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PC makers gear up for new Celerons

This week, companies will unveil new, low-cost computers with features once seen only in fancy high-end machines.

PC makers are gearing up for the newest Intel processor due out this week, readying low-cost computers with features once seen only in fancy high-end machines.

When first introduced, Intel's Celeron was designated as the company's answer to Advanced Micro Devices dominance in the low-end of the market.

But as Intel has quickly refreshed the processor line with faster and faster clock speeds and integrated cache, the sub-$1,000 systems running on the Celeron are starting to resemble higher-end PCs.

Intel is expected to introduce the 433-MHz version of the Celeron processor today, said sources close to the company. But computer makers like Hewlett-Packard will start shipping their new systems to stores this weekend.

HP is set to introduce new systems in its Vectra line of corporate computers and its Brio line of PCs for small and medium-sized businesses, said sources close to the company. These are some of the first sub-$1,000 systems to offer 433-MHz processors.

HP will ship a new Vectra PC with the new Celeron processor, 4.3GB hard drive, and 32MB of memory for an estimated retail price of $905. The new Vectra will be available today.

NEC is also expected to launch new Celeron-based systems in its recently announced ES (Enterprise Systems) and VT (Value Technology) lines.

The ES5200 with 32MB of memory, 4.3GB hard drive, 4MB video memory and built-in Ethernet card will start at $1,049, while the VT300 in the same configuration but without an Ethernet card, will start just under $1,000.

NEC's systems will hit stores in the beginning of April. Other PC makers are expected to follow suit. Dell, for instance, recently entered the sub-$1,000 market for the first time with a 333-MHz Celeron system, while Emachines is expected to introduce a 400-MHz Celeron computer for $599 later this month.

The 433-MHz Celerons are expected to prompt a new round of processor price cutting. The chip will cost around $160 or less in volume and around $180 as a retail product, and to clear the shelves, Intel will likely cut the prices of its current Celeron processors--which sell for between $133 and $63 in volume quantities--between 10 to 20 percent, said sources.

These cuts will then certainly prod archrival AMD to cut the price of its K6-2 processors. The last two times Intel cut Celeron prices, AMD followed hours later with its own cuts. In volume, the K6-2 is now priced one dollar less than Celeron chips running at the same speed.

The 433-MHz chip coming out today will be followed by a 466-MHz Celeron and a chipset with integrated 3D graphics in the second quarter. A 500-MHz Celeron is scheduled to come out in the first part of next year.