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AMD rolls out mobile chip, readies K7

The chipmaker releases low-powered versions of its K6-III processor for notebooks today amid rumors that yields for the upcoming K7 may be better than expected.

Advanced Micro Devices released low-powered versions of its K6-III processor for notebooks today amid rumors that yields for the upcoming K7 may be better than expected.

The three new mobile K6-III P processors from AMD give the company an edge over rival Intel. The top K6-III P runs at 380-MHz and contains 256KB of performance-enhancing secondary cache integrated into the same silicon as the processor. The "P" indicates that the chips run at a lower voltage than standard K6-III desktop chips.

Intel's top Pentium II and Celeron processors for notebooks go to 366-MHz and do not provide the same level of cache performance. Intel, however, is slated to up the ante by the middle of the year with mobile chips running at 400-MHz and 433-MHz.

Compaq has already committed to using the chip in Presario notebooks and other design wins should follow, according to AMD executives.

"AMD is introducing another first in the notebook market," said Dana Krelle, vice president of marketing for AMD's Computation Products Group in a prepared statement. "The Mobile AMD-K6-III-P processor builds on the success we have had with the previous generation Mobile AMD-K6-2 processor, and extends our mobile offerings into the high-performance notebook space."

Meanwhile, AMD's stock has jumped recently on reports that production yields on the upcoming K7 processor appear to be slightly better than anticipated, according to a report from Ashok Kumar, semiconductor analyst for US Bancorp Piper Jaffray.

AMD's stock, which last month dipped under $15, has been battered because of production glitches and financial losses at the company. In recent weeks, however, the stock has got a boost on word about the K7, and has recently traded around $20.

The K7, due next month, is viewed as a pivotal product for the company. The chip's design has generally received positive reviews from analysts. On paper, the K7, which will come out at 500-MHz, 550-MHz, and 600-MHz, will deliver performance close to--and even better than--the Pentium III, depending on the application, according to various sources. Further, the K7's ability to run Windows NT and fit into multiprocessor servers could pave the way for AMD to grab a larger chunk of the business PC market.

On the other hand, AMD's history of rolling out new products is far less than spectacular. Over the past two years, the company has failed, on repeated occasions, to quickly manufacture high volumes of its fastest processors. As a result, the company's processors often get announced when the market will pay relatively high prices for them, but only appear in volume after Intel has cut prices on chips running at roughly the same speed and introduced faster chips.

"AMD has had an abysmal history of manufacturing and delivery problems related to the K5 and K6. The K7 is the third time that the company is asking investors to make a bet that it can execute," Kumar wrote. "The K7 is AMD's only ticket to break out of the value PC space. With history as an indicator, improved speed distribution on sample lots does not translate to a similar profile in production volume."

The mobile AMD-K6-III-P/380 processor costs $349 in 1,000-unit quantities. The 366-MHz version is priced at $316 and the 350-MHz version is priced at $249.