Intel drops bomb on AMD

Intel is prepping to go another round with Advanced Micro Devices in a battle that should ultimately benefit the consumer. The Santa Clara California, chip maker, Monday rang the bell on this latest round with rival AMD, by announcing it is now shipping 750MHz and 800MHz Pentium III chips.

The 750MHz Pentium III chip was expected in January. The 800MHz Pentium III, however, comes a full two months before it was originally expected.

This, analysts say, is a response to mounting pressure from AMD. The move, in fact, is the latest in a series of jabs between Intel and AMD, which began when AMD announced its Athlon processor at speeds of up to 650MHz, August 8.

The boxing match will only benefit consumers, analyst say.

And the winner is ... "Pick your sides and cheer," said Mike Feibus, principle at market research firm Mercury Resources Inc. "The thing that no buyer wants to see, here, is a knock out punch. Instead, what they want to see is a long knock down, drag out match."

That's because as Intel and AMD battle it out, each company will push hard to be first with the fastest chip. The result will be that PC buyers get more power more quickly than they would normally and, at the same time, prices on existing processors will drop more quickly.

Since August AMD and Intel have battled back and forth on top speeds. AMD beating Intel to 700MHz October and 750MHz in November. But Intel made it first to 733MHz and 800MHz.

AMD, however, won't be very far behind. The company will launch its 800MHz Athlon early in January, possibly at the Consumer Electronics Show. PC makers Compaq and IBM are expected to support it.

"We've been sampling customers to support a January launch with (PCs) available in January," said AMD spokesman Drew Prairie. "What you will likely see on Monday are some reviews posted on our 800MHz part."

While the two companies have been fairly close in their introductions of new processors, Intel says it is about to step it up and offer new desktop Pentium III chips sooner than expected before.

"We have made a shift with this product line," said Jeff McCrea, director of marketing for Intel's Desktop Products Group. "The world is working on Internet time. We've decided to get (800MHz) into the market place as soon as possible.

Because of this, "You're going to see Intel being much more aggressive in the future," he added.

The 800MHz Pentium III chip will be available in limited quantities at launch, while the 750MHz should be available in quantity, McCrea said.

While Intel may try to end the fight with a knockout punch, PC buyers don't want to see a knockout, analysts say. At least not yet.

With both companies approaching 800MHz, the climb 1,000MHz or 1GHz should happen fairly quickly.

It's still up in the air as to who will get there first, but that first 1GHz announcement isn't that far off.

AMD and Intel have both said they expect to have 1GHz chips in the second half of next year. "The way things are being pulled in ... there's no way it will be back to school. It will be sooner," Fiebus said. Possibly as soon as June, he said.

AMD would not comment on whether or not it is sampling 1GHz chips presently to large OEMs.

Sources at the company it hasn't yet. But it should happen soon. AMD will show off a 900MHz Athlon at the Consumer Electronics Show. "We will continue to build upon the success we've seen with Athon with future derivative products that keep us in the performance lead," the AMD spokesman said.

Intel, for its part, plans to disclose a paper on a 1GHz Pentium III chip at February's IEEE International Solid-State Circuits Conference. The company also has plans to deliver a 1GHz and faster chip, code-named Willamette in the second half of next year.