Little Play For Celeron Chips In High End

Last month, Intel began shipping 2.2GHz and 2.1GHz Celeron processors, both of which are based on 0.13-micron process technology and use 478-pin packaging. Both feature a 400MHz system bus, the company said.

The 2.2GHz Celeron is priced at $103 in 1,000-unit quantities, while the 2.1GHz is priced at $89 in 1,000-unit quantities.

The latest Celeron introduction highlights the breakneck speed at which Intel has been pushing higher clockspeeds into cheaper prices. As recently as the second quarter of this year, a 2GHz Pentium 4 processor was shipping from Intel into the channel at $342. The price of the 2.1GHz Celeron is almost 75 percent less for the same clockspeed.

While Intel's highest-performing desktop chip,the 3GHz Pentium 4,may be slow in catching on, other Pentium 4s are hitting their stride, say several solution providers. In particular, heading into the end of the year, chips introduced earlier in 2002 seem to be building a head of steam, they say.

"The 1.8[GHz and 2[GHz is the sweet spot," said David Chang, president of Agama Systems, a Houston-based white-box maker and solution provider. Celeron processors, he said, are not exactly the first consideration in providing systems to accounts.

"Celeron in our channel is not doing too well," Chang said. "The price point is good [in the consumer space, but we don't use that many Celerons."

Earlier this month, Intel CFO Andy Bryant indicated that all parts of the company's Intel Architecture group,including "Pentium 4, Celeron, motherboards [and chipsets",were seeing normal, seasonal sales patterns. However, Bryant did not offer a breakdown of sales comparing consumer with corporate shipments.

Analysts who follow Intel frequently voice concern that a mix of products showing higher levels of Celeron shipments and lower levels of Pentium 4s lead to lower profit margins for the chip giant. Bryant said the company would not discuss its average selling prices for the quarter until it formally releases its earnings results early next year.

Some solution providers have said they were told by Intel not to expect any processor price reductions before February.