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AMD to unveil Athlon XP
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October 9, 2001: 5:24 a.m. ET
New chips available at speeds up to 1.53 GHz; product to compete against Pentium 4.
By Staff Writer Richard Richtmyer
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NEW YORK (CNNmoney) - Personal computer makers on Tuesday are set to begin shipping systems built using Advanced Micro Devices' newest PC microprocessor, and the chipmaker is planning to follow up with a new marketing campaign aimed at better positioning them against competing offerings from Intel.
Starting Tuesday, Compaq, Fujitsu, NEC and others are expected to begin selling PCs based on AMD's newest high-end processors, now called "Athlon XP," at speeds topping out at 1.53 gigahertz. The new chips feature improvements in performance, graphics capabilities and power consumption.
AMD (AMD: Research, Estimates) is pitting the Athlon XP squarely against the Pentium 4, production of which Intel recently has kicked into overdrive as part of its effort to thwart AMD's gains in market share.
While it still runs a distant second - garnering roughly 20 percent of the market share to Intel's near 80 percent - AMD's Athlon chips have become a much greater threat to Intel (INTC: Research, Estimates) . In response to that threat, Intel in the third quarter increased its level of Pentium 4 production and became even more aggressive in pricing the new chips, intensifying what already had been a bitter pricing war between the two companies.
Although each company has been hurt in that fight, AMD's scars have run much deeper. Just last week, the company warned investors of a wide third-quarter loss, pinning the blame entirely on eroding prices. AMD also has been stung by the loss of some key customers recently, including IBM and Gateway, which have opted to build their systems exclusively with Intel processors.
With the Athlon XP, AMD is taking its fight to the marketing front.
In recent years, AMD and Intel had engaged in a fierce battle of one-upmanship, each trying to outdo the other with incremental increases in microprocessor clock speeds as they vied for the title of microprocessor king. Intel gained the advantage over its smaller rival late last year when it introduced the Pentium 4, which currently tops out at speeds of 2 GHz. Those chips are built on a whole new architecture, called "Net Burst," which Intel says is designed to optimize multimedia applications and can handle much higher clock speeds.
AMD recently shifted its focus away from megahertz, instead emphasizing architectural features it says enables its chips to outperform Intel's speediest chips in many common computing tasks.
Among the improvements in Athlon XP is a new architecture AMD has dubbed "QuantiSpeed," which it says enables the chips to accomplish more work per clock cycle compared with other processors. They also incorporate the same improved graphics capabilities and power-saving features first seen in the Athlon 4, a mobile processor AMD introduced in May.
Because of the divergence in the underlying design of AMD's processor compared with Intel's, AMD contends that megahertz no longer is a fair measure of total system performance.
"What it means is you cannot evaluate the performance of the products solely on the basis of megahertz when you're talking about two different architectures," said Mark Bode, AMD's division marketing manager for Athlon and Duron products.
"Megahertz has been distorted as a proxy for performance and has been devalued in terms of a measure of performance," Bode added.
Moving forward, AMD will sell its Athlon XP processors on the basis of "relative performance," assigning them model numbers the company says will correspond with the performance of competing processors from Intel.
For example, the 1.53 GHz Athlon XP, which AMD claims is outperforms the 1.8 GHz version of the Pentium 4, will be called "Athlon XP 1800." Similarly, the 1.33 GHz Athlon XP, which AMD says beats Intel's 1.5 GHz Pentium 4, will be called "Athlon XP 1500."
To back up its claims, AMD has performed a range of benchmark tests, which are common marketing tools among high-tech companies. However, AMD has taken its benchmarking comparisons a step further then most - having them verified by an independent auditor.
Click here for the benchmark report
Arthur Andersen has independently examined AMD's Athlon XP performance benchmarks and has prepared a full report documenting the benchmarking procedures and validating the results, which will be available on AMD's Web site Tuesday.
"We know from talking to users that not only do they want to know what the benchmarks are, they want to know that they came from an independent third party," Bode said.
"This gives people confidence in the results," Bode added. "There's no hand waving in the background. It is what it is."
The new chips also will be aggressively priced. In 1,000-unit quantities, the Athlon XP 1800 is priced at $252. The most recent list price for a 1.8 GHz Pentium 4 was $256.
The Athlon XP 1700 will sell for $190, compared with $193 for a 1.7 GHz Pentium 4. The Athlon 1600 lists for $160, compared with $163 for Intel's 1.6 GHz Pentium 4. The list price for the Athlon 1500 is $130, compared with $133 for a 1.5 GHz Pentium 4. 
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