Advanced Micro Devices, the world’s No.2 maker of processors for PCs, said it would tend to triple its server market share by the end of the year as a result of design wins with major server customers and closer relationships with server manufacturers.

Historically AMD has been known as a maker of clones of Intel’s processors, hoverer, starting from the mid-nineties the Sunnyvale, California-based chipmaker started to develop its own central processing units. The first strong rival for Intel’s Pentium III processors – the AMD Athlon – emerged in 1999 for desktops and evolved into server/workstation product – the AMD Athlon MP – in 2001. However, AMD’s recognition in the server space only happened in mid-2003 when the company released the world’s first commercial x86-64 processor – AMD Opteron.

Armed with the Opteron microprocessor AMD has managed to increase its market share in the server space by about 6% in the first quarter of this year as a result of 3.5% servers incorporating AMD’s server products (since servers may have more than one processor, the number of chips shipped to market may not ). Due to design-wins with IBM, HP and Sun, along with adoption of AMD’s Opteron chips by companies like Cray, AMD’s executives hope to install AMD’s server chips into 10% of x86 servers shipped by the end of the year, CNET News.com reports quoting Ben Williams, AMD’s vice president of the server/workstation microprocessor business unit.

The main driver of AMD’s success in the server space is popularity of AMD Opteron processor. Recently a number of large companies, such as VeriSign and Sabre, and government agencies, like CIA, adopted a number of AMD Opteron-based servers. Furthermore, AMD has managed to establish strong ties with server subdivisions of HP, IBM and Sun. Dell, IBM, HP and Sun control over 70% of x86 server market.

Up to now the most popular AMD Opteron-based platforms were 1-way and 2-way, but this year 4-way systems will also make it to the mass market. Additionally, 8-way systems are likely to demonstrate their strength.

Intel, the world’s largest chipmaker and AMD’s main rival, now also supplies its x86 chips with 64-bit capability, putting additional pressure on sales of AMD server products.