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To: Stormweaver who wrote (32100)	5/6/1999 12:18:00 PM
From: Francis Matthews	Respond to of 33344

National Semiconductor to announce plans for "PC on a chip" Copyright © 1998 Nando.net Copyright © 1998 Reuters News Service SAN FRANCISCO (April 5, 1998 5:31 p.m. EDT nando.net) - National Semiconductor Corp. Monday plans to announce a way to condense most of the chips used in personal computers into a single chip, which could lower PC prices to less than $500 and lead to a host of new computing devices. National, the country's fourth-largest chip maker, said its new chip will replace a dozen or more separate chips typically found in PCs and combine technologies that it has developed and purchased in recent years. "Everything we have been doing is putting all the pieces together," National's Chief Executive Brian Halla said in an interview. National, based in Santa Clara, Calif., completed a $500 million merger with Cyrix Corp., a maker of Intel Corp.-compatible clone chips, in November, giving it an arsenal of products to create a PC with one chip, excluding system memory. Other key moves included its purchase of Mediamatics in March 1997 for its graphics and television encoding technology and Pico Power in August 1996 for system logic. National said its new chip will lead to even lower priced PCs and other low-cost "information appliances." Halla predicted PC prices could fall to $400 to $500 with National's new chips. "The pricing is up to the PC suppliers, but what we are trying to do is ... put more functionality on the chip by putting more and more intelligence on the chip," he said. Halla will discuss plans for the new chip at a semiconductor industry conference in Phoenix, Ariz., Monday. He said National will have the first working version of its chip by year-end and it could be in volume production by June 1999. Analysts said the new chips were significant and could lead to development of other computing gadgets. "I view it as a progress report. It's not just back of the envelope stuff anymore," said Nathan Brookwood, an analyst at Dataquest Inc., a market research firm in San Jose, Calif. "It requires a lot of chip work but also a lot of software work." "This sub-$500 PC can take the forms of some very consumer friendly devices," said Richard Doherty, director of Envisioneering, a research firm in Seaford, N.Y. "It's the whole PC, not a PC in four packages. That was a very smart decision (for National) to have made a few years ago." National's Cyrix already makes processors that power PCs that sell for less than $1,000. When Compaq Computer Corp. launched its first sub-$1,000 PC in February 1997, a Cyrix processor was inside. Since then, sub-$1,000 PCs have become one of the fastest growing segments of the PC market, using lower-cost Intel clone chips from its rivals National and Advanced Micro Devices Inc. Intel, under pressure because of its lack of a product for that market, is expected to introduce its entry, a family called Celeron, in the next week or so. "I think we are about a year and a half ahead of them," Halla said of Intel, whose chips dominate the PC industry. "I think we have a good plan to stay ahead of them." "You will be surrounded by PCs," Halla said of machines that could use National's new chips. "You will get into your car and say e-mail please, you will have a flat panel display on the wall above your bedroom. It could be impossible to predict what will happen by the year 2000."