Intel, AMD Air Chip Advancements

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Intel hit the ground running Monday by unveiling a dozen new additions to its Intel Xeon processor lineup.

The new products, which include chipsets, processors, and platforms for Intel-based workstations and servers, will begin shipping by the end of the year, the company said.

Gartner Dataquest is predicting that Intel’s new product releases could spark a $20 million revenue increase for Intel-based servers by the beginning of next year.

Just last week the Santa Clara, Calif.-based chipmaker went to market with its Pentium 4 processor at 3.06 Ghz, which combined with today’s new offerings, mark the largest assembly of new products the chipmaker has released in seven years.

Intel is also sitting on a potential cash-cow when Microsoft Windows .Net Server 2003 is released, which is based on Intel Itanium and Xeon processor architecture.

Intel’s new releases include four Intel Xeon processors for two-way servers and workstations, at speeds up to 2.8 GHz with 512 KB; and three new chipsets, the E7501, E7505, and E7205, which are designed to provide faster speeds for network security, traffic management, and voice over IP.

The E7505 chipset is designed for two-way workstations using Intel Xeon processors, and the E7205 is for single processor workstations based on Pentium 4 processors. Both chipsets also support USB 2.0 and include AGP 8x support for graphics-intensive applications.

All three new chipsets also support dual-channel dynamic data rate memory, and the E7501 and E7505, codenamed “Placer,” support 64 bit PCI/PCI-X for high bandwidth I/O connectivity.

Intel also announced five new server platforms based on the new processors and chipsets that utilize Intel PRO/1000 MT Server Network Connections, embedded serial ATA, Ultra320 SCSI, AGP 8x and Intel Server Management version 5.5.

Intel’s new product lineup comes on the heels of an announcement last week that the chipmaker had gained approval from its board of directors to buy back an added 480 million shares of its own stock as part of the company’s ‘stock repurchase program,’ which began in 1990. Intel has so far repurchased an estimated 1.7 billion shares, and pumped $29 billion into the effort, the company said.

On the other side of the chipset, Advanced Micro Devices (AMD) got off to a shaky start this week by announcing that its would take a fourth-quarter pretax charge of between $300 and $600 million to execute its restructuring and cost-cutting strategy, which also includes the elimination of 2,000 jobs from AMD facilities in the U.S., Europe, and Asia.

The after-tax cost for AMD’s restructuring could cost as much as $800 million, the company said Monday, far more than was originally estimated on Nov. 14, when AMD first announced its initiative to reduce expenses by $350 million in 2003.

AMD has seen its stock slip 68 percent since the beginning of the year as a direct result of the slump in the market and a slowdown in sales.

AMD’s President and CEO Hector Ruiz was quoted as saying that the company is on the verge of releasing a slew of new products that will bolster company sales.

“Over the next 180 days, we are unleashing a number of intensely competitive products and solutions to the marketplace that will enable us to compete in segments of the market where we have not yet been before,” said Ruiz. “In essence, we are confident that we are taking the steps needed to solidify our financial position while extending our competitive reach across broad segments of the market.”

Ruiz is expected to deliver a keynote speech at Comdex 2002 in Las Vegas, where AMD will be demonstrating systems based on the upcoming AMD Opteron and AMD Athlon processors. The Opteron is AMD’s competitive chip offering to Intel’s Itanium, and is slated to start shipping by the beginning of 2003.