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Intel confirms mobos shortage will put freeze on PCs

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A shortage of vital chips could cut output from some computer motherboard makers by more than half during the next two months, industry sources say. Yesterday, The Register exclusively reported vast shortages of passive components. (Go here) Manufacturers are currently trying to increase production in preparation for the peak Christmas season. Demand for Intel's BX and ZX chipsets is exceeding supply, admitted Deborah Yen, public relations manager at Intel, Taiwan. Chipsets are an essential component of the motherboard - the main circuit board in a PC. Intel is the world's largest manufacturer of chipsets, and the BX chipset, despite being introduced more than a year ago, remains one of the most popular. Yen warned that the shortage could be exacerbated by motherboard manufacturers who ordered more than they needed in the hope of securing supplies of the chipsets. Intel is attempting to increase production, she said. "We were allotted about 60,000 chipsets by Intel," said Jeremy Smith of motherboard maker, Abit, "but we had requested about 200,000 [for this month], then after that there's nothing and we still need another 200,000. The discrepancy is huge." Abit plans to send a delegation to Intel's US headquarters to discuss the situation soon, he added. Abit's maximum monthly output, which has been reached recently, is around 300,000 motherboards, Smith said. A source at another motherboard manufacturer, Shuttle, said earlier this week that supplies of the BX and ZX chipsets were at half the normal level. Executives at major motherboard manufacturer, Asustek Computer, were either unavailable or refused to comment on the chipset shortage. "I think the main impact of the shortage is going to be in the next two months," Smith predicted. Tony Yang of Acer Group affiliate, AOpen, admitted that the shortage was affecting his company. However, he claimed that Intel was trying to maintain supplies to 'first tier' motherboard manufacturers like Aopen. As a result, he said, Aopen's supplies of the BX and ZX chipsets were only around 15 per cent below normal. AOpen makes almost 200,000 motherboards per month, 70 to 80 per cent of which use the hard-to-find chipsets. Motherboard makers are trying hard to find other solutions to the shortage, said one industry source. "There are gray market possibilities, but I don't know if Intel approves of that, and of course, the prices are much higher." AOpen is offering customers the option of using a newer Intel chipset, the 810, or chipsets from local companies like VIA Technologies. Douglas Wang, an analyst at Jardine Fleming, Taipei, pointed out that the Intel 810 and BX chipsets were aimed at very different market segments. Other motherboard manufacturers say that, like Aopen, they are looking to other companies' chipsets to meet the shortfall. Dr. Chin Wu, president of local chipset manufacturer, Acer Labs Inc. (ALi), believes the shortage is only a short term situation. While there will be some increase in orders for companies like ALi, Wu said, he does not expect the effect to be very great. Wu questioned the reasons for the continuing shortage, speculating that Intel may want motherboard manufacturers to start using the newer 810 chipset. The chipset has suffered technical problems, attracted criticism for poor performance, and been slow to win acceptance. However, Intel has denied this and Jeremy Smith of Abit also disagreed. "We've been told by a contact at Intel that it's not that Intel's trying to force manufacturers over to the 810 and 820, but rather it was just a mis-forecasting... a misjudgment on their part." ®

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