AMD raising chip's speed to 500 MHz

The 500-MHz K6-2, AMD's main chip before Athlon's debut, will even the speed race in the budget-processor arena. Intel released a 500-MHz Celeron processor earlier this month.

IBM will use the new K6-2 in an Aptiva system in the United States while Hewlett-Packard is releasing a 500-MHz K6-2 system in Asia, sources at AMD said. IBM is also one of the big supporters of the Athlon chip, the new generation processor released earlier this summer.

The new K6-2 chip is expected to cost around $167 in volume shipments, the same as the 500-MHz Celeron. AMD, however, will not cut prices on the rest of the line, a company spokeswoman said.

The boost to 500 MHz could also represent the last speed increase for the K6-2 for a while. Analysts have said that AMD won't be able to mass-produce chips above 500 MHz with the current 0.25-micron manufacturing process. The company likely will be able to squeeze the chip to 600-MHz or more when it shifts to the more advanced 0.18-micron process, according to Linley Gwennap, publisher of The Microprocessor Report, and others in the industry.

However, the shift to 0.18-micron manufacturing, which shrinks the size of the transistors and improves overall efficiency, won't occur on the K6-2 line until next year, sources have said. AMD first will attempt to move to the smaller manufacturing technique with Athlon in the fourth quarter.

AMD has said it will bring a version of Athlon to the consumer market toward the middle of 2000. Until then, the K6-2 and, to a lesser extent, the K6-III, will be the company's main processor for the budget market.

Both AMD and Intel are expected to release additional mobile chips in September, sources have said.