AMD's Llano could heat up chip war with Intel

The upcoming Llano chip puts AMD in a better position to compete with Intel, which offers Sandy Bridge chips

The chip war will heat up as Advanced Micro Devices prepares PC processors to rival Intel's Sandy Bridge chips, which have already started appearing in laptops, analysts say.

Intel's new Core i3, i5 and i7 chips are now available in consumer laptops such as Dell's Inspiron R-series models, which were introduced on Thursday and priced starting at $US499. AMD, meanwhile, plans to release new A-series chips, which are code-named Llano, for consumer laptops and desktops in the second quarter.

The A-series processors could intensify the chip battle between Intel and AMD as consumers evaluate laptops based on price and performance. The Intel and AMD chips both combine a CPU and graphics processor inside a single chip, but have unique strengths, analysts said.

Intel's Sandy Bridge chips are generally considered to provide better CPU performance and have a capable graphics processor, but PCs with AMD's Llano are thought to better handle graphics-intensive tasks.

Laptops with A-series chips could be priced above $499, higher than laptops and netbooks carrying AMD's low-end E-Series and C-Series chips, which started shipping earlier this year, an AMD spokeswoman said. But the pricing of laptops will ultimately depend on PC makers, the spokeswoman added.

The A-series chips will include between two and four cores, according to the company's road map.

Beyond price, laptop selection will likely depend on the type of PC a user is looking for, said Nathan Brookwood, principal analyst at Insight 64. If a buyer needs to run programs that stress CPUs they may prefer laptops with Sandy Bridge, which has a CPU core that is faster and more advanced than the CPU in AMD's Llano, which is based on an architecture that is six to seven years old.

"That's not even up for debate," Brookwood said.

Intel's new Core i3, i5 and i7 chips can render high-definition video and are good for mainstream gaming, Brookwood said. Analysts said that Intel has looked beyond the graphics processor, implementing instruction sets to process 3D graphics and accelerators in the integrated chips to quickly decode and encode video.

But AMD's Llano will have a better graphics engine and offer a superior movie playback and gaming experience, Brookwood said. Llano's integrated graphics processor supports DirectX 11, which is a set of tools that help generate more realistic images when playing games on PCs running Windows 7. Most of the recent high-end games released support DirectX 11, Brookwood said. Intel's Sandy Bridge chips support a version of DirectX 10, which puts it almost a generation behind AMD.

AMD's superior graphics capabilities could also give it a price advantage, Brookwood said. PCs based on Intel's Sandy Bridge chips may require a dedicated graphics card to handle high-end graphics, which could increase the price of laptops.

But few users need high-end graphics, and the consumer market is trending to lower-end laptops where price matters more and graphics matter less, said Dean McCarron, principal analyst at Mercury Research.

"If you want to compare CPU versus GPU performance ... that depends on the price you are willing to pay," McCarron said.

McCarron said he expects AMD to use Llano's powerful graphics core as a means to gain market share from Intel, as opposed to changing its pricing model. AMD typically has a price advantage over Intel, with laptops selling for comparably lower prices.

AMD lost market share to Intel in the fourth quarter last year, according to an IDC study released in February. Intel had an 80.8 per cent processor market share, compared to 80.5 per cent in the fourth quarter of 2009. AMD's market share was 18.9 per cent, declining from a 19.5 per cent share the previous year.

Graphics chips are being increasingly used in high-performance systems for parallel execution of some scientific, math and video applications. But many programs for desktop operating systems like Windows have been written for processing on multicore CPUs.

Intel may be "overweight" on CPUs, but AMD is making a bigger bet on graphics as computing becomes more visual, said Godfrey Cheng, director of product marketing at AMD's client technology unit.

A lot of the Web browser processing goes through a CPU, but the latest versions of Microsoft's Internet Explorer, Google's Chrome and Mozilla's Firefox offload tasks such as Internet video to the graphics processor.

AMD is also providing tools for programmers to write applications for execution on graphics processors, Cheng said. AMD's graphics processors also support OpenCL, a programming standard for parallel execution of tasks across multicore CPUs and GPUs.

But graphics processors are also known to be power-hungry, which could hurt laptop battery life. To tackle the issue, AMD has added some power-saving features such as power gating and the ability to shut down blocks of the graphics processor.

"We're giving [consumers] more power, capability to process videos," Cheng said.

Intel spokesman Dave Salvator said that rather than talking CPU versus GPU, it is more useful to look at what people do regularly with PCs. Sandy Bridge chips are good for mainstream gaming, and have advanced power-saving and security features.

"If you're an enthusiast gamer, then Intel Core i7 with a high-end discrete 3D card is the right solution for high-end gaming," Salvator said.

AMD may have an aging CPU in Llano, but a price advantage and a better graphics processor could help it compete with Intel's Sandy Bridge, Mercury's McCarron said. AMD will provide a much-needed upgrade to the CPU to the new Bulldozer core next year, but consumers may not wait.

"Upgrade when you feel the need to upgrade," McCarron said. "If you wait for [new] technology, you'll be waiting continuously."

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