Intel, AMD Continue Rivalry With New Superfast ChipsIntel, AMD Continue Rivalry With New Superfast Chips

Intel on Monday unveiled its fastest processor to date--a version of its Pentium 4 chip running at speeds of up to 2.2 GHz and featuring twice as much on-board memory as its nearest predecessor. The chip is the first to be built using Intel's new 0.13-micron fabrication process, which lets the company build circuits so small that 55 million transistors-each one one-thousandth the width of a human hair--can be placed on a single chip. With such extreme miniaturization, Intel engineers have managed to cram 512 Kbytes of memory (level 2 cache) onto the chip for increased performance. Intel is also offering a version of the new chip at 2 GHz.

Not to be outdone, Intel rival Advanced Micro Devices Inc. unveiled its latest offering, the Athlon XP 2000+. Despite the name, the chip does not run at a clock speed in excess of 2,000 MHz. Rather, AMD's naming convention is based on what the company claims is its performance relative to an Intel chip. AMD says the Athlon XP 2000+ will perform as well as, or better than, a 2,000-MHz (or 2-GHz) Intel chip, even though it runs at a lower clock speed. AMD says architectural enhancements, such as its 3DNow Professional instruction set, make up the difference.

Compaq and Hewlett-Packard are introducing PCs based on the new AMD and Intel chips, while Gateway Inc. and Dell Computer are sticking to Intel exclusively. But with system prices in excess of $1,500 for PCs based on the Athlon XP 2000+ and more than $2,000 for those built around the 2.2-GHz Intel chip, analysts say computer makers may have a tough time moving the new offerings. They note that 1-GHz systems, which offer more than enough power for most Internet and desktop applications, can be had for less than $1,000. Further, many of the applications that would justify a 2-GHz processor, such as videoconferencing or online gaming, also require users to have broadband access to the Internet. Says Technology Business Research analyst Brooks Gray, "At this point, consumers would be better off upgrading their pipes rather than their processors."