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Technology Stocks : IDTI - an IC Play on Growth Markets -- Ignore unavailable to you. Want to Upgrade?

To: Edward Leinbach who wrote (7119)	3/3/1998 3:28:00 AM
From: flickerful	Read Replies (2) \| Respond to of 11555

Techno Babble: The WinChip By Stephen Lavedas - 3/02/98 To date, the only competitors Intel (INTC) has faced in the arena of CPU sales are Cyrix (recently bought by National Semiconductor Corporation (NSM), and Advanced Micro Devices (AMD) (now turning to IBM to keep up with the demand for its popular K6 chip). If Centaur Technology, Inc. has its way however, a third major competitor might emerge to join the ranks. Centaur Technology is a wholly owned subsidiary of Integrated Device Technology, Inc. (IDTI) and their WinChip processor series might break into the crowded processor industry. Intel is the dominant force in the processor industry. In the past, upstarts (Cyrix and AMD) would release their equivalent CPU products well after Intel's were introduced. When the Pentium was released though, AMD and Cyrix caught up. Cyrix released its 5x86 and 6x86 series of processors almost concurrently, boasting superior performance (the 133Mhz chip benchmarked at the Pentium 166 level) and total compatibility. While time showed that the Cyrix chip lacked some compatibility and the FPU (floating point unit) was quite a bit slower, for business' applications the chip ran well and was priced below it's Intel cousin. The AMD chip showed similar performance (though it had a later release) and also carved itself a niche in the high-end market. Even though Centaur Technology is entering the field late with its low end C6 (P200MMX) chip, Centaur's future C6+ 'WinChip' is promising and could successfully compete in the laptop and mid-range computer markets. Intel uses the x86 instruction set for its processors; logically enough, Cyrix and AMD do as well. Centaur, however, translates x86 instructions for its processor. Intel, Cyrix and AMD use CISC (complex instruction set computing) architectures, but Centaur uses RISC (reduced instruction set computing) architecture, the same architecture used in PowerPC's. The main advantage of this architecture is its simplicity. This simplicity has allowed Centaur to create a cooler, less power hungry chip. This also allows Centaur to promise rapid processor upgrading. This last feature may prove to be the most important. The low-end CPU market is already dominated by inexpensive processors, and an unknown chip with a ten dollar cost advantage is likely to be ignored. The way to break into the processor market is to make a mid-to-high end CPU that offers significant savings. The currently available C6 WinChip supports MMX and is available in both 180 and 200Mhz varieties. The chip core is a RISC processor, but Centaur uses a hardware translator to convert x86 instructions into instructions the CPU core understands. Rather than executing multiple instructions at once, the CPU executes one instruction at a time at very high speeds. Centaur has been able to achieve competitive speeds. RAM access is avoided in favor of the much faster L1 cacheL1 cache, which reduces data bottlenecks. The overall size of the processor die (88mm) is much smaller than the competitors, which diminishes electron travel time (yes this does actually make a noticeable difference). Also significant, the 200Mhz WinChip uses roughly two-thirds the power of the Pentium 200MMX. This cut in power usage will, for example, allow laptop batteries to last longer on a single charge. There are, however, some downsides to this chip. The floating point operation speed is even slower than that of the Cyrix chip, a fact which has a negative effect on its appeal to gamers. At the moment, only the 180 and 200Mhz versions are available, relegating the C6 to the low-end market. The other problem is its lack of visibility. Almost no one has heard of this chip. If IDT plans to force its way into the CPU market, some serious advertising is going to be needed, but it is possible that IDT is biding its time until it has a more advanced line. The C6+ WinChip, announced in October '97, could work to resolve the shortcomings of the now available C6. It promises better floating point and integer math as well as better MMX performance. 3D graphics performance will be increased by adding a second MMX unit to the chip, as well as 53 new instructions. This all comes with only a very small increase in die size (3 mm larger to 91mm) which means this chip will maintain the advantages of the original C6. The C6+ chips should be available in the first half of 1998 at 266Mhz clock speeds, with 300Mhz versions available in the second half of '98 (Centaur expects to get up to 400Mhz clock speeds from the C6 architecture). It may be that IDT is holding off advertising until these processors are out, with business performance comparable to the other P200MMX CPU's, some exposure should only aid their cause. A more reasonable explanation as to why the chip has not been promoted could be IDT's limited capacity to produce the chips. With veteran AMD turning to IBM to increase their capacity, it would be surprising if this newcomer had the facilities to keep up with demand. If the C6+ increased floating point performance and the processors are priced at or below the AMD and Cyrix prices, it may become the popular new alternative. As end users, we can only hope that that they succeed in this market and up the ante. ragingbull.com

To: Edward Leinbach who wrote (7119)	3/3/1998 4:37:00 PM
From: Steve Lewis	Read Replies (2) \| Respond to of 11555

Regarding: <It might be better to chart this stock from Feb 10 th forward , that was the break out day . Average volume is about 3 mil with a low of 12 15/16 & high of 16 1/2 . We are just about smack dab in the middle now.> I think you are on the right track. It's interesting that the analyst Kurlak (MLynch) is bashing the PC & semi world (through this summer and fall, dejavu-1996) and MLynch owns a big chunk of IDTI. He seems to continuing his bearish view on the tech sector which, if he followed his own advice, he & his clients missed out on the Jan/Feb upswing. Maybe with the "big & vocal" bears and Asia we have our "wall of worry" to climb. I'm not into semi equipment companies at this time but am persuaded by the view expressed by Lehman & others that the supply-demand dynamic in chips will improve with reduced supply coming from Asia in the next 12-18 months.