Gateway hints at AMD chip supply deal

Scarcity of Intel chips could turn Gateway to rival chipmaker

Sources at Gateway have strongly indicated that it may soon sign a deal to provide PCs with AMD chips after today revealing that its fourth quarter revenues reflect the lack of availability of Intel products.

A scarcity of Intel products combined with the success of the AMD Athlon processor and concerns over the architecture of certain Intel products caused some industry experts recently to speculate that Gateway might snub long-term favourite Intel by choosing to supply PCs with Athlon and other high-end AMD chips in place of Intel ones.

Today's announcement of poor fourth quarter returns indicates that a deal could soon be struck.

Mike Maloney, director of Gateway consumer products for Europe, middle east and Africa drops a heavy hint that Gateway could soon be selling PCs with Athlon and other AMD chips: "After the announcement to Wall Street, it's been clearly indicated that we've been looking at other suppliers. I wouldn't discount it. Although we're always looking at different suppliers and I can't comment on a specific case."

AMD has itself, however, been keen to play down speculation. Product manager at AMD, Rana Mainee refuses to be drawn on the issue of supplying chips to specific manufacturers but admits that Intel's woes have certainly benefited sales of AMD products: "Basically we're terribly happy that people are calling people up and saying that they've heard that Intel products aren't available. The Athlon has also allowed us to expand our market segments."

Gateway partly blames poor fourth quarter results down to public concerns over the millennium bug, although it is clear that insufficient supplies of components has played a major role in the downturn.

A spokesperson for Intel defies the suggestion that the availability of its processors will impact upon its share of the market and points out that it has again regained the lead in the quest for more speed, commenting: "We are going to push ahead with our technology and were very happy to introduce the 750 and 800. The 750 and 800 illustrate our ability to increase speed."

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