According to reports, Sun Microsystems has decided to use chips from Intel in some of its servers.

Although there is no official announcement from either company yet, it is expected sometime this week.

The specifics of the deal are not clear but it is certain that Sun will use Intel's Xeon processors in its x86 servers.

If reports are to be believed, the first servers from this partnership will be launched in the first half of 2007, and Sun will also sell Xeon-based workstations.

Industry sources are of the view that the deal marks a shift in favor of Intel, which has been fighting a long battle against AMD to reverse dropping profits, and regain lost market share. Intel has lost more than 5 percent of the computer chip market to AMD last year.

While Sun had earlier opted for AMD over Intel, saying Intel's chips are slower and more power-hungry, Intel's new dual-core Xeon 5100 "Woodcrest" and quad-core Xeon 5300 "Clovertown" processors have succeeded in restoring to some degree, Sun's faith in Intel.

Meanwhile, Sum will continue using AMD chips in some of its products.

Apart from Sun's use of Intel chips in some of its servers, Intel will also endorse Sun's Solaris operating system.