Ronald, Article...Intel gets a new competitor...
usatoday.com
Intel may face new challenger
From: Ziff Davis News Network
Move over Andy Grove. A Silicon Valley chip maker is about to challenge mighty Intel on its home turf. It plans on entering the $19.6 billion X86 market with a low-cost microprocessor tailored for entry-level PCs, ZDNN has learned.
Industry sources say the chip was designed and will be manufactured by Integrated Device Technologies, of Santa Clara, Calif., a maker of embedded RISC processors, specialized memory and networking chips, which earned $118 million on sales of $679.5 million in its last fiscal year.
The new chip will apparently be manufactured at IDT'S new, $500 million foundry in Hillsboro, Ore., -- within sight of a major Intel research facility. It was designed by a team led by industry pioneer Glenn Henry, a one-time IBM fellow who is now president of Centaur Technologies, an Austin, Texas, subsidiary of IDT.
IDT officials were not willing to comment -- or even confirm -- the existence of the new chip. But they are expected to announce their plans next month at PC Tech Forum, an industry conference sponsored by MicroDesign Resources. MDR has said publicly that an unidentified company will announce a new X86 chip at the conference, but has declined to identify it or comment on IDT's plans.
Analyst reaction to the news was mixed. Charles Boucher, who follows IDT for UBS Securities, was unimpressed. "I don't know why they think they can succeed," he said. "There are already two able Intel competitors (Advanced Micro Devices and Cyrix)" in the market he said. Other contenders for a piece of the X86 market, including Texas Instruments and United Microelectronics Corp., tried and failed to compete with Intel.
One source familiar with the project said IDT has found a way to significantly reduce the size of the chip. That means more chips can be produced for less money. "It's a highly streamlined design," he said. Another source who has seen the design, called it "the leanest, meanest X86 you can make." The chip, sources said, will probably be targeted at the burgeoning market for entry-level computers in Asia, where Intel's brand name has much less clout than in the United States.
Moreover, said one analyst, "the company has modest expectations. It isn't trying to beat Intel. It just wants a small piece of the market." Last year, total sales of X86 processors for the computer market reached $15.4 billion and Intel owned more than 90% of it, according to Dataquest. This year, sales are expected to grow to $19.6 billion. So even a small percentage of that market is significant. "This pot of gold is too big to ignore," said Dataquest analyst Nathan Brookwood.
But grabbing the gold could be very difficult. One obstacle: a lawsuit. Unless IDT holds rights to the relevant patents -- or is indisputably on an independent design path -- it is likely to face expensive legal action by Intel. Another: convincing a PC maker to take a chance on a new player.
Nevertheless, analyst Mark Kirstein of In-Stat, a market research firm in Scottsdale, Ariz., said Intel has inadvertently given its competitors an opening. The giant chipmaker's decision to place its chips on a daughter card (instead of just plugging them into a socket on the motherboard) creates "an 18-month window to exploit the changeover," he said. PC makers may be even more open to alternative vendors whose chips fit into their current motherboard designs. But after that, the existing socket designs will be obsolete. IDT, and the other competitors, will need to develop an alternative to Intel's design. "They'll need to get together to have enough mass to support an alternative infrastructure," he said.
Despite the difficulty, at least one additional company is expected to announce an X86 some time this year. And at least a dozen other design teams -- some in start-ups, others in established semiconductor companies -- are experimenting with X86 designs, said a Silicon Valley venture capitalist. For them, he says, the market is just too tempting to ignore.
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Huh! some appreciation for putting all those SRAM chips on our motherboards. :-)
Ronald if you keep yelling at us I'm gonna go deaf. <gg>
Michael |
