Despite the recent slow down in the PC market, AMD and Intel both remain optimistic its prospects, with AMD claiming the market is healthy and growing at a good rate.

Hector Ruiz, anointed successor to Jerry Sanders, predicted that sales would recover in the second half of 2001, rising to $41 billion in 2002. Sales in 2000 totalled $30 billion.

Meanwhile, the top man at Chipzilla, Craig Barrett, was speaking at the CES (Consumer Electronics Show) singing the praises of the personal computer. He said that other devices would proliferate, but they would all connect to a PC in some way or other.

He is quoted on Infoworld as saying: "The PC is really at the centre of the Internet, the main client. And what we're seeing today is that more and more devices are being attached around the PC, extending the PC's influence."

Recent research from Forrester would seem to support both chip makers' view about the state of the market, but for different reasons.

The researchers said that the death of the PC is overstated. Growth may not be so impressive as through the 1990s, but families are expected to start buying additional PCs, thus boosting the market. Over the next five years, the number of two-PC homes is expected to grow by 19 per cent per year, the company said.

Despite this, by 2005 the PC will still not be all pervading. Around half the consumers in the Mediterranean region will still not have a PC.

Ruiz predicted that as well as a H2 upturn in sales, demand for Flash memory products will increase in the near future. He said that Flash memory producers have been unable to keep up with demand, an imbalance he thinks will continue for "several years".

He said that AMD would invest in capacity addition, based on the forecast doubling of the market by 2002.

Barrett was more cautious. He said that there was little profit to be had, for Intel, outside it's core business of selling computer processors. ®