Compaq, CTX International Inc. use K6 chips for notebooks
Double Duty: Visibility Boost, Price Cuts -- AMD takes on
Intel at high, low ends
Kristen Kenedy
Special from Computer Retail Week -- Advanced Micro Devices Inc. is
waging a two-pronged attack against Intel Corp. in the desktop CPU market,
attempting to increase its visibility with high-end business customers while
cutting prices on low-end chips.
Two days after Intel launched the Celeron processor with cache late last
month, AMD unveiled a 350MHz K6-2 chip for high-end desktop systems
and dropped prices of its older K6-2 CPUs below those of the new Celeron.
AMD, based in Sunnyvale, Calif., is working with retailers that serve small
and midsize businesses to develop corporate sales programs, which may
include a special PC SKU based on the K6-2 processor, said David Sheffler,
vice president of North American sales at AMD.
The company has started a program offering early delivery options for its
15,000 authorized resellers, allowing them to receive new CPUs at the same
time as top-tier PC manufacturers.
The chip company also has launched Government Connection, a program to
recruit resellers to take the vendor's processor solutions to federal, state and
local governments (CRN, Sept. 7).
Meanwhile, AMD is taking its message directly to large corporations. AMD
representatives are lobbying IT managers to buy systems with K6-2 CPUs for
offices, said Dana Krelle, vice president of marketing at the computation
products group at AMD.
The company is pushing the 350MHz K6-2 toward business users. The
consumer PC market, on the other hand, is experiencing high growth at the
low end, which has been AMD's stronghold.
Keeping its eye on the consumer space, the vendor reduced the price of
300MHz and 333MHz K6-2 CPUs to beat Intel's Celeron with cache, Krelle
said. The K6-2 previously was priced 25 percent below a comparable
Pentium II CPU but higher than the Celeron.
AMD did not consider the 266MHz and 300MHz Celeron without cache
serious competition because it did not perform up to standards, Krelle said.
Instead, AMD tried to position the K6-2 against the Pentium II.
"Because the [Celeron with cache] is a decent product, we wanted to make
sure we offered a competitive advantage," he said.
AMD will position K6-2 against the Celeron where clock speeds overlap.
Faster K6-2 processors, such as the 350MHz and the upcoming 400MHz
versions, will be priced to compete with the Pentium II, Krelle said.
AMD expects more notebook vendors to support its CPUs this year, Krelle
said. Only Compaq Computer Corp. and CTX International Inc. currently use
K6 chips for notebooks.
AMD is on schedule to provide a 400MHz K6-2 next quarter and the K6-3
either next quarter or in the first quarter of 1999, he said.
Computer Retail Week is a publication of CMP Media Inc.
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CHIP MARKET SNAPSHOT
Intel has long dominated the microprocessor market, but rivals AMD and
Cyrix (now owned by National Semiconductor) continue to fight the good
fight. Here is a sampling of products:
AMD K6-2 WITH 3DNOW
CLOCK SPEED: 350MHz; SYSTEM BUS SPEED: 100MHz; PRICE:
$317
AMD is touting the chip as a competitive performance device. Resellers are
receiving it at the same time as top-tier PC manufacturers.
INTEL PENTIUM II
CLOCK SPEED: 450MHz; SYSTEM BUS SPEED: 100MHz; PRICE:
$669
Intel says the processor is fine for entry-level servers and workstations, as
well as performance and consumer PCs.
INTEL CELERON
CLOCK SPEED: 333MHz; SYSTEM BUS SPEED: 66MHz; PRICE: $192
The addition of 128 Kbytes of Level 2 cache gives Intel's budget processor
some needed 'oomph.'
CYRIX MII
CLOCK SPEED: 333MHz-compatible; SYSTEM BUS SPEED: 83MHz;
PRICE: $188
The chip is aimed at the growing budget-PC market. Cyrix's parent is ramping
up a fab in Maine with plans to phase out a foundry deal with IBM.
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