Intel, AMD ready fast chips at 600 Mhz...
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Intel, AMD ready fast chips at 600 MHz
By Brooke Crothers and Michael Kanellos
Staff Writers, CNET News.com
July 27, 1999, 11:10 a.m. PT
The two leading PC chipmakers will unveil high-performance processors that will
hit new speed levels for the mass market in the next two weeks.
Intel, the world's largest chip manufacturer, on Monday will release its fastest Pentium III
and Celeron processors, which will reach 600 MHz and 500 MHz respectively. The
following week, the first computers built around the new Athlon processor from rival
chipmaker AMD--formerly called the K7--will appear on the market at competitive speeds,
sources say.
In a ritual that seems to occur almost monthly now, PC
makers will line up Monday as Intel announces its latest
processors. New Pentium III computers should hit the
$1,800-$2,000 PC range, analysts say, while the new
Celeron chips will be targeted at the thriving market under
$1,000. Intel will also cut prices on Celeron chips.
The systems are coming for the back-to-school buying
season, the second biggest purchasing period of the year.
The Pentium III is designed for performance computers while
the Celeron is made for cheaper systems. The two chips are
actually built around the same processor technology but
differ in speed, price, and other features such as multimedia
processing power.
IBM, Compaq Computer, and Gateway, among others, are
expected to announce models with the new Pentium III and
Celeron chips, while IBM, Compaq, and others are expected
to come out with new PCs based on AMD's chip later in the
month.
IBM, for instance, will launch new Pentium III business desktops along with an
Internet-based "e-support" program called "PC Lifecycle Care" which gives customers
guidance on upgrades, according to sources familiar with the plan. Big Blue will also
introduce new workstations based on the chip.
Gateway systems featuring the new Pentium III should start at around $2,199 with a
monitor and ISP contract, while Compaq boxes should be priced around $1,799 with
rebates, according to sources.
Intel's release of the 600-MHz Pentium III next week will allow the company to retain the
speed crown. "The consumer market, where [AMD's] Athlon will initially appear, seems
largely driven by speed and price. So the fact that Intel has [the new Pentium III] will
prevent the appearance that AMD has higher-performing products in the consumer
segment," said Mike Feibus, a principal at Mercury Research.
"That's important for Intel going forward to prevent that perception from taking hold," he
added. Athlon will run at speeds up to 600 MHz upon release, although analysts have
questioned how many AMD can produce in the early months of the chip's life.
Price cuts loom
Intel earlier this month cut prices by 12 to 14 percent on the Pentium III line to make room
for the new chip. Intel will impose another round of price cuts August 22. The 600-MHz
Pentium III is expected to hit the market at $669 in volume.
The 500-MHz Celeron will be priced at $167, and other Celeron chips will be cut in price
the day it arrives. The 466-MHz version will
drop from $147 to $114, while the
433-MHz chip will go from $113 to $93.
The 400-MHz Celeron will be discounted
from $93 to $73, and the 366-MHz and
333-MHz versions will stay roughly stable
at $69 and $67 respectively, according to
sources.
The listed prices are for volume purchases.
Actual retail price will vary considerably
depending upon supply.
The Pentium III has been fairly widely
accepted in corporate accounts, among
higher-end "performance" users, and in foreign retail outlets, said Paul Otellini, general
manager of the Intel Architecture Business group.
Developers have also begun to increase their efforts in support of the chip. About 200 Web
sites and applications are optimized for the Pentium III at present. Five hundred are
expected by the end of the year.
Where the Pentium III lags is in the U.S. retail market, where buyers have been drawn to
super-cheap PC offers, Otellini admitted. Nonetheless, Celeron has been gaining
ground in that segment.
Cheap PCs have also expanded the market a bit. "In the consumer space, there is
some evidence that the $399 and $499 stuff is attracting more buyers than is the
case historically," he said.
For computer enthusiasts and high-end users, looking for additional speed
increases beyond the processor, other changes will come later. The 600-MHz
Pentium III will initially employ the 100-MHz system bus. A bus serves as a conduit
between the processor and main memory. A faster 133-MHz bus, which will improve
performance, will appear in September.
News.com's Joe Wilcox contributed to this report.
Related news stories
• Intel cuts Pentium III prices July 19, 1999
• AMD names K7 Athlon, expects massive losses June 24, 1999
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