AMD challenges Intel with notebook chip

The Turion 64 X2 chips will be the first 64-bit, dual-core processors to reach the notebook market, said David Rooney, mobile division marketing manager for AMD, in Sunnyvale, California. Customers demand 64-bit processing to run multithreaded digital media applications and the future Microsoft Corp. Vista OS, he said.

Multicore processing allows control over many applications running on a single PC. AMD says 85 percent of PC users run six applications at once: antivirus, e-mail, firewall, spam protection, a pop-up blocker and spyware.

Still, Intel's Centrino has been a financial success in the notebook market. Centrino bundles software and hardware, including the processor, chipset and wireless technology.

To compete effectively, AMD will need more than just a good processor.

So, AMD has challenged Intel by offering PC vendors more choice. Vendors can choose from a menu of graphics and wireless providers that all work with Turion chips, such as ATI Technologies Inc. or Nvidia Corp. for graphics and Airgo Networks Inc., Atheros Communications Inc. or Broadcom Corp. for wireless.

By comparison, Intel forces PC vendors to all use the same Centrino platform and compete with each other on price alone, Rooney said.

AMD could also seize an advantage by launching its new chip first, analysts say.

AMD's decision to launch its new Turion in May gives PC vendors time to get their products on store shelves in time for the back-to-school rush, the second-largest selling season in the U.S., said Nicole D'Onofrio, an analyst with Current Analysis.

Already, vendors planning to sell Turion-based notebook PCs this quarter include Acer Inc., Fujitsu Siemens Computers GmbH, Gateway Inc., Hewlett-Packard Co. and nine more.

That could give AMD an advantage whether shoppers are comparing the high-end Turion versus Intel's Core Duo, or comparing AMD's low-end Sempron versus Intel's Celeron, she said.

Intel has traditionally had a massive advantage in market share, with 83.13 percent compared to AMD's 15.14 percent of the U.S. retail market for notebook PCs in April 2005, not counting sales by Dell Inc. or Wal-Mart Stores Inc., according to a survey of national retailers by Current Analysis.

By April 2006, that lead had nearly vanished, with Intel at 54.71 percent compared to AMD's 44.66 percent.

AMD is not nearly as strong in the worldwide mobile PC market, rising from an 8.9 percent market share in the fourth quarter of 2004 to 12.2 percent in the fourth quarter of 2005, according to AMD.

By either measure, most analysts expect Intel to rebound in August when it launches the mobile version of its new Core 2 Duo chips, code-named Merom, featuring 65-nanometer, 64-bit, dual-core design. By reaching the market first, AMD may be able to take the edge off that Intel comeback.

AMD will sell four models of Turion 64 X2: TL-50, TL-52, TL-56 and TL-60. They are priced between US$184 to $354, in units of 1,000.