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Technology Stocks : Compaq

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To: hlpinout who wrote (46406)9/25/1999 3:23:00 PM
From: hlpinout  Read Replies (1) of 97611
 
Online News, 09/24/99 03:48 PM)

Intel delays launch of high-end PC
chip set
By Tom Spring, PC World

In a last-minute change of plans, Intel Corp. has postponed
the launch of its highest-performance PC chip set,
previously scheduled for Monday.

Calling system vendors last night, Intel acknowledged
memory problems associated with the Rambus memory
design in its 820 chip set. Intel reportedly found a
"memory-bit error" that curtails top memory capacity and
speed.

The stumble will impact high-end computers designed to
run the fastest Pentium III processors. In this niche,
"everybody is going to be reeling: Compaq, IBM, Hewlett
Packard, Dell and Gateway," said Kevin Knox, Gartner
Group Inc. research director.

The Intel 820 system chip sets support a faster system bus
(133 MHz vs. 100 MHz) and 4X Accelerated Graphics Ports
(AGP) as well as Rambus DRAM (RDRAM) and other
memory architectures.

Rambus is the company that designed and licensed
RDRAM technology to memory manufacturers. The 820
chip set is expected to boost memory speeds as high as
800 MHz.

Compaq was contacted late Thursday by Intel and told that
the 820 chip set was flawed. Compaq had planned to
announce a line of DeskPros, scheduled to be available
next month, but those plans have been postponed, says
Compaq public relations manager Jim Cortese.

"Intel contacted us and said it was experiencing technical
problems with their 820 chip set," Cortese says. "That's all
we were told."

Some observers have speculated that system vendors may
need to rebuild large numbers of PCs or ship them with
performance limitations. But Compaq doesn't face that
problem because the final chip sets haven't yet arrived,
Cortese says.


IDC's Knox says Intel's misstep will rock already
contentious relations between Intel and PC makers who
have been bickering over the pricey 820 chip set. "We might
see a lot of computer makers going with alternative chip set
makers," Knox said.

Micron has already made that move -- its next-generation
computer platform won't be based on Intel's upcoming 820
system chip set, but rather a VIA Technologies alternative.
The move, Micron says, will save customers between $200
to $300 over systems with the 820 chip set, without
sacrificing system performance.

While the 820 delay is major news for customers
demanding absolutely peak performance, it is a nonevent
for most customers, Knox said.

"Nobody was betting on the 820 being the leading chip set
for another six months," he says, since conventional
systems offer plenty of horsepower for most applications.

Vendors will proceed with plans to announce lower-cost
systems based on Intel's 810e chip set on Monday.

This silicon targets budget Pentium III PCs. Like the existing
810 chip set for Celeron systems, it integrates adequate but
not stellar AGP graphics to save cost. The 810e doesn't
support RDRAM, and you can't upgrade graphics later. It
supports a 133-MHZ or older system bus, PC-100 memory
and UltraDMA/66 hard drives.

(Additional reporting by Yardena Arar.)

For more PC news, visit PC World Online. Story copyright
PC World Communications.
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