The Pentium 4 is a radical new architecture for Intel--an introduction of the same order as the 386, 486, Pentium and Pentium II processors.
The chip has a multimedia-oriented design--the so-called Netburst technology-- that addresses some of the problems related to processors that run 10 to 20 (or even 50) times faster than the memory that feeds them.
With the new processor,
Whether these applications will inspire consumers to purchase new personal computers is unclear. However, Intel needs to firmly establish the Pentium 4 as the platform of choice in 2002 so that developers and consumers can reap the benefits of new, improved applications.
The manufacturing cost of a Pentium 4 is not the main issue with regard to profitability. Making fewer Pentium IIIs and shifting capacity to the Pentium 4 could increase gross margins and revenue--unless Intel faces supply constraints.
However, as the PC market slows down and rival Advanced Micro Devices is able to satisfy market demand for chips that are equivalent in power and functionality to Intel's Pentium III, Intel should have no problem making the switch to focus on Pentium 4.
Paradoxically, AMD's focus on and success in penetrating the market for Pentium III-power chips may naturally lead to a faster migration to the Pentium 4 for Intel.
The only question is whether Intel can pull far enough ahead in the speed race. Gartner Dataquest expects the 2GHz processor to appear sooner rather than later--with 3GHz on the horizon for the first half of 2003.
(For related commentary on microprocessor technology, see TechRepublic.com--free registration required.)
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