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Intel's Xeon chips to migrate downwards

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Chip giant Intel is expected to announce shortly a subtle change in its strategy on its high-end Xeon processors, bringing the server family much closer to the desktop family of chips. That has emerged after an investigation into the pricing of new Coppermine Pentium III and Xeon processors, which Intel will introduce in the week of the 25 October, as we exclusively revealed two days ago. Price lists seen by The Register show that there is not a great deal of price difference between a Coppermine Xeon and a Coppermine Pentium III. The price for ten boxed Coppermine Xeons at 733MHz is $865 each, while the price for ten boxed Coppermine 733MHz/133 is $805. Meanwhile, the price for ten boxed 667MHz Coppermine Xeons is $688, while the 667MHz PIII/100 is $632. A 600MHz Xeon is $533 when bought in quantities of ten boxes. These Xeons have 256K L2 cache, while the Pentium IIIs have 256K ECC cache and active cooling -- fans to you and me. The pricing shows a shift away on Intel's part from its clear differentiation between desktop and server processors. The company has always maintained that its Xeon family is intended for the high end of the market and prices in the past have been much higher than desktop processors. But there is a great deal of similarity between the technology of a Xeon and a Pentium III. Both are IA-32 chips. That has led to mutterings from customers about why they should pay through the nose for a processor just because it has a fancy, pseudo-Greek name. There could be several factors behind the move. Intel is now largely pushing its Merced-Itanium technology as the choice for high end servers. At the same time, boffins at the company are feverishly working away engineering its Willamette IA-32 processors, now expected next year. Given these future introductions, it will be important for Intel to introduce further differentiations in its processor line. An Intel representative would not comment on the re-positioning. But, he said, the Slot 2 cartridges used by Xeons, include built-in manageability, in the form of temperature sensing. Whether this rather subtle difference will lead customers to pay extra for Xeons is a different matter. In the end, unless they are into building systems themselves, they will be somewhat at the mercy of PC vendors, who are likely to continue toeing the Intel line. There is another aspect to this. The i840 Carmel chipset, intended for both workstations and servers, is expected to be announced in a few week's time. This will also allow Intel to create new differentiations in this marketplace. We have also learnt that Intel will offer a merchandise incentive programme (MIP) payment to its resellers of around $30 on chips costing over $600, of around $20 on chips costing between $300 and $500, and of $10 on processors costing less than $300. That means the prices of the parts will end up being cheaper for authorised members of this channel programme. ®

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