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Servers use fastest Pentium II

Major computer makers will announce new Pentium II servers in conjunction with Intel's introduction of new high-speed processors.

Major server manufacturers like IBM, Hewlett-Packard, Gateway 2000, and NEC will announce new Pentium II servers in conjunction with Intel's introduction of new high-speed processors Wednesday, offering more powerful systems at a lower price.

Intel will announce new Pentium II chips running at 350 MHz and 400 MHz, in addition to a new 266-MHz chip called Celeron that's aimed at TV set-top boxes and sub-$1,000 PCs.

Major server computer manufacturers are expected to immediately update systems from the aging 200-MHz Pentium Pro chip, which Intel is phasing out, to faster chips.

IBM plans to announce its Netfinity 3000 line of Pentium II servers, company sources said. The new entry-level servers will ship with either a single 266-MHz, 300-MHz, or 350-MHz Pentium II. The Netfinity 3000 will come with an optional hard drive, and will start at around $1,700.

NEC will roll out its LS2400 workgroup server. The system will come with one or two Pentium II processors running at 350 MHz or 400 MHz, depending on the configuration. Memory will range from 32MB to 1GB. The server can also accommodate as many as four 9GB hard drives. The minimum configuration will cost less than $4,000, sources close to NEC said.

Gateway 2000 will introduce two new lines of servers that will be co-branded with the Advanced Logic Research (ALR) name, according to industry sources. Prices on the new 7200 and 8200 series servers will start at $3,399 for a 350-MHz Pentium II system with the new chipset, 64MB of memory, a 4GB high peformance hard disk drive, and built-in networking capabilities. Both systems will be dual-processor capable.

Hewlett-Packard is expected to announce new Pentium II servers which will be released in May, sources said. The new systems will be available in rack and tower versions.

Servers with the Pentium II processors will be both more powerful and less expensive than previous models based on the Pentium Pro chip, analysts say.

For starters, the Pentium Pro chip still sells for close to $2,000, far more than any other Intel processor. Unlike the Pentium II chips, the Pentium Pro has not been steeply discounted by the company, a situation that some have attributed to the fact that it is a product that does not face competition from other X86 chips.

By contrast, the forthcoming 350-MHz and 400-MHz chips will cost under $1,000 in quantity, which in turn will drive down the cost of servers.

Computer makers will also take advantage of rapidly dropping memory prices. Oversupply and unstable Asian currencies have devalued 16-bit and 64-bit memory prices to near manufacturer costs.

The chief performance benefit comes from the 100-MHz bus, executives and analysts say. Until now, Intel processors used a 66-MHz system bus, which effectively put limits on the speed that data traveled between the processor and main memory. Although Intel has been boosting the speed of its processors for years, the system bus speed has been stuck at 66-MHz for some time, thereby making the bus a bottleneck.

"Clearly, the old bus was a problem," one observer said.

The new bus is implemented in the BX 440 chipset from Intel, which will also be released Wednesday. Further, Intel is increasing the amount of extra "L2" cache memory from 512K to 1MB. The L2 cache memory acts as a data reservoir for the processor. The larger the cache, the better the performance.

"We think there is probably a 10 to 12 percent increase in performance improvement at the system level," said one executive at a server company.

In June, Intel will bring out chips based on the next-generation Slot-2 architecture which will support eight-processor systems.

Senior writer Michael Kanellos contributed to this report.