Sun will use Intel chips in its server systems

  Sun Microsystems Inc. and Intel Corp. are close to an agreement where Sun would buy Intel chips to use in its server systems, the Wall Street Journal reported in its online edition on Sunday. Ths deal would be a blow to Advanced Micro Devices Inc,which is now Sun's exclusive source for chips based on the popular x86 design used in most personal computers and servers.

  That dual-supplier strategy is already used by competitors IBM., HP, according to the report, which said adding Intel-based servers would help Sun match the breadth of those rival offerings.

  Sun announced a strategic exclusive alliance with AMD in 2003 to produce market-leading x86/x64 servers based on AMD's Opteron processor Sun would keep making server systems based on AMD chips.

  Sun and Intel declined to comment.