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AMD's new chips heat up notebook race

Advanced Micro Devices is releasing two new notebook chips, narrowing the performance gap with rival Intel.

Advanced Micro Devices is releasing two new notebook chips Tuesday, narrowing the performance gap with rival Intel.

The Athlon XP 2000+ and 1900+ processors will be featured in consumer notebooks coming out from Hewlett-Packard, Fujitsu-Siemens and others, according to AMD.

The chips will provide approximately the same performance as the Intel's 2GHz and 1.9GHz Pentium 4 chips, according to historical trends. Intel's fastest mobile chip, the 2.2GHz Pentium 4, will still likely rule the mobile performance roost, but Athlon-based notebooks often cost substantially less.

Although the overall PC market continues to shrink, notebook sales are growing, partly because of declining prices and a burgeoning market for consumer notebooks.

In Europe, notebook sales rose 16 percent in the first half of the year while desktop sales shrank 11 percent. Less extreme but similar swings are occurring in the United States as well.

Sunnyvale, Calif.-based AMD has endured a series of hard knocks this year with the slowdown in the tech market. The company reported revenue for the second quarter of $600 million, far less than earlier expected, and a net loss of $184.9 million, or 54 cents a share. AMD also lost market share to Intel during the period, according to Mercury Research.

Earlier this month, the company delayed the release of "Barton", a new version of Athlon for desktops, and "Hammer," a chip with a completely new design. Barton will now come out in the first quarter, and Hammer will hit shelves late in the first quarter or early in the second quarter. An Athlon 2400+ for desktops, originally slated for the second quarter, is due this month.

The Athlon XP 2000+ and 1900+ sell for, respectively, $345 and $239, in 1,000-unit quantities. AMD, though, often sells its chips for far less through negotiated discounts, leading to additional savings. A company representative declined to comment on any pending price cuts.