The May launch of Intel's Santa Rosa laptop PC chips, an upgrade to its popular Centrino package, put a damper on April notebook sales. But at the same time, AMD's latest chip launch looks set to heat up the desktop PC market.
The world's two largest contract notebook PC makers both reported a decline in April laptop shipments, after strong sales in the first three months of the year. The decline was due to users putting off purchases ahead of the launch of new notebook PCs armed with Santa Rosa, according to DRAMeXchange Technology.
These users have been waiting for an opportunity to upgrade their laptop PCs and their operating system (OS) at the same time, so the arrival of Santa Rosa laptops could boost sales of the new Windows Vista OS, the market researcher said. The new set of chips, launched in early May, increases wireless internet and processing speeds in notebook PCs when compared to the previous Intel Centrino package.
At the launch, the fourth generation of the Centrino wireless chip package abandoned its Santa Rosa code name in favour of its marketing names, Centrino Duo and Centrino Pro. Both versions come with Intel dual-core microprocessors, but the Centrino Pro is specifically targeted at laptops for business users. It carries Intel vPro software, which helps corporate IT departments manage fleets of laptop PCs. Intel expects over 230 new laptop and desktop PCs to be built around the Centrino Duo and Centrino Pro this year.
Laptop PC manufacturer Quanta Computer, the biggest contract notebook maker, said last week that it shipped 2.2 million notebook PCs in April. The figure is a notable slip from 2.4 million laptops in March, an all-time high for a single month at the company. Rival Compal Electronics, shipped 1.7 million laptops in April, its lowest figure for a single month so far this year and down from 1.78 million laptops in March. The March figure was its second highest shipment figure ever.
In other PC chip news today, Intel rival Advanced Micro Devices (AMD) will make a quad-core chip for desktop PCs, replacing its venerable Athlon processor with the new "Phenom" design in an attempt to compete better with Intel.
The chip will reach stores in the second half of 2007 and share similar architecture with the "Barcelona" quad-core Opteron server chip AMD is planning to launch in the middle of 2007.
AMD surged into the market with its original Opteron server chip in 2003, but the company began to slip back again when Intel launched its quad-core Xeon and dual-core Core 2 Duo chips in 2006, pushing the two vendors into a price war.
Now, just as AMD hopes Barcelona will convince customers to turn away from Intel's Xeon, it will position the Phenom against Intel's Core 2 Duo. The company certainly needs the help – in April, AMD posted a $611 million (£308.4m) loss for the first quarter, and ran so short of operating funds that it announced a plan to raise $2.2 billion by selling convertible notes to institutional investors.
AMD did not share features or specifications of the Phenom chip design, so some industry experts are withholding judgment until they see benchmark testing. But one analyst said the time is right to bring multicore computing to the masses, as consumers use more and more video, multitasking and digital media in their everyday applications.
"It's going to benefit them," said Toni DuBoise, senior analyst for Current Analysis West. "I've been waiting for their next product for some time because essentially they didn't have an answer to Intel's Core 2 Duo and that was reflected in their market performance."