Intel's new chip, which will sell for around $990 in volume quantities, is expected to be featured in computers from Dell Computer and IBM, among other manufacturers. With the new chip, Intel will likely drop the price of its 1-GHz Pentium III to around $750. However, the company won't likely cut other Pentium III prices, as it shaved the wholesale prices on the rest of the line by 10 to 24 per cent on July 17. The Santa Clara, California, chip giant has been saddled with a processor shortage since last October when it released a new version of the Pentium III. High demand,coupled with manufacturing difficulties, has made Pentium IIIs, especially the fastest versions, tough to find.

One computer dealer, for instance, noted that it was nearly impossible to get any Pentium IIIs running at above 750 MHz. Now, 933-MHz Pentium IIIs can be found, but backorders still exist, and the 1-GHz Pentium III remains invisible. An Intel spokesman earlier stated that the 1.13-GHz chip would initially show up only in limited quantities when it arrived on July 31. However, he added that 1-GHz Pentium III supplies would increase in the third quarter. By contrast, AMD has fared better in terms of supplying the market this year. The company was partially affected by shortages of motherboards and chipsets for Athlon in the second quarter, but the situation has faded, stated Ben Anixter, vice president for external affairs at AMD. "Infrastructure will not be a limiting factor going forward," he told an audience at the Robertson Stephens semiconductor conference in San Francisco.

Not to be outpaced in the speed race, AMD president Hector Ruiz announced in Europe Thursday that the company would release a 1.1-GHz Athlon on August 28, an AMD spokesman confirmed. The company will then aim at the notebook and server market in the fourth quarter. Corvette and Camaro, which are code-names, will essentially be low-power versions of the current Athlon and Duron chips, said Anixter. Duron is a budget version of Athlon. Although the two upcoming chips will be based around the general Athlon architecture, they will incorporate changes in the processor core that allow the chips to run on less power.

The processors will also contain AMD's PowerNow technology, which reduces power consumption when the notebook is unplugged or not performing energy-taxing tasks. "This will allow us to have our first (Athlon) notebook products," Anixter said. "They will come with an improved core, and PowerNow technology will be incorporated." Turning down power consumption is necessary, according to Nathan Brookwood, an analyst at Insight 64. "The current Athlons are pretty power-hungry," he said. "They consume almost twice the power of the equivalent Pentium IIIs." Gradually, Corvette and Camaro will in all likelihood replace the current Athlon and Duron desktop chips, said a company spokesman. Such a move will simplify manufacturing by reducing the number of processors that need to be made. For servers, the company will release Mustang, which is a version of the Corvette chip with up to 1 GB of secondary cache, a stash of memory near the processor that enhances performance. Mustang will have effectively four times thecache of current Athlons.