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AMD's new chip revs up low-cost PCs

The chipmaker will get a boost from the Home Shopping Network when the cable channel introduces PCs with the new 850-MHz Duron chip.

Live from Las Vegas, it's Advanced Micro Devices!

The Sunnyvale, Calif.-based chipmaker will get a boost from the Home Shopping Network this weekend, when the cable channel introduces computers featuring AMD's new 850-MHz Duron chip.

The low-cost chip for desktop PCs will be officially announced on Monday. But the shopping network will begin taking orders on 850-MHz Presario desktops from Compaq Computer during a live broadcast from the Consumer Electronics Show floor on Saturday, according to AMD.

Analysts say the faster clock speed and Duron's faster front-side bus, which is a data pipeline between the processor and memory, mean that the new Duron systems will outperform even Intel's latest offering, a new 800-MHz Celeron announced earlier this week.

Performance, however, is only half of the equation. AMD is also working hard to keep the cost of Duron-based computers down.

The company introduced the Duron line in June, but the chip didn't start appearing in computers from major manufacturers in the United States until November. The delay was partly caused by a lack of companion chipsets with integrated graphics, which raised the cost for manufacturers.

During the third quarter of 2000, even AMD's much older K6-2 family of processors eclipsed Duron sales. AMD shipped about 3 million K6-2 chips and less than 1.5 million Durons in the third quarter, according to Mercury Research.

Via Technologies and Silicon Integrated Systems are now helping to alleviate this problem with new chipsets.

The 850-MHz chip "is definitely a good value. It's hard to imagine how many users would need more (clock speed) than that," said Mike Feibus, principal analyst at Mercury Research. "The (lack of integrated chipsets) has slowed it down. However, I think that's going to start to change now that the (Via chipset) KM133 is starting to take off."

It's all in the chipsets, agreed Mark Bode, an AMD division marketing manager.

"We're expecting the first systems (with the integrated chipsets) to become available this quarter and next, depending on (manufacturers') schedules," he said.

With the new chipsets, which allow PC makers to eliminate a graphics board and therefore cut roughly $100 off the retail price, Bode said he expects to see some low-end Duron systems priced at $599 or less in coming months.

Meanwhile, PCs fitted with AMD's 800-MHz and 850-MHz Duron chips will hold the line at $899 to $999, he said.

The 850-MHz Duron will be priced at $149 each in quantities of 1,000.

AMD said it offers a 5 percent to 7 percent performance increase over the 800-MHz Duron, which it reduced from $170 to $112. The 750-MHz Duron was reduced from $112 to $88. AMD has also ceased the manufacturing of its 850-MHz Athlon processor, due to the release of the 850-MHz Duron.

PC makers such as Compaq are expected to announce support for the new chip on Monday.

"This quarter really should be the turnaround for Duron," Feibus said. "Our forecast is for more than twice the third-quarter units shipped."