SGI faces dismemberment, Nvidia interested in bits

Update 18:46 GMT SGI said it would lay off 250 people, with CFO Jeff Zellmer and COO Warren Pratt quitting. A number of other execs have gone. We understand SGI is continuing to explore other options. CEO Dennis McKenna said his next step is to "effectively position SGI's existing products for better differentiation in the market place". SGI said nothing about the Intel Itanium microprocessor.

SGI WILL spin off different parts of its business, sources said. The word is its graphics business is up for grabs and the rumour is that Nvidia is interested.

Nvidia and SGI have had conversations in the past. Since SGI sold much of its intellectual property to Microsoft a while ago, it isn't the prize it may seem to be on the surface. Either way, the division was deeply in the red, and this will be a big help to SGI's bottom line.

While SGI has made big changes on the management level, the good news is that most of the engineering staff working on the server and storage side have stayed in place.

So it seems as if the new management is doing all the right things for the right reasons. Strong points are being bolstered, or at least not touched, and the deadwood is being burned.

Sources tell me that details will be revealed today at an employee meeting. The only question left is, what does management call the company if graphics is not part of the mix? µ