SGI Forms Separate Unit for Cray Business

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Posted by Terry Jones on August 10, 1999 at 16:21:23:

MOUNTAIN VIEW, Calif., Aug. 10 /PRNewswire/ -- SGI (NYSE:
SGI) today announced it has formed a
separate business unit to lead development, marketing, sales
and service for the company's Cray(R)
vector supercomputers. SGI said it is in active discussions
with other companies to assume the
operation of the Cray business through a partnership or
other transaction.

The Cray business unit, based in Chippewa Falls, Wis. and
Eagan, Minn., will be responsible for the
Cray T90(TM), the new Cray SV1(TM) and the next-generation
Cray SV2(TM) vector supercomputer
products, along with the Cray T3E(TM) scalable parallel
system. In the latest (June 1999) independent
ranking of the "World's Top 500 Supercomputer Sites," Cray
systems accounted for five of the top 10,
and 26 of the top 50 supercomputers in the world.

"The Cray business focuses on serving the special
requirements of vector supercomputing customers,"
said Rick Belluzzo, chairman and CEO. "This is an important
business that is complementary to SGI's
scalable server business, but the vector market has its own
distinct product cycles, application
partners and sales and service model. We have decided that
pursuing these agendas separately but in
coordination creates the best opportunity for the success of
both businesses. We will continue to have
a close relationship with the business since the forthcoming
Cray SV2 product line will be built in
conjunction with SGI's next-generation SN server platform
technology. And SGI itself will continue to be
a leader in supercomputing with our scalable ccNUMA

The Cray business represents less than 10 percent of SGI's
overall revenue, based on the quarter
ended June 30, 1999.

The new unit will be headed by supercomputer industry
veteran Steve Oberlin, currently vice president
of Engineering for SGI's Servers and Supercomputers Business

"For certain important classes of government and industrial
applications, there is simply no substitute
for vector supercomputers," Oberlin said. "We're excited
about the opportunity to place increased focus
on this business and its special sales and service
requirements. We look forward to continuing the
development of the next-generation Cray SV2 vector product,
which we believe will redefine vector

Along with the Cray supercomputer products, the new unit
will manage advanced packaging, cooling
and CMOS technologies; scalable software, including the
UNICOS(R) and UNICOS/mk(R) operating
systems; and the CF90(TM) and SHMEM programming

SGI will continue to have significant engineering, sales and
service activities at its Eagan site, and
Chippewa Falls will continue as a principal manufacturing
and engineering location.

This press release includes forward-looking statements that
involve a number of risks, uncertainties
and other important factors that could cause actual results
or activities to differ materially. The
discussions with third parties described in this press
release are preliminary, non-binding discussions
and there is no assurance that the company will be able to
reach definitive agreements or to
consummate those agreements. Other factors that may affect
the company's actual results include the
risks, uncertainties and other factors set forth in its
filings with the SEC (, particularly
those described under the caption "Risks That Affect Our
Business," including the timely development,
production and release of future Cray vector products;
future levels of market acceptance and customer
demand for vector computing products; and the impact of
competitive markets, products and pricing.

SGI provides a broad range of high-performance computing and
advanced graphics solutions that
enable customers to understand and conquer their toughest
computing problems. Headquartered in
Mountain View, Calif., with offices worldwide, the company
is located on the Web at

NOTE: SGI and the SGI logo are trademarks of Silicon
Graphics, Inc. Cray, UNICOS and UNICOS/mk
are registered trademarks, and Cray SV1, Cray SV2, Cray T3E,
Cray T90 and CF90 are trademarks, of
Cray Research, L.L.C., a wholly owned subsidiary of Silicon
Graphics, Inc. All other trademarks
mentioned herein are the property of their respective


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