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Pentium II package may change

Intel is contemplating changing its distinctive "Slot 1" design on certain upcoming versions of the Pentium II chip as a way to drive down costs.

Intel (INTC) is contemplating changing its distinctive "Slot 1" design on certain upcoming versions of the Pentium II chip as a way to drive down costs.

The debate reflects the balancing act the company faces as it tries to accommodate its premier processor to the wide spectrum of computing devices. On one hand, Intel wants to make Pentium II chips for everything from expensive eight-processor servers to set-top boxes costing $300 to $500. On the other, the company acknowledges that this creates cost/design issues.

"If we want to get down to the $999 [system] price point, which we will do with the Pentium II in the second half of next year, we have to do some radical things, so we are looking at new form factors--"cacheless" parts, integrated cache, new kinds of packaging," said Mike Aymar, vice president and general manager of Intel's consumer products group.

While Intel has said it will eliminate or reduce the cache memory on certain Pentium IIs to drive the price down, a switch away from the Slot 1 is new and would change the characteristic look and feel of the chip. The Slot 1 package--a sleek, black, and rather large unit that resembles a consumer product more than a traditional microprocessor package--has thus far been synonymous with Pentium II. The shift would also mean that Intel would be moving away from a popular design that, right now, only Intel has the ability to manufacture.

Aymar stated that a decision to move away from the Slot 1 design has not been made, but clearly indicated that such a shift is on the company's mind.

"The version of the Pentium II we move to the consumer market will use that 'PII' system architecture," he added. "Eventually, as we keep focusing on costs, we may find that we have to come out with a more traditional package, a plastic or ceramic package. Right now, we don't plan on that but it's part of our learning curve."

A shift from the Slot 1 is a logical step, but also one that will require additional work on Intel's part, according to Mike Feibus, principal at Mercury Research.

The Slot 1 design debuted when the Pentium II processor came out earlier this year and marked a radical departure in chip packaging. Slot 1 allowed Intel to attach a secondary memory cache, with its own bus, to the processor, a change that enhanced the chip's computing power. Cache memory is used to bridge the shortfall between the speed at which memory makes data available to the processor, and the faster speed at which the processor itself operates.

Positioned as a high-end workstation and desktop chip, the Pentium II/Slot 1 chip also held the potential to stifle competition, said many, because it was based on a proprietary and heavily guarded design that Intel showed no desire of licensing to competitors.

If the low-end versions of the Pentium II do not have the additional cache, much of the reason for having a Slot 1 package vanishes, Feibus said. Slot 1, however, also provides insulation for the processor. If Intel moves away from the design, the company will have to compensate for this factor.

"My understanding is that they are working on the mechanical issues," Feibus said. "With Slot 1, there is an established way to attach a fan and a heat sink to the [processor] package. When you remove it, you have to come up with something else."

Shifting away from the Slot design would also cut costs, which may be necessary even after removal of the cache.

"I have no doubt that they will get Slot 1 into a sub-$1,000 box, but getting it into a sub-$700 or -$500 box? They've still got some work," Feibus added.

Nathan Brookwood, semiconductor analyst at Dataquest, who was contacted before Aymar's statements, agreed with Feibus. Removing the cache will drive down costs, but further changes are necessary on Intel's part to make the Pentium II a low-end candidate.

"In the long run, they have to do more," he said.

Steve Tobak, vice president of corporate marketing at National Semiconductor, said that the debate around Slot 1 shows that Intel is playing catchup in the low-cost arena.

"It is an indication that Intel was caught by surprise by the sub-$1,000 market," he crowed. "They appear to be struggling to me."

National, which earlier in the year acquired Cyrix, has claimed that it has obtained the intellectual property necessary to make Slot 1 chips. The company, however, said that it has not decided whether to make Slot 1 devices.

Intel is an investor in CNET: The Computer Network.