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Rise struggles trying to fill Cyrix's shoes

A small, struggling processor startup is aiming to release the first clone of a Pentium II-class chip in the second half of the year, amid a ravaging price war.

A small, struggling processor start-up is aiming to release the first clone of a Pentium II-class chip in the second half of the year, amid a ravaging price war.

Rise Technology, which makes a line of PC processors similar to the Pentium MMX, hopes to bring out a chip that will utilize the same packaging as Intel's low-cost Celeron chip, which comes from the Pentium II generation. The company is also expanding its workforce and seeking additional financing, according to Rise CEO David Lin.

If successful, Rise could become the first company with a product that's interchangeable with Celeron systems and, hence, the Pentium II architecture. National Semiconductor has been working on a Celeron-compatible chip but recently said it will sell its Cyrix processor division, putting the chip's fate in question.

But some clouds loom in this market. Rise is having trouble getting a firm footing in the PC chip business while prices for processors dive.

Sources say that Rise has recently had difficulty meeting its payroll. "I will not comment on internal matters," Lin said.

Like other companies, Rise is struggling with the difficult conditions that characterize the PC processor market, even as it hopes for a breakthrough. AMD has been suffering financial losses while reportedly gaining market share, and National was losing money on Cyrix for the past few quarters, according to executives at the company.

More recently, IDT, which manufactures the WinChip family of low-cost PC processors, acknowledged that it can't operate on its own. The company is currently looking for a "partner" that will provide financial backing.

Now comes a report that Intel's share is increasing and that it's the only company making any money.

"We estimate that Intel shipped about 23 million processors in the [first] quarter, for a unit share of 79 percent, up from 72 percent in the fourth quarter of '98," Michael Slater, founder of MicroDesign Resources, wrote in a recent issue of The Microprocessor Report.

"Intel's share of the business was 92 percent," Slater continued, "and when it comes to profits, Intel was the only x86 vendor to have any." x86 refers to the Pentium architecture.

Still, the low-cost PC phenomenon has boosted PC unit sales and opened the door for companies to manufacture Intel-like processors.

The sub-$600 PC market presents a "tremendous opportunity," especially with National Semiconductor out of the picture, Lin said. Rise supplies relatively unknown PC makers in Asia, and expects that it will be supplying many of its chips to PCs that are priced at $299 or $399.

"We are going through major financing for our product ramp," he said, adding: "We are recruiting people like crazy."

After National Semi said it was pulling out the PC processor business earlier this month, Rise began to get inquiries from former Cyrix people, he said.

But while pricing is difficult for everyone, Rise faces an additional problem, Slater said. The company's chip is relatively large, which raises costs.

Rise has other critics too. "Personally, I think they're in so much trouble that they're desperately trying to create public awareness, through the press, in the hopes that they'll drum up business," said one industry source who has been following Rise.

However, the company that manufactures the chips for Rise, its so-called foundry partner, has "strong patent cross licensing" with Intel, Lin said, which allows the company to make the chips without fear of legal reprisals from Intel.

The company will announce a new roadmap for its processors later this month before the Computex trade show in Taiwan, a spokeswoman said.

Rise's current family of chips, called the mP6, are essentially low-voltage Pentium MMX chips for PCs under $600. The upcoming mP6 II will come in the Celeron's "Socket 370" package and contain extra cache memory integrated into the chip, according to a report from MicroDesign Resources. Rise demonstrated mP6II at the CeBit trade show earlier this year.

In the more immediate future, Rise will launch 240- and 250-MHz versions of its processors. The company rates them at "PR 333" and "PR 366," claiming performance is equivalent to Intel-compatible chips that run at those speeds.

Lin said these are expected to hit volume production in July.

Rise began to ship its first products in volume in December of last year and shipped "less than 50,000" in the first quarter, Lin said. Some industry sources familiar with Rise put this figure far below this total.