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Intel develops e-commerce on a chip

The company will embed security functions into its Pentium III chip by the middle of this year

Functions for electronic commerce and improved network security will be hardwired into PC technology by the middle of the year, a technological change that will likely jumpstart the electronic commerce industry.

By mid-year, Pentium III-based PCs will contain circuitry dedicated to conducting electronic commerce and other security functions, sources said. The ready availability of this circuitry in turn is expected to lead to the further spread of e-commerce applications and e-commerce users. These features will also likely increase in number toward the end of the year when Intel moves to the 0.18-micron manufacturing process, which will allow the company to cram more transistors onto each processor.

The movement toward embedding electronic-commerce functions into the basic silicon of a server or PC comes as a result of a long-range licensing deal between Intel and security software developer RSA Data Security, the companies announced yesterday.

Under the deal, RSA said it would begin to release software-developer kits optimized for the Intel platform. RSA's technology is incorporated in a wide variety of e-commerce applications, which means that these applications will become optimized for Intel-based PCs and servers. Similarly, Intel will begin to roll out silicon optimized for RSA-based software, according to a company spokesman.

More details on exactly how security functions will be embedded into Intel chips will come tomorrow when Pat Gelsinger, vice president and general manager of the desktop product group at Intel speaks at the RSA Data Security Conference in San Jose.

The deal will likely have a number of long-term implications. Third party electronic commerce software developers, for example, will be able to point to a wider potential audience for their products. Similarly, customers may in turn become less reticent about ecommerce. In any event, they will have to worry less about having the requisite hardware.

'"Without support from major vendors like Intel, security has been an add-on product," said Gartner Group analyst Rebecca Duncan, who called the announcement a "strong move."

"For customers, this means they don't have to worry if it's secure or if it's compatible," Duncan added.

Peter Craig, vice chairman of security hardware vendor Rainbow Technology said the news was not surprising.

"Anything that is done to stimulate crypto use on user desktops will result in more demand for high-performance hardware," said Craig, whose company markets crypto acceleration hardware.

At the same time, Dave Boswick, an analyst with Pathfinder Research, pointed out that it gives Intel and the PC vendors a motive to push customers on upgrades.

"Electronic commerce is a big consumer of processing power," he said.

Tim Clark contributed to this report.