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AMD to Offer First 64-Bit PC Chip

It expects the Athlon 64 to be a must-have for game players and to boost its standing against rival Intel.

September 22, 2003|Terril Yue Jones | Times Staff Writer

Chip maker Advanced Micro Devices Inc. hopes to one-up industry giant Intel Corp. this week with a 64-bit microprocessor for PCs.

When AMD unveils the Athlon 64 on Tuesday, it will be the first 64-bit chip used in desktop computers running Microsoft Corp.'s Windows operating system.

AMD, whose chips power about 17% of the world's Windows-based PCs, expects the Athlon 64 to be a must-have for speed-hungry game players and to usher in the next generation of super-fast microprocessors.

"We're on top of the mountain with a snowball," said Rich Heye, vice president of AMD's microprocessor unit, "and we're going to drop it."

But few outside AMD expect the new chip to give the Sunnyvale, Calif.-based company much more than bragging rights.

"There's really no great requirement for 64 bits by users of desktops," said David Wu, a semiconductor analyst with Wedbush Morgan Securities in Los Angeles.

Bits are the fundamental units of computing, and one of the benchmarks of microprocessor performance is the number of bits a chip can process at a time. The Intel chips that act as the brains in the majority of personal computers process 32 bits at a time.

Engineers liken the switch to expanding a 32-lane highway to 64 lanes.

When Apple Computer Inc. last month introduced its own 64-bit processor in the Macintosh G5, the Cupertino, Calif., company proclaimed it was the fastest desktop computer ever made for everyday use.

Apple has only a 2% slice of the computer market, but it routinely vies with Intel and AMD to boast the most powerful desktop chip.

AMD's new chip is likely to boost applications such as complex video editing, computer-aided design and high-end computer gaming. It's unlikely to make much difference in word processing or Web browsing.

The Athlon 64 will appear first in Hewlett-Packard Co. PCs in Europe. It will be available in the United States later this year, but only through special order -- not retail stores, HP sources said. Dell Inc., the world's largest maker of personal computers, is closely aligned with Intel and not expected to adopt AMD's new chip.

Although 64-bit computing already is available for the servers that run huge corporate, university and government systems, the components and software for desktop PCs are still built around a 32-bit standard. That creates bottlenecks that inhibit the performance of even the most powerful microprocessor.

"The operating system, memory, applications, drivers, etc., all need to be 64-bit, and the surrounding hardware needs to be upgraded," said Shane Rau, a computer chip analyst with the technology market research firm IDC. None of that is coming soon, Rau noted.

Nonetheless, AMD's Heye said that just as chips jumped from 16 to 32 bits in 1985, the market will ultimately evolve to 64 bits. "It's not a killer app, it's a killer environment," Heye said.

AMD can ill afford to be wrong. The Athlon 64 is about a year behind schedule. The company has lost $1.7 billion over the last eight quarters, and its global market share has dropped from a 2001 high of nearly 21%. Revenue has fallen from $4.6 billion in 2000 to $2.7 billion in 2002.

Analysts are watching AMD's bet with the Athlon 64. The question, said IDC's Rau, is "Can they grow market share and be independent and control their own destiny? Or will they be permanently marginalized by Intel?"

For its part, Santa Clara, Calif.-based Intel has no immediate plans to adapt its 64-bit Itanium server chip to desktop machines.

"It's on our planning horizon," Intel President Paul Otellini said last week. But for now, he said, 32 bits provide enough computing muscle for desktops, and "it's way too early to talk about" 64-bit PCs.

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