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Could NatSemi SOCs threaten Celeron's existence?

When everything's on one chip, what price the Celeron

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Analysis Intel engineers, as we speak, are scrabbling desperately to come up with their own version of a system on a chip (the Timna), but it is likely that National Semiconductor's Geode SOC has a clear lead of a year on the competition. But that poses questions as to what Intel will do with its Celeron processors faced with the rise and rise of so-called Free PCs. For the whole of this year, Intel has relentlessly pursued a strategy of dropping prices on its Celeron family (essentially the same chip as a Pentium II), while bringing out speed enhancements. However, our information is that NatSemi is likely to price its Geode family at around $20-$30, according to the quantities bought. It does not take much imagination to foresee a spate of very inexpensive PC-compatible devices that cost less than the price of a high-end Celeron. Although NatSemi is claiming that it is not positioning the Geode in the PC marketplace, there is nothing to prevent large outfits like Acer using it as a way of achieving volume at the very low end. Indeed, Stan Shih, CEO of Acer, said at a keynote speech at last year's Computex that he wanted to proliferate such PC compatible devices at rock bottom prices throughout segments of the market so far untouched by consumer hands. NatSemi is positioning the Geode as a chip for set top boxes, Internet devices, Web PADs and the like. And, of course, this is precisely where Intel wants to be, too. Graham Jackson, a National European marketing director, agreed there was some overlap between information appliances the low end PC market. He said: "We had this concept of PC on a chip and it changed quite soon to become the information appliance on a chip, and we decided not to compete in the low cost PC market." However, he said, there was nothing to stop NatSemi customers using the Geode in such devices, particularly given the fact that it has analogue output. Given that, how long has the Celeron got to go before it's got to go, if you see what we mean? ®

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