VIA provides new efficient chip for PCs

VIA Technologies Inc (威盛電子) introduced what it called a "cheaper and more efficient" computer processor that further reduces the price of low-cost personal computers and eliminates the need for a cooling fan in laptops yesterday at the CeBIT electronics show in Germany.

VIA's new C3 processor runs at a speed of 733 megahertz, the company's fastest chip so far. In January, VIA launched a 700MHz chip, and said it would be followed this year by faster chips, including a 1 gigahertz chip by the end of the year. Currently, only Intel Corp and Advanced Micro Devices Inc have 1GHz chips on the market.

Optimism on the new VIA processor and its new US$500 personal computer, both of which the company debuted at the CeBIT show, catapulted VIA's stock to the market's 7 percent upper-limit yesterday.

The most active stock on the Taiwan Stock Exchange, VIA rose NT$23 to end at NT$358 per share. The shares are up 98 percent this year.

Taiwan's largest chip designer aims to supply the processor to companies making PCs that cost US$500 or less, while rivals such as Intel focus on higher end systems. Via said its C3 processor is priced at US$54, while a comparable Celeron processor from Intel sells for about US$70, according to analysts.

"My estimate is that VIA will sell its chip to PC makers for about US$40," said Richard Ko, an analyst with Deutsche Bank Securities in Taipei.

"If VIA is able to reach a production cost of US$30, it should make good profits."

Compared with chips that are commonly made by 0.25 micron technology today, the C3 processor is the first to be mass-produced using 0.15 micron process technology, which makes the chip about half the size of the Intel Celeron and the Duron from AMD. Using the smaller technology, VIA can make nearly twice the number of chips from one silicon wafer than Intel or AMD can. That gives the company a cost advantage, Ko said. Intel and AMD will likely cut the cost of their processors as they start using 0.13 micron technology later this year.

Taiwan Semiconductor Manu-facturing Co (台積電), the largest chip contractor, is manufacturing the new processor for VIA.

VIA said the new processor generates less heat, allowing computer makers to eliminate cooling fans in both desktop and notebook PCs.

By taking the fan out of the equation, computer product designers can count on increased battery life and the freedom to make smaller, slimmer devices, key selling points for portable electronic products.

"The VIA C3 sets the new de facto standard for affordable, low-power x86 [PC-compatible] processors," Via President Chen Wen-chi (陳文琦) said.

The product is the only one of its kind that does not require a fan in a notebook computer, said Ko.

While Transmeta Corp's Crusoe processor also eliminates the need for a fan, it is not fully compatible with existing processors. PC makers have to redesign their products to accommodate the chip.

VIA's new C3 is comparable to the Crusoe in power consumption, according to Ko, but companies will not have to change designs for the new chips.