AMD unveils new chips, cuts prices

Advanced Micro Devices announces two new desktop microprocessors, but consumers won't be able to get them until next month. It also cuts prices across its Athlon line.

John G. Spooner
John G. Spooner Staff Writer, CNET News.com
John Spooner
covers the PC market, chips and automotive technology.
2 min read
Advanced Micro Devices announced two new desktop microprocessors Tuesday, but consumers won't be able to get them until next month.

The Sunnyvale, Calif.-based chipmaker said it has begun to ship its Athlon XP 2600+ and 2400+ processors to manufacturers. However, consumers won't be able to buy the chips, or computers running them, until September, the company said.

The announcement, as expected, comes amid a desperate race between AMD and longtime rival Intel. With the downturn in the PC market, the two companies are cutting prices and raising the speed of their microprocessors to gain as much market share as possible and curtail revenue declines. Last quarter, Intel regained six points of market share, on a year-to-year basis, partly through price cuts.

Next week, Intel is expected to release four new Pentium 4 processors for desktops, including a 2.8GHz Pentium 4, and follow up with substantial price cuts.

AMD, meanwhile, is already cutting prices.

The smaller company achieved an important milestone earlier this week when Hewlett-Packard adopted one of its Athlon chips for a computer aimed at the medium-sized business, education, and government markets. The deal marks the first time a "big three" manufacturer has adopted the company's processors for the business market.

AMD's latest chip to this point, the Athlon XP 2200+, came out in June and could be bought the same day it was announced on computers from Hewlett-Packard, among others.

The Athlon XP 2600+ will run at 2.133GHz; the 2400+ will run at 2GHz, said Nathan Brookwood, an analyst at Insight 64. Although slower in terms of megahertz, the upcoming Athlons boast performance that's roughly comparable to that of Intel's best chips.

"(AMD) had fallen behind, but they have closed the gap to a certain degree," Brookwood said.

The two new Athlon chips will list for $297 and $193, respectively. And given a new round of price cuts, the 2400+ chip will list for only slightly more than the 2200+, which was lowered 20 percent from $230 to $183.

AMD also reduced prices by between 3 percent and 12 percent on the rest of its desktop Athlon XP models. It cut the price of the 2100+ chip from $180 to $174; the 2000+ chip from $163 to $155; the 1900+ chip from $150 to $139; the 1800+ from $142 to $130; and the 1700+ from $130 to $114.

The company last cut prices on July 26.

AMD lists these prices for chips purchased in lots of 1,000, but it negotiates individually with parties that purchase larger amounts. This practice causes prices from distributors to vary, enabling buyers who are looking for one or two chips to find them for less than the list price.