Advanced Micro Devices Inc. Monday unveiled its most expensive consumer microprocessor, a $1,031 chip for video game enthusiasts that highlights AMD's new plan to market itself as a technology leader, not a cheap alternative to rival Intel Corp.
The chip, called the Athlon 64 FX-57, costs more than most people spend on an entire personal computer -- even one decked out with state-of-the-art speakers and a big monitor. Gamers, looking for ever more detailed graphics and speed, tend to spend freely on the best computer technology.
"These customers are our most loyal," said Jonathan Seckler, the product manager for the Athlon 64 line. "They will pay the price of our best product, and we're raising our prices."
The chip also puts AMD, which has traditionally played the part of lower-price rival to Intel Corp., in an unusual competitive position, since the chip is even more expensive than Intel's $999 Extreme Edition gaming processor.
In this case, AMD decided to raise its highest price by $200, a strategy consistent with a plan by Chief Executive Hector Ruiz to shake off the company's legacy as a maker of cheap Intel clones.
The Athlon 64 chip will be sold in PCs made by several companies, including Alienware, a maker of high-priced PCs. Alienware calls the new AMD chip the "fastest gaming processor in the world" and will sell it as part of its $2,500 Aurora 7500 line, available in six colors, from 'saucer silver' to 'cyborg green'.
The FX-57 chip, the successor to the FX-55, comes with a faster processing speed and quicker links to memory. It is also the first of the FX line to be built with a 90-nanometer manufacturing process, AMD's most advanced. The company's benchmark tests put the chip about 7 percent faster than the FX-55.
Computer applications like e-mail, word processing and Web surfing see few improvements from raw increases in speed, a reality that has led the chip industry away from its focus on speed improvements.
Video games -- with their intense requirements for detailed, three-dimensional graphics -- remain one of the last bastions of the consumer PC market, where speed is king.
Nevertheless, sales of PC games are struggling. U.S. computer game sales fell $100 million last year to $1.1 billion, even as spending on games running on dedicated gaming consoles such as PlayStation or Xbox rose by $400 million to $6.2 billion in 2004, according to the Entertainment Software Association.
High-end, hard-core gaming has traditionally been the domain of the personal computer, but the Xbox and PlayStation consoles have helped make video games into a mainstream activity.
New consoles from Sony Corp and Microsoft Corp based on powerful chips from International Business Machines Corp. could be seen as a new threat to PCs.
But Seckler said AMD does not view the new Xbox 360 and Sony PlayStation 3 as a risk to the company's gaming business. "It will increase interest and also add legitimacy to this segment as a whole," he said.
