May 2001 Industry Update

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Processors

It is now old news, but AMD has climbed to 22% market share, according to DataQuest, with Intel at 77%. AMD shipped 7.3 million processors in Q1, 6.5 Million of them being Athlon/Duron. This means approximately 33 million processors shipped in Q1, leaving Intel with less than 26 million shipped. Of these, only 1 million of them were P4 processors. Though Intel blamed the slowing economy and PC market for their woes in Q1, AMD not only gained market share but increased shipments slightly over the previous quarter.

While Intel has certainly felt some pain with the slowdown, it has also provided them an opportunity to focus on P4 more quickly than they otherwise would have. Fab space that might have been used for PIII production has been converted to P4 production rather than sitting idle. This allowed Intel to make some deep price cuts on the P4 in April, obviously in reaction to the dramatic gains by AMD during the previous quarter. So far, there does not seem to have been the expected reaction to these cuts, as there are indications that sales are no better this quarter than last.

Stories that Intel would be hampered in their move to .13u due to equipment delays made the rounds for a few weeks, but Intel has insisted that the Tualatin will appear on time, and in volume. Later in the year, the P4 will also get a shrink, allowing faster speeds and lower prices. Though many have focused upon the mobile market as the target for Tualatin initially, there will also be desktop versions, and it seems to be a very good option for high-density, rack-mounted servers due to the low power dissipation and low thermal requirements. AMD is going to have a difficult time countering this product in its main target markets, it would seem.

AMD has not been sitting still, of course. Since further gains in the desktop market would be much more difficult in the current environment, AMD decided to focus their attention on the notebook market, which they all but disappeared from completely at the end of last year. By re-targeting their entire production of Palomino processors for mobile applications, AMD has been able to quickly get back into notebooks from Compaq and others, including Sony – a traditionally staunch Intel user. The main benefit over the TBird core seems to be power dissipation, which is about 20% lower. It should be interesting to see what inroads AMD can make in the mobile space before Tualatin makes its appearance.

AMD is also slated to release their 1.4GHz Tbird in early June (during Computex), and some reports have claimed a 1.5GHz will also be released about that timeframe. More likely, the desktop Palomino 1.5GHz will be released the following month, which should run on most, if not all, existing Socket A motherboards that support the proper multiplier/FSB, in conjunction with the Morgan desktop and mobile processors (1GHz?).

Transmeta has had some significant design wins recently, with several Japanese manufacturers announcing mobile systems using the Crusoe processor. Battery life is said to be as long as 14 hours in some designs, which could be a very attractive option for some users. It also appears that Transmeta has licensed AMD’s HyperTransport and x86-64 technology, putting some interesting pressure on Intel’s 64-bit efforts from the low end. Intel already has a hard row to hoe at the high end, one would think.


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