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[PSUs]| Friday 26th September 2003 |
A good one to start with - how will Dothan benefit the consumer as compared with previous Intel processors?
MacDonald: Dothan is a system chip to replace what we codename the 'Banias' CPU, which is one of the ingredients of the Centrino package. This was designed simply for notebook users. So if you use a notebook and care about battery life, wireless connectivity or thinner, lighter systems, then these are the features the Centrino family delivers to you. It is a much better mobile experience.
Dothan is the next generation enhancement to that (manufactured on a 90 nanometre process). It's basically more of the same - a beautiful product, but from the same stable as the current Centrino technology.
Even further ahead, mention was made of the Sonoma platform. What does this signpost for the future?
MacDonald: Basically, what we do is we plan, around every eighteen months roughly, for a new platform. And that will be the time when a lot of change is implemented.
So, Sonoma has got the Dothan processor, it's got a new chipset which has a whole bunch of features, and it basically has new wireless capabilities, which include things like additional security features that don't exist today but will in that time frame.
Some of the chipset features will include new sound systems, with better sound that uses less power and causes less crashes. Things like faster graphics support. So it's a combo of performance, battery life and it will support the new Express Cards - the replacements for PCMCIA cards, or card bus technology - it means they are smaller, consume less power and are cheaper to make. So, there are a number of innovations along those lines which at a platform level means a much-improved mobile system compared to the ones you can buy today.
On top of that the infrastructure we are investing in will be more mature. So today it is public wireless LAN, but you'll begin to see some wireless WAN - cell phone technologies built in to notebooks - and you'll be able to do things like get your football scores automatically even when your notebook is in your briefcase, for example, or get that important presentation or that virus download while you are on the go somewhere, even if you are not using your notebook.
So, the concept of having your notebook working for you even when it is in your briefcase will be one of the aspects that we think will be enabled in the Sonoma platform.
Intel has been showcasing Dothan and Sonoma is on the horizon. What are the timelines we are talking about?
MacDonald: The key timelines are: Centrino is available now, that's based on the Banias processor. We will start shipping to manufacturers Dothan, the CPU portion which replaces Banias, at the end of this year. So probably in the very beginning (January timeframe) of next year, you'll begin to get Centrino mobile technology that uses the new Dothan technology. So that's the timing for Dothan.
Sonoma is likely to be in September of next year, as a ball-park figure. But basically the second half of next year. Usually we don't launch products in the middle of the summer, so somewhere around September you will see new platforms using these new products. It will still be Dothan as the CPU but we will have a new chipset and, if the OEMs decide, it will take advantage of all those the new features - the Azalia audio, the Express card, new graphics performance, etc. A whole bunch of new features will come together in that timeframe.
Where does the codename Sonoma come from? I know Microsoft uses the hills around Seattle...
MacDonald: There are a lot of us Brits in the Mobile Group here, so we decided to use names from vineyards, so that we would have an excuse to go and do product planning in various vineyards in California [laughs].
So if you look at the codenames we have, we've got Sonoma, a famous vineyard in this area, Nappa is a very famous vineyard - you get Nappa Valley wines. And Carmel, which was our first Banias platform, is also a wine area, as well as being a nice little town on the coast. We have to pick code names that are meaningless for legal protection reasons. So we just like wines!
Bringing things back to the current state of play, how do you feel the Centrino message has got across to the general public? Are people understanding the 'portability, connectivity' issues, or is there still work to do on that score?
MacDonald: Oh there's heck of a lot more work to do. The good news is that people are buying the product. We've had incredible commercial success with Centrino six months after the launch, so we've been delighted with the way people are buying it.
So we know we that when we preach to the converted - people who have used notebooks, who care about battery life, form factor, weight and performance - that our message resonates with those guys and that is reflected in the number of purchases.
The guys who are buying their first notebook are a very different audience. You don't know that you care about battery life, and if you are a student or a business traveller and you want to use it when you go to your client in London or to a Borders bookstore or wherever you might use a public wireless LAN...
The problem is that you if have never used your first notebook as a mobility product, you're not going to appreciate these things. So unfortunately, that is where we have more work to do. Most people may be tempted to buy a different type of notebook where it won't deliver the benefits of mobility as well as Centrino does. Centrino was designed exclusively for this kind of use.
So you feel the market will naturally evolve towards the Centrino model?
MacDonald: Exactly. The key thing is, you've got to let people taste this. Forget all the marketing fluff - let people use the notebooks, and then they will make their own choice. We're highly confident about this. For example, we placed over 7,000 seed units to corporate buyers, to say 'try it, don't read the specs, don't read the information, just try it'. And we think this has probably been the number one contributor to the commercial success.
The areas which don't come through so well include the performance message. We have fantastic performance in a very power
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What was interesting today was that we showed the Alien Ware and the Voodoo systems as high-end gaming platforms, where they said they had done their testing and said the best gaming experience on a laptop comes from a Centrino platform. So the message is getting out there, the designs are getting out there. The reviews of magazines and Labs, and obviously users themselves, will help. But it's all part of the plan - it's not going to happen overnight.
What is the long-term goal for Centrino? Is it always going to be a high-end segment or are you aiming to eventually absorb the whole laptop market with Centrino technology?
MacDonald: We have already got the majority of our shipments on Centrino actually. It's been a very rapid transition. Last year the Pentium 4 was the fastest shipping product from the Mobile Group in notebooks, in terms of the replacement rates for the previous products. We expected that we would get Centrino to ship more units than Pentium 4 by Q4 and we actually did that in Q3, so already we are selling more Centrinos than we are Pentium 4s. So the majority of our notebook sales use Centrino technology. Very, very strong in corporate and assembly, much more of a megaherz leaning towards in consumer channels. Nevertheless less it is already on track to involve the majority of units we ship.
In the future, what are the price points that Centrino will cover? At the moment they are not the cheapest laptops you could buy....
MacDonald: I disagree, it is already doing that today. You can buy a fully-equipped Centrino notebook for $999 - what's that £700. That's from Acer.
But that's not yet the UK picture
MacDonald: Basically there are two stories. For the first half of this year, the retail product offerings were generally very expensive, with Toshiba at $1,899 and Sony - gorgeous notebook, but - $2,199. The business offerings were much more aggressive than the consumer offerings, and I think that in consumer most manufacturers decided to make it a niche product with a high price point.
Second half of the year is very different. You've got price points at $999, $1,199, and $1,299. Even allowing for VAT, you should still be at less than £1,000 - you should be able to hit mainstream price points.
One of the neat features about Centrino is that there is nothing in the bill of materials that says you shouldn't be able to hit the same price points as you can with the Pentium 4. Pentium 4s require more cooling than the Centrino, so you save theoretically on fans and cooling costs. There is no reason why a Centrino should not be as affordable as a Pentium 4.
You could have a budget Centrino as much as a high-end, ultra-portable model?
MacDonald: In each of the market segments - a value notebook, a performance notebook - you can do that in the US today - you can go out and buy one. We certainly hope you will be able to do that through UK retail chains. Whatever you can do with Pentium 4, you are able do with Centrino systems, too.
We think the market will address that, but it takes a bit of time.
But do you see the contrast in the UK with Pentium machines? Toshiba, for example, has brought out £499 machines...
MacDonald: The actual cost of the Centrino product saves you money overall on a platform level. This is a brand new product at the very beginning of its lifecycle So if you want to introduce something along similar lines, the pricing compared to the P4 is not that dissimilar, so fingers crossed.
We certainly think it should be comparable over time.
It is a competitive market...
MacDonald: Well it is the fastest growing segment of the PC industry and everyone is chasing growth. It has become far more competitive, you've seen that with price points and promotions, and you've seen a heck of a lot more notebooks sold. It is very much a notebook world.
And how does Dothan fit into that, with its extra functionality? Will it inevitably mean a higher price?
MacDonald: We haven't set pricing yet, but it is not obvious that if you had a Dothan processor compared to the Banias that it would cost more.
If we want to make the transition to our 90nm process (on which the Dothan processor will be based), we have a manufacturing pressure on us to say 'make the move from 200mm wafers and .013micron to 90nm with 300mm wafers' - we have a financial incentive to go do that. The best way to do that - this is not rocket science, purely the law of supply and demand - is to say 'if you want to convert all your Banias customers to Dothan, price them at the same price'. It's a much better product, why would you buy the other one?
So that's one of the scenarios I am currently leaning towards, it doesn't have to be more expensive - 'you can get more at the same price point'.
You've already mentioned the 90nm process for Dothan, and another featured technology is its use of 'strained silicon'. Can you explain this in layman's terms?
MacDonald: I'll try! The 90 nanometre technology refers to the thickness of the lanes we use, basically, to do the wiring on a silicon chip. To put that into perspective, in an area the size of your thumbnail, with Dothan, we can cram 140 million transistors into that die size. We are talking very small geometries.
The problem comes when you get these silicon atoms, if you link them in the manufacturing process they are basically crunched together and so an electronic signal basically struggles to get through those atoms, because they are all bunched together.
Think of it like going through a crowd of people at a shopping arcade. What this strained silicon technique does is to stretch out those atoms so that there is a lot more spacing between these atomic structures. And that way you can weave in and out, rather than barging through, and get from A to B much faster.
That's probably the best analogy I can do!
And ultimately this will impact on performance?
MacDonald: Oh yes, because when you are waiting for a signal to go from A to B it will get there nano seconds later than with strained silicon. Basically we see the benefit in two areas. In higher performance, and for a notebook user, because it is more efficient, it is getting the answer and going into idle and saving on battery.
The theory we have for notebook design is 'hurry up and get idle', 'huggi' we call it. Whatever you are trying to get done, do it is as quickly as you can, and go down to deep sleep mode. That means the notebook is available and not burning power.
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