Advanced Micro Devices saved a surprise for the launch of its Athlon processor - a 650MHz version that AMD claims is the fastest x86-type processor on the market.
Athlon, formerly known as the K7, is being hawked by AMD as a "seventh-generation" processor, thanks to a handful of architectural improvements aimed at boosting performance. Athlon will initially be sold in high-performance desktops, but over time the chipmaker hopes the new processor will bring in revenues from the more profitable workstation and server markets.
IBM and Compaq will be the first big-name vendors to release Athlon desktops later this month or early next month, an AMD spokesman said. Prices are expected to start at about $US1300 for a 500MHz Athlon PC, increasing to more than $2000 for PCs using the fastest chip, AMD said.
A few analysts interviewed last week said Athlon is faster than an Intel Pentium III processor running at the same clock speed. At 600MHz, the AMD chip was up to 14 per cent faster than the Pentium III in a handful of benchmark tests conducted by Mercury Research.
In its own test results released last week, AMD claims that Athlon even tops the performance of Intel's higher-end Xeon processor running certain types of application.
While analysts concede that AMD has designed a humdinger of a processor, they caution that its success depends on the company's ability to bring Athlon to market without any significant manufacturing hiccups - something the chip vendor has struggled with in the past.
"With AMD, the question is never can they design a chip. The question is can they manufacture it in huge volumes, and can they do it on time," said Tony Massimini, chief of technology with Semico Research.
Apart from the challenge of bringing a brand new chip architecture up to volume production, AMD is also preparing to switch later this year to a more advanced, "0.18-micron" manufacturing process. The company is also in the midst of starting up a $2 billion manufacturing plant in Dresden, Germany. Still, AMD executives have confidently predicted that they can make "hundreds of thousands" of Athlons this quarter, and expect to manufacture one million of them in the fourth quarter this year.
Because the chips are aimed at high-performance systems, AMD is likely to sell fewer Athlon chips at first, making manufacturing concerns less of an issue.
AMD also faces a marketing challenge, analysts say. The company will need to convince customers that it's up to scratch as a provider of reliable, high-quality components if the chip vendor wants to break out of the low-cost, mostly consumer niche it currently occupies. Some buyers still equate AMD's K6 family with "cheap chips", which partly explains the introduction of a new brand name, Nathan Brookwood, said a principal analyst with Insight64.
Athlon was also launched in 600MHz, 550MHz and 500MHz versions, as AMD had previously indicated. Intel's fastest Pentium III, released two weeks ago, runs at 600MHz. Intel has no current plans to increase that clock speed before November, although the company will make improvements in other areas of the platform that should make its chips perform better, an Intel spokesman said.
A fast clock speed is only one measure of a processor's performance, and AMD is highlighting several improvements in Athlon's seventh-generation architecture. For starters, the chip has a 200MHz "system bus" licensed from Digital Equipment which is now owned by Compaq. A faster bus speed allows a processor to access data from memory more quickly. By contrast, the Pentium III has a 100MHz bus, which Intel has said it will push to 133MHz later this year.
Athlon also boasts 128KB of on-chip Level 1 cache - a store of memory adjacent to the processor which is also designed for faster data access. That's double the Level 1 cache in the K6-3.
The new chip also includes additional 3DNow! multimedia instructions for applications like speech recognition and video playback, and better "floating point" performance for improved 3D modelling and lighting effects, according to AMD.
To help position its chips, AMD will introduce a sub-branding strategy that takes a leaf out of Intel's book. Just as Intel did with the Xeon, Pentium III and Celeron, AMD will release different Athlons for various segments of the computing market. The sub-brands will use the same Athlon core, but packaged with different bus speeds, cache sizes and so on.
The brands are as follows: the Athlon Select, for low-cost consumer PCs; a chip simply called "Athlon" for the high-performance consumer market; the Athlon Professional for high-performance business PCs; and the Athlon Ultra for workstations and servers. The sub-brands won't be introduced immediately, but will be phased in as the K6-2 and K6-3 reach the end of their life cycles.
In 1000-unit quantities, Athlon is priced at $US849 for the 650MHz chip, $615 for the 600MHz, $449 for the 550MHz, and $249 for the 500MHz part, an AMD spokesman said. These are the prices which were revised from prices given earlier the previous week to press and analysts.