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Intel, AMD duke it out with new chips

It's a new year and a new round of processor battles between the chip giants. But are one company's new chips--which launch Monday--really better than the other's?

It's a new year and a new round of processor battles between Intel and Advanced Micro Devices--and that means newer, faster PCs for desktops near and far.

In the predawn hours Monday, as expected, AMD launched its new Athlon XP 2000+, which runs at 1.67GHz, and shortly after that Intel followed suit with its new "Northwood" Pentium 4 running at 2GHz and 2.2GHz.

The chip debuts kicked off the usual parade of announcement from PC makers. Dell Computer has introduced a new Dimension 8200 desktop starting at about $1,900 with the new 2.2GHz Pentium 4, a Dell spokesman said. And Compaq Computer has begun offering a new Presario 8000 desktop containing the Athlon XP 2000+ chip, starting under $1,500.

A variety of other computer makers are expected to turn out new PCs that use the Intel chips, while Hewlett-Packard is expected to match Compaq in the near future with a new Athlon XP 2000+ desktop.

Although the AMD chip churns at a slower pace, the actual performance difference between the two processors is relatively narrow because the chips employ different architectures.

"It is so close you are going to need a photo finish," said Nathan Brookwood, an analyst at Insight 64. "Different benchmarks will show different things, but the two are right on top of each other...You might see Intel ahead by a nose."

Because of the close performance, victory in the companies' ongoing war may rest on other factors. Intel's chips are slightly larger, measuring 146 square millimeters. AMD's measure 128 square millimeters and will shrink to 80 millimeters in the first quarter. Smaller chips are cheaper to make, so AMD enjoys some advantage there.

Intel is releasing its chip with a new chipset that allows PC makers to hitch the Pentium 4 to DDR memory, a faster version of standard memory. While this will expand the variety of Intel PCs on the market, introducing a new chipset is never easy and can result in sporadic shortages. AMD made the DDR DRAM leap 14 months ago.

Still, Intel is Intel and has a massive manufacturing operation, an efficient worldwide sales force, and long-standing relationships with corporate customers. The company this year will also shift to using wafers with 300-millimeter diameters, larger than the 200-millimeter wafers used today. This will allow Intel to effectively produce 2.5 times more wafers for roughly the same cost. AMD won't shift to 300-millimeter wafers until 2005.

"That investment in 300 millimeter will pay off for us in volume," said Louis Burns, vice president and general manager of the desktop products group at Intel. "We're going to be hitting huge volumes of the Pentium 4 this year. We will hit all price points at all levels."

PCs and prototypes
Intel also will continue to work with the industry to popularize multimedia and entertainment applications, a specialty of the Pentium 4.

For instance, Burns showed off a prototype machine called the Intel CEL. The CEL looks like a small cable box and allows people to attach a PC to a stereo or TV and then feed data into it. With the CEL, a TV can be used to show digital photos or capture live TV a la TiVo. At one point, Burns was running two video streams, playing music and recording video on the same PC.

"This kind of capability will be commonplace in the 2003-2004 time frame," he said.

The Athlon, however, is no slouch when it comes to these applications, added Brookwood.

And the chips will appear in more conventional PC forms as well. Dell's new Dimension, sporting the 2.2GHz chip, will come with a 20GB hard drive, 256MB of Rambus DRAM, a 17-inch monitor and a CD-ROM drive for a $1,909 introductory price. Compaq's Presario 8000 offers the XP 2000+ chip, 256MB of Double Data Rate SDRAM, a 60GB hard drive, a DVD-ROM drive, a CD-RW drive and a 17-inch monitor.

Gateway also began offering PCs with the new Pentium 4 chips Monday. The company's Gateway 700XL, priced at $2,999, packs the 2.2GHz Pentium 4 chip, with a DVD rewriteable drive, 1GB of Rambus DRAM memory, a 120GB hard drive and an 18.1-inch flat-panel display.

The updated design of the new Pentium 4s, code-named Northwood, will also give Intel the opportunity to pull ahead at times in terms of speed and performance. The Northwood Pentium 4 chips differ from the current versions of the chip in that they are made using the 130-nanometer (0.13-micron) manufacturing process, rather than the 180-nanometer process used to make existing Pentium 4s. The 130-nanometer designation refers to the average size of the features on the chip.

The manufacturing switch results in a shrinking of the chip. Older Pentium 4s measured 217 square millimeters and cost about $100 to manufacture, estimated Kevin Krewell, an analyst at the Microprocessor Report. The Northwood chips will cost about $55 to make.

At the same time, performance will improve because Northwood chips will offer, along with the higher clock speeds, a larger secondary cache--a reservoir of memory located on the same piece of silicon as the processor for rapid data access. Northwood chips will contain 512KB of cache; current Pentium 4s contain 256KB.

"Because of the increase in cache and the boost in clock frequency, Intel will start to pull away from AMD," Krewell said. "Even with the larger cache, (the chip) is going to be smaller."

AMD will launch a new 130-nanometer Athlon XP chip, dubbed Thoroughbred, later in the quarter.

Of course, the two companies say the difference between their chips is far more substantial.

"Unequivocally, it is the fastest thing on the planet," said Burns of the new Pentium 4 chips.

Mark Bode, division marketing manager for AMD, responded, "We've got a product that is hands down the proven performance leader."

The 2.2GHz Pentium 4 will sell for $562 in 1,000-quantity units, while the 2GHz version will sell for $364.

The new Athlon XP 2000+ costs $339 in volume.

The price cuts were widely predicted. Intel typically cuts chip prices on the last Sunday of each month. The company also introduced new versions of the Pentium 4 at the beginning of January, a move that usually gets followed by discounts.