.

The company stumbled badly with its Barcelona processor, missing by several months the schedule for the chip, AMD's first 65nm four-core design.