[UntirtaNet] AMD Fires at Intel With 1.8GHz Athlon
- From: <yayantea@xxxxxxxxxxxxx>
- To: <untirtanet@xxxxxxxxxxxxx>
- Date: Thu, 13 Jun 2002 13:06:40 -0400
June 10, 2002
AMD Fires at Intel With 1.8GHz Athlon
By Ken Popovich <mailto:ken_popovich@xxxxxxxxxxxxx>
<>
Advanced Micro Devices Inc. on Monday released its first desktop
processor built using its new 0.13-micron manufacturing process,
a method that can produce faster, less power-hungry and smaller
chips, which ultimately are cheaper to make. Though the clock
speed of the new Athlon XP 2200+ is 1.8GHz --- only about 6 percent
faster than AMD's previous 1.73GHz XP 2100+ --- the chip's launch
is particularly noteworthy as it marks the product line's migration
to a more efficient production method that will enable AMD to
remain competitive against Intel Corp.'s Pentium 4. Intel and
AMD usually migrate their product lines to more modern manufacturing
methods every 18 to 24 months. In general, the switch, known
as a process shrink, allows the etching of smaller transistors
onto silicon chips. As a result, more transistors can be packed
onto the die to improve performance. In addition, the overall
chip die is reduced, easing manufacturing costs per chip. Smaller
chips also consume less energy. Intel began migrating its PC
processors from a 0.18-micron to 0.13-micron process last year,
and in January introduced its first desktop Pentium 4 chip built
using the new process. But while Intel migrated first, AMD's
chip is less expensive to produce because its XP 2200+ is about
40 percent smaller than a comparable Pentium 4 processor. AMD's
chip relies on its lower manufacturing cost per chip to undercut
the prices of Intel's products, largely viewed as its sole competitive
advantage. However, Intel has recently stepped up the pressure
on AMD by slashing prices <http://www.eweek.com/article/0,3658,s=701&a=27395,0
0.asp> across its Pentium 4 line more than 50 percent between
April and May. The cost-cutting moves effectively eliminated
AMD's usual price advantage. Monday's launch of the XP 2200+
underscored that point, with the chip initially priced at $241,
the same price as a 2.2GHz Pentium 4, which AMD claims offers
similar performance. (Prices are based on 1,000-unit shipments.)
The relatively low prices stand in stark contrast to the heady
days of PC sales growth in late 1999 and early 2000. For example,
AMD priced its first 1GHz chip at $1,299 when it was first introduced
in March 2000. Intel's spring price cuts, while in keeping with
an historical trend, may have undermined the chipmaker's profitability
amid a continued slump in PC sales. Last week, Intel stunned
Wall Street <http://www.eweek.com/article/0,3658,s=701&a=27862,00.asp>
by lowering its sales forecast for the current quarter. Financial
analysts expressed particular concern about Intel's projection
that its gross profit margins would slip to 49 percent, well
below an earlier forecast of 53 percent. The news sent the price
of Intel share plummeting about 20 percent over two days. ~
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