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Intel's new notebook strategy

The chip giant wants to be the leader in compact motherboards, the guts of all notebook PCs.

Intel (INTC) is making a bid to become the provider of the major building blocks for notebook computers, announcing today that it will ship compact motherboards and other components that make up the core of laptops based on MMX technology.

Intel is attempting to duplicate its successful desktop strategy, where it has become one of the world's largest manufacturers of motherboards for desktop PCs. The motherboard is the main circuit board in a PC and contains most of the critical chips.

To round out its offerings for the main electronics in a notebook PC, Intel will also begin to ship a second-generation chipset for notebooks, which can complement the MMX motherboard. MMX is Intel's technology for speeding up multimedia applications such as graphics, video, and communications.

The notebook motherboard, which Intel has elected to a call a "module," doesn't contain quite as much circuitry as a desktop motherboard since the company is providing more leeway for notebook vendors to provide some of their own components external to the module. But the 4-inch by 2.5-inch board still contains most of the major electronics including the MMX Pentium processor, high-speed cache memory, the processor's power supply, and circuitry for controlling the PCI bus and memory.

Intel says the module is targeted at the high end of the notebook PC market. Examples of the class of system that would use the module include IBM's 760 ThinkPad or Toshiba's Tecra, according to Intel. (Intel is an investor in CNET: The Computer Network.)

IBM has already stated that it intends to use the board and claims that it contributed to the development of the module.

Intel claims the module will speed time-to-market for notebook PC vendors as new processors come out. The company's desktop motherboard business has been built successfully on this strategy. Indeed, there have been many takers of Intel desktop motherboards among top-tier PC vendors because they can push systems with the fastest processors--and the fattest margins--out the door more quickly using the prebuilt motherboards. The list of vendors using Intel desktop PC motherboards includes IBM, Dell Computer, Gateway 2000, Toshiba, and Hewlett-Packard.

But it remains to be seen if Intel's desktop strategy can be easily applied to the notebook industry. Some of the top notebook vendors such as Toshiba have prided themselves on the fact that they make their own motherboards and circuitry, giving them a competitive advantage over other makers.

Moreover, notebook PC designs are inherently more complex than desktop designs because of space and heat limits. Some vendors believe they have developed more expertise than Intel in developing notebook motherboard technology to deal with those issues.

But as in the desktop PC business, Intel may ultimately have the upper hand since it makes the ubiquitous Pentium processors that go into its motherboards, allowing it to debut new motherboards as soon as new processors appear. This advantage may become increasingly important when Intel brings out its next-generation Tillamook MMX Pentium processor for notebooks later this year and Pentium Pro-class notebook processors after that.

The notebook module is available for $628 using a 166-MHz MMX Mobile Pentium processor and $425 using a 150-MHz chip.

Intel will also ship a separate 430TX chipset for MMX notebook PCs, priced at $32.50, which can also be used in desktop PCs. Shipping a chipset for both notebooks and desktops simultaneously is a first for the company, Intel said. The feat is proof that the gap between notebook and desktop performance is closing, company representatives said.

In addition, Intel is shipping the 380 Dock Set, a group of chips that enable notebook vendors to build a data bridge between a docking station and the notebook PC. The 380 Dock Set is priced at $28.