AMD Investors - San Jose Mercury Article on K6-2 Launch
Paul
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mercurycenter.com
Posted at 8:22 p.m. PDT Wednesday, May 27, 1998
New AMD chip breaks from
Intel
BY TOM QUINLAN
Mercury News Staff Writer
Advanced Micro Devices will attempt to escape Intel Corp.'s
long shadow today when it introduces a new processor
''unlike anything Intel has.''
According to analysts and sources familiar with AMD's new
processors, the K6-2 chips and AMD's 3D-Now technology
should provide enough power at a low enough price that
AMD can start moving into the more expensive and lucrative
market for multimedia PCs.
The chips are impressive enough that at least two major PC
manufacturers -- International Business Machines Corp. and
Fujitsu Ltd. -- will announce plans to use the chips in PCs on
Thursday, support AMD was unable to get when it first
announced the K6 line last April.
AMD's ability to help create standards for the industry as a
whole is also getting support from other chip manufacturers
Cyrix Corp. and Integrated Device Technology Inc., who will
add the additional graphics instructions to their
Pentium-compatible processors.
Even Microsoft Corp. has agreed to add support for AMD's
3-D graphics technology to future versions of Windows 98.
''The market ultimately decides how a processor is
regarded, but these are pretty powerful chips,'' said Nathan
Brookwood, a semiconductor analyst for the market research
firm Dataquest Inc.
If the chips prove to be as successful as AMD hopes -- and a
number of observers believe -- the company will not only be
in a position to charge significantly more for its new line, but
also to establish itself as an innovator rather than just a
company that can successfully copy Intel's technology.
The cornerstone of AMD's new processors are faster speeds
-- ranging from 266-MHz to 333-MHz -- and a number of
enhancements designed to make the K6-2 line's multimedia
performance equal to or better than that of Intel's Pentium II
line.
With the K6-2 line, AMD is enhancing the multimedia
performance of its processor line at least nine months before
Intel plans to introduce its own additions to the MMX
instruction set, observers said, giving AMD a chance to eat
away at Intel's overwhelming control of the higher
performance segment of the PC marketplace.
The enhancements in the new line include 21 new
instructions designed to significantly expand the capabilities
of Intel's MMX multimedia extensions, and to support another
graphics enhancement originally developed by Intel, known
as the Accelerated Graphics Port, which lets a computer
transfer 3-D graphics data from place to place faster.
Intel plans to introduce MMX II with a new line of Pentium II
processors -- code named Katmai -- in the first half of 1999,
sources said.
''I think these processors are very capable of competing with
Intel's current Pentium II line,'' said Lynley Gwennap, editor of
the Microprocessor Report, a San Jose-based industry
newsletter. ''What that does is let AMD compete in a much
broader spectrum of the PC industry, and also make more
money.''
Pricing for the chips will range from $185 to $370 in standard
volume purchases of 1,000 chips. While still priced at least
25 percent below Pentium II processors running at the same
speed, it's far more than the roughly $75 to $150 AMD has
been able to charge for the existing K6 line.
It will also give AMD an opportunity to compete in the largest
segment of the PC market, in which systems are priced
between $1,000 and $2,000, sources said.
''Obviously these chips are designed for users where 3-D
graphics are important, like gamers, designers and Internet
users,'' said one source familiar with AMD's plans.
Despite the impressive performance of the chips, however, a
number of factors could derail AMD's plans.
The original K6, or K6 Classic as those chips will now be
called, also won critical praise but AMD was unable to
produce the chips fast enough to take advantage of its
opportunity.
And while Microsoft has promised to support 3D-Now in
Windows 98 -- with enhancements that are scheduled to ship
in July -- the Department of Justice lawsuit against Microsoft
could ultimately derail that operating system.
Although AMD expects that the K6-2 would still offer better
performance than the original K6 even without Windows 98,
the improvement wouldn't be as noticeable on Windows 95.
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