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AMD to unveil Athlon XP 3000+ chip

Chipmaker Advanced Micro Devices on Monday plans to add some muscle to its desktop processor line with the introduction of the new processor.

Advanced Micro Devices on Monday will beef up its desktop processor line with a new Athlon XP 3000+ processor.

The chip, based on AMD's new "Barton" processor core,

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represents a potential bright spot for the company, after a year of difficulty brought on by the sluggish PC market and excess inventories in 2002.

The Barton core gives the 3000+ a larger 512KB cache and support for AMD's 333MHz bus. The larger cache and faster bus--holding larger amounts of data close to the processor core and speeding up data to and from the chip--help increase the chip's model number by boosting performance.

Because AMD delayed its next-generation Athlon 64 chip until September, Athlon XP 3000+ using the Barton core will become the cornerstone of AMD's desktop processor product line for the better part of 2003. The chip is part of the company's effort to ratchet up its competitive position against rival Intel, for one, and also help AMD command higher prices for its chips.

The new 3000+ chip will list for $588, nearly $200 more than its Athlon XP 2800+. Higher prices hold the potential to translate to positive results on earnings. AMD, which put together a string of earnings report losses during 2002, expects to break even in the second quarter of this year on the strength of better sales of processors like the 3000+ and flash memory. The company hopes that a cost-saving plan put into motion at the end of the third quarter of 2002 will help it along as well.

AMD will also be releasing on Monday a new 2800+ chip based on the new core. And an Athlon XP 3200+ is in the works for a midyear introduction. The new 2800+ chip will sell for $375. But AMD will hold prices steady on the remainder of its desktop chips.

But the lack of an even higher-performance desktop chip--the Athlon 64, which had been scheduled to come out in March or April--will be a big disappointment for some PC manufacturers and their customers, leaving the Athlon XP 3000+ with some expectations to make up for, analysts said.

"With the absence of Clawhammer (the code name for Athlon 64), AMD needs products for the high-end of the market. Until now, it didn't really have one," Mercury Research analyst Dean McCarron said. "If things go well, we'll look back and say, 'yeah, that was the turning point.' But it's too soon to tell."

The 3000+ will fill the performance gap and then some, a company representative said. AMD's tests showed the chip outperformed the 3.06GHz Pentium 4 by as much as 17 percent on some applications, she said.

AMD's model number system evaluates the Athlon XP's performance against an older Athlon chip, the model numbers usually also equate to Intel's Pentium 4.

So far, AMD has assembled a large number of supporters for the 3000+ chip. Nearly 25 PC makers, including Hewlett-Packard and Falcon Northwest in the United States, will offer the chip in systems around the world by the end of next month, AMD said.

But executives at AMD's biggest customer, HP, were disappointed over not being able to offer Athlon 64 systems on time, said Bruce Greenwood, director of product marketing for desktop PCs at HP.

"Clearly there is a market that's awaiting the (Athlon 64) part. Every missed launch lets Intel get that much further ahead and disappoints AMD's customer base," McCarron said. "There's a number of OEMs (original equipment manufacturers) that were willing and ready to use it as soon as it becomes available. It's a shame it's not sooner than later."

For its part, Intel is brewing faster Pentium 4 chips, including a new 3.2GHz processor that will offer an 800MHz bus. The company is also expected to compliment the 3.2GHz chip with a new line of slower 2.4GHz to 2.8GHz Pentium 4 chips that include hyperthreading and use the 800MHz bus. This entire family of Pentium 4s and the chipset are all expected in the second quarter of this year.

While AMD said it pushed the Athlon 64 chip back to better align its introduction with software, analysts believe the company has had problems with manufacturing the chip. The problems were most likely in perfecting its silicon on insulator (SOI) process, which jumps up performance and helps lower power consumption, McCarron said.

AMD's Opteron server chip--which is based on the same technology as the Athlon 64--is on track for an April 22 launch, AMD said.