Chips Ahoy! Alternative chip makers are sailing into the mainstream PC market -- bringing more choices for computer buyers.

See "Making Changes" for several computer modelsjumping on the alternative processor bandwagon.

Turn on your television, and you'll come across some ratherunlikely advertisements for computer technology. In one JamesBond-inspired commercial, for example, a bad guy plots to take overthe world--only to be foiled by a slow-moving computer chip. The adisn't for a movie. It's for the latest computer chipmanufactured by Advanced Micro Devices Inc. (AMD), a directcompetitor of Intel.

If you've seen this marketing campaign--or gone shopping forPCs lately--chances are alternative chips from makers like AMD andCyrix have entered your radar screen--or soon will. Off-brandcomputer chips are hitting the U.S. computer market with fullforce, having made considerable inroads with top-tier PCmanufacturers like Compaq and IBM. In fact, alternative chips aremaking appearances in some PC manufacturers' models in a bigway, particularly in lower-end consumer desktop models.

One reason alternative chip manufacturers are gaining momentumis they're coming out with better products, says MichaelSlater, principal analyst with MicroDesign Resources, aninformation services company in Sebastopol, California, whichpublishes The Microprocessor Report newsletter. Overcomingsales hurdles and boosting manufacturing capacities have helpedmany companies reach critical mass, as well.

Meanwhile, alternative chip manufacturers have gotten a boostfrom the burgeoning demand for inexpensive PCs. Consumer interestin low-cost computers, particularly in the sub-$1,000 range, isextremely high. And with Intel's competitors selling processorsfor 30 percent to 40 percent less, says Slater, their offeringshave become quite attractive to PC manufacturers.

In 1997, alternative chip manufacturers grabbed about 15 percentof the PC microprocessor market, and they have aggressive plans tocontrol 30 percent of the market by year-end, says Slater. Ifcomputers containing off-brand chips are well-received byconsumers, this could create a snowball effect in which more PCmanufacturers move to adopt them. In the coming months, alternativechip manufacturers challenging Intel's monopoly could providecomputer buyers with an unprecedented array of choices.

Making Their Mark

AMD is among the leading alternative chip makers. In fact, itshealthy position as a supplier of chips to PC manufacturers becameeven more stable recently when Compaq announced that all its newconsumer desktop systems priced at less than $1,200 will includeprocessors from AMD, not Intel or even low-cost leader Cyrix. AMDchips have also been adopted by IBM, Acer, Digital, Fujitsu andother computer manufacturers.

AMD's newest chip is the K6 processor. It's currentlyavailable at peak speeds of 233 and 266 MHz, with plans for a 300MHz version. Benchmark tests on equally configured systems haveshown the K6's per-formance is competitive with the PentiumII--at a significantly lower price. That's because the K6 isbased on a new 0.25-micron technology that allows it to producemore processors per wafer, delivering cheaper chips that alsoconsume less power. The K6 processor also includes MMX technologyfor enhancing multimedia and graphics applications.

By mid-year, AMD plans to release the K6 3D chip aimed atsupplying greater realism for 3-D software and advanced graphicsapplications. This move probably won't impact your businessunless you're involved in 3-D graphics and multimedia. If youare, the K6 3D chip promises to dramatically enhance your visualand audio experience with full-featured MPEG-2 video and AC-3 soundcompatibility. By year-end, AMD will offer the K6+ 3D chip for evengreater realism of 3-D software; AMD's next-generationprocessor, the K7, will be released sometime next year.

Meanwhile, Cyrix has begun to ship the latest version of its6x86MX chip, which performs at 233 and 266 MHz. The 6x86MX offersPentium II performance at a lower price and has full MMXcompatibility to run the latest MMX games and multimedia software.The 6x86MX is primarily targeted at the sub-$1,500 desktop segment.In addition, Cyrix makes the MediaGX processor, with speeds of upto 200 MHz, which is mainly found in sub-$1,000 models.

Because of the low price tag, PC manufacturers looking to pumpup profits are adopting non-Intel processors for their moreaffordably priced consumer models. Compaq, for instance, uses AMDK6 and Cyrix MediaGX processors in new lower-end models of itsPresario line of computers; higher-end models contain Intel'sPentium II chip. Acer, one of the first larger PC manufacturers toput non-Pentium class processors in its machines, uses an AMD K6processor in lower-priced systems of its Aspire line, while IBM isusing AMD K6 processors in two new models of its Aptiva E series.Many of these modestly priced systems offer strong perfomance andthe latest technology.

Navigating The Waters

Interestingly, AMD's primary markets are small andmedium-sized businesses, while Cyrix is honing in on the SOHOmarket. These may prove to be smart moves, say experts, since theseproducts are extremely well-suited for BIZ Experiencesialenvironments.

For cost-conscious BIZ Experiencess, alternative processorstypically offer a better price for a given level of performance.What's more, most perform best when using business productivityapplications such as word processors, spreadsheets and e-mail,Slater says.

The key to evaluating whether alternative processors are for youand your business is to understand how their performance will holdup to your requirements. For instance, Slater says most alternativeprocessors currently perform weakly in the area of 3-D graphics andmultimedia. So if you're working with image processing andhigh-end graphics (or like to play 3-D games in your spare time),you'll need to carefully analyze the processor'sperformance results when they run these kinds of applications."Look at the benchmark ratings typical for the applicationsyou care most about," Slater advises.

Also, you must be comfortable with purchasing a processor thatisn't a "name brand." Slater predicts that as themarket continues to focus on price and value, consumers will becomeless and less brand-conscious.

Ultimately, the growing number of Intel competitors means morechoices for everyone. In the long run, having expanded optionsshould prove advantageous for PC buyers, especially those lookingto get more bang for their buck. In fact, experts believe thiscompetition will drive PC prices even lower.

Contact Sources

AMD, 5204 E. Ben White Blvd., Mailstop 593, Austin, TX78741, (512) 602-6882

MicroDesign Resources, http://www.mdronline.com