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To: The Prophet who wrote (42207)	5/15/2000 10:36:00 AM
From: Don Green	Read Replies (1) \| Respond to of 93625

PC Makers Await Direction After Intel Recall (05/15/00, 9:26 a.m. ET) By Mark Hachman and Faith Hung, Electronic Buyers' News It's no Pentium bug, but Intel's recall of selected motherboards has customers waiting and wondering how quickly the company will correct the snafu. While the number of affected components is relatively small, the recall will impose modest adjustments on the PC supply chain and white-box assemblers, according to observers. For now, OEMs and resellers are being asked to sit on their product inventory while logistical details are worked out. The recall came Wednesday when Intel (stock: INTC) revealed that certain motherboards shipping with the 820 chip set could intermittently reboot or hang up. The boards are equipped with a Memory Translator Hub (MTH) that enables the 820 chip set to communicate with SDRAM. The MTH component was identified as containing the glitch, Intel said. A higher-speed motherboard configuration, which includes the 820 chip set and Direct Rambus DRAM, doesn't require the MTH component and has experienced no performance problems, the company said. As of late Friday, Intel's plan included an offer to take back the faulty MTH chip and replace the associated SDRAM on the motherboards with more expensive Direct RDRAM. The recompense could cost the chip giant several hundred million dollars, according to analysts. Intel may have to foot shipping and warehousing charges, as well as costs associated with component replacement. And in the short term, Intel will have to deal with another slight to its chip set program amid growing competition from rivals like Advanced Micro Devices (stock: AMD) and Taiwan's Via Technologies. "There have been a number of technology screw-ups, and the 820 chip set issue's just been another one," said Terry Ragsdale, an analyst at J.P. Morgan Securities, New York. But Ragsdale and other analysts also said handled correctly, the impact of the MTH bug is likely to be minimal. Because MTH-equipped boards are a subset -- albeit a large one -- of the motherboard line that includes the 820 chip set, the bug should be less serious than the infamous Pentium bug Intel discovered in 1994, which affected all PCs regardless of chip set or memory type. Additional reporting by Jack Robertson and Jennifer Baljko Shah