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PC makers likely to veer from Rambus

Intel is set to ship its 845 chipset, which means Pentium 4 systems will be able to use SDRAM rather than the costlier Rambus memory.

SAN JOSE, Calif.--PC makers may be packing their latest Pentium 4 computers with memory based on designs from Rambus, but the picture will change in a very short time.

In about two weeks, Intel will release its 845 chipset, which will let PC makers combine Pentium 4 processors with standard computer memory, or SDRAM, for the first time. Although SDRAM-based computers won't provide the same level of performance as those filled with Rambus memory, they will likely be much more popular, say executives and analysts.

"The 845 (chipset) delivers the stable mainstream platform," Louis Burns, vice president of the desktop platform group at Intel, said in a speech at the Intel Developer Forum here. Computers containing the chipset will come out in the price range "where the majority of businesses will be buying," he added.

Using SDRAM can cut from $150 to $200 off the retail price of a PC, according to various executives and analysts at the forum.

Lower prices are a key part of Intel's effort to move its Pentium 4 processor into the mainstream of corporate and consumer computing. Sales of the chip lagged after its introduction at the end of last year, at least in part because of its connection with Rambus memory and the associated higher costs.

This week, Intel heralded a new wave of Pentium 4-based systems when it officially announced a version of the chip that broke the 2GHz barrier and slashed prices of earlier versions of the chip.

"The 845 is going to be extremely popular. There is still a price gap between RDRAM (Rambus memory) and SDRAM," said Willy Kok, product manager at Acer. The prices of upcoming PCs "will definitely be lower, based on the memory costs alone," he said.

Acer, for instance, released on Monday a 2GHz Pentium 4 system for $999 without monitor. A similar model with SDRAM will follow in the near future and will be priced lower, he added. Intel has said that Pentium 4 computers selling for $800 will appear this year.

"You can probably save about $150 on the bill of materials. That could translate into a street price (savings) of $175," said Nathan Brookwood, an analyst at Insight 64. Not only is SDRAM cheaper than RDRAM, but the motherboards, which hold the main circuitry of a PC, are cheaper too.

Right now, Rambus is the only option when it comes to building Pentium 4 computers, and Intel has released chipsets for the Pentium 4 that work with RDRAM. Via Technologies recently announced a chipset that lets manufacturers connect a Pentium 4 to DDR DRAM, a fast version of SDRAM, but Intel has threatened to sue the company over the chipset.

Intel will come out with a version of the 845 that works with DDR DRAM in the first part of 2002. Later that year, it will follow up with a DDR DRAM chipset for the Pentium 4 containing integrated graphics, said Burns. This will cut costs even more.

In addition, Intel last month began to cut back on the subsidies it offered to PC makers using RDRAM.

Go for what you know
Familiarity is another strike against Rambus, according to Peter Glaskowsky, an analyst at MicroDesign Resources. IT managers understand SDRAM. By contrast, RDRAM remains relatively unknown. Typically, IT managers are conservative and tend to buy the tried-and-true technology.

"It gives IT managers something they are more comfortable with," said Paul Collas, director of product marketing at Gateway.

For reasons of cost and comfort, Rambus will be "squeezed into a small market," Glaskowsky said.

Rambus was not immediately available for comment.

In terms of performance, a Pentium 4 with SDRAM will be relatively unspectacular, according to Glaskowsky. Brookwood disagreed, saying that a 2GHz Pentium 4 with SDRAM will likely come close to a 1.9GHz with RDRAM.

Tom Quinn, vice president of marketing at Samsung, said that the price difference between Rambus and regular memory is actually shrinking. A 1.5-GHz Pentium 4 with Rambus will provide superior performance to a 1.7-GHz with SDRAM but cost about the same, he maintained.

The slant toward standard memory also shows in the current plans of contract manufacturers. Currently, there are about 200 different PC designs being prepared at Taiwanese contract manufacturers, said Jeff McCrea, director of Intel desktop-platform marketing.

McCrea wouldn't specify how many active Rambus-based PC designs these companies are working on, but he said the number was "less" than that of other designs.

A shift from Rambus would also lead to smaller computers. Right now, nearly all Pentium 4 computers come in large, bulky minitowers. Some PC manufacturers, however, will likely come out with smaller "microtower" PCs after the 845 debuts.

Microtowers are generally associated with the budget market, said Gateway's Collas. Manufacturers don't want to put a Rambus-based PC in the small boxes because it would send a mixed message. Computers with the 845 chipset won't be bound by the constraint.

"The 845 chipset will enable a more mainstream design," he said.

Also, Intel in the fourth quarter will shift from a 180-nanometer process to a 130-nanometer process for making the chip. Shifting the manufacturing will reduce the heat produced by the chips and hence allow PC makers to get away with putting in less insulation, sources said.