Sunday June 6 1:21 PM ET
S3 To Launch Graphics Chips For Notebook Computers
SAN FRANCISCO (Reuters) - S3 Inc. (Nasdaq:SIII - news), a maker of computer graphics chips, will announce
Monday two new chips for the portable PC market that will enable both video gamers and business users to have
better graphics on the road.
S3 will announce two new versions of its popular Savage graphics accelerator chip, called the Savage/MX and Savage/IX, in its
latest bid to regain lost share of the graphics market.
The new chips will provide faster and more realistic three-dimensional graphics for notebooks, where so far the market for graphics
is smaller than desktop PCs. Graphics chips usually consume more power, a key issue in mobile computing.
''We have a very low power-consuming product,'' said Kenneth Potashner, president, CEO and chairman of S3, adding that many
video games, such as Quake, which could not previously run well on notebooks, will now run three times faster.
In February, the Santa Clara, Calif.-based company announced a new graphics chip called the Savage4, in a major comeback
attempt for the company, which once lead the desktop graphics chip market. It now has many major customers for this chip,
including three of the top five PC makers like IBM Corp.
''A company that was under pressure and stress now has a path to success with the Savage chip,'' Potashner, who joined S3 last
November, said. ''This announcement is the next phase of that. We are now going to expand it to the notebook market.''
Currently, some of the main contenders in the estimated $430 million portable graphics chip market are NeoMagic Corp.
(Nasdaq:NMGC - news) and ATI Technologies Inc. (Nasdaq:ATYT - news)
''We have gone from an uninteresting portable accelerator market to a much more competitive market this year,'' said Dean
McCarron, an analyst at Mercury Research in Scottsdale, Ariz.
Potashner said that S3 expects to begin producing its new Savage chips in the third quarter, with volume production in the fourth
quarter of this year.
''Once we are in volume (mobile) should constitute 20-25 percent of our total revenue base,'' he said.
Savage/MX will be priced at $42, and Savage/IX is priced at $49 for a four megabyte version, $56 for an eight megabyte version and
$68 for a 16 megabyte version, all in quantities of 1,000 units.
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