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To: Bryan Steffen who wrote (16397)	4/7/1998 3:59:00 PM
From: Walt Street	Respond to of 25960

Bryan, I don't think older (slower) processors are going to push the need for speed aside. A price reduction of these processors is only expanding the total PC market, to include more FIRST PCs in homes. It does not mean less volume in the faster chips. I personally see it as a plus, because it will create more PC users (even if they are running first generation Pentiums.) This can only help make the inevitable upgrades to .18, .13 or faster chips larger scale. JMHO Walter

To: Bryan Steffen who wrote (16397)	4/7/1998 4:01:00 PM
From: FJB	Read Replies (1) \| Respond to of 25960

RE:Then how do you explain sub-$1000 computers with Pentium 166 or 200 mhz processors? They have been out for quite some time. I have not and don't track the life of different processors in the market, but my perception is that they are staying around longer. It just so happens I track processor lives and prices very closely. And you are correct, the P55C 166MHz and 200MHz have stuck around longer than planned(although the 166MHz SKU is getting scarce and 200MHz is the entry level now). The simple reason for this is that Intel was unprepared for the sub-$1000 phenomenon and serving up these older models up was the only way they could respond. This has changed however and they have acknowledged the market. Intel has created another stop gap measure for this market called Celeron, which is simply a 0.35 PII with the L2 cache removed, but its performance is not that great because of the absent L2. Their real response in this market comes in Q4 with Mendocino which will have a 128KB on board L2 cache. How can they get 128KB on this die without making it too large too manufacture? That's right, it's got to be made on a 0.25um process or better. Again, this means they have to go 0.25um or 0.18um as quickly possible to be competitive at the low-end. RE:Besides, Computer manufacturers are offering the sub-$1000 with older processors. Plain and simple because they are cheaper. To reach greater penetration levels of PCs into homes, you've got to offer cheaper PCs. Cheaper PCs mean older processors. Regardless of smaller die cuts no manufacturer will be able to offer a 333 mhz pentium or whatever is the newest fastest chip available for under $1000. Next quarter, 233MHz will be the slowest systems offered at $799 price points. AMD's 0.25 266MHz K6 and Celeron at 266MHz will be in $999 systems. We are TWO quarters away from 333MHz being sub-$1000. Yeah, noone will offer the newest fastest chip at under $1K, but to remain competitive at sub-$1000 will mean 0.25um or better processes. Another approach to very inexpensive systems is system-on-a-chip, but these REQUIRE 0.18 or better and are still a ways off. RE:Chip makers and computer manufacturers will use slower processors longer. That is my main argument. Correspondingly, chip makers won't roll out smaller architectures as fast. AMD, Intel, IDTI, IBM, National, etc. are moving ahead faster than ever. This is a fact. Look at their process technology roadmaps. They all plan to be doing volume production on 0.18 by the end of next year. Competition requires they do so. The move to 0.25 among entry level MPU vendors is almost desperate. They can't get there fast enough.