Clone chip manufacturer AMD has scored a significant win in its battle with Intel for first tier PC vendors, signing up Digital Equipment and may be close to inking a deal with Hewlett Packard.
Digital will build AMD's Socket 7 chip into its Venturis range of PCs. And negotiations are also well under way with Hewlett Packard, sources say, while AMD is keeping the wraps on other first tier vendor partnerships, which it is likely to announce the day after Intel's official launch of Pentium II (Klamath).
Gerry Sanders III, chief executive of AMD and former co-worker of Intel head Andy Grove, told shareholders yesterday that Digital would use its chips, building on a relationship going back many years. Only a few years ago, AMD took over the Digital chip manufacturing plant at South Queensferry, Scotland. One source said: ?This is Digital returning a favour we did it some years ago.?
A representative from Digital in the UK denied all knowledge of the deal but an AMD representative insisted it was going ahead. ?Probably, the US has not told the UK yet,? he said. ?We said we?d have two first tier customers by the summer and this is the first one.?
But he denied that Hewlett-Packard will use AMD chips, although a source confirmed HP is likely to use the low end K5 processor in some of its PC models.
The real coup for AMD would be Compaq. Although Digital is a big name and good marketing win, it does not ship the volumes of the likes of Compaq. And though the premier PC maker wants to protect itself from accusations it has fallen out with Intel, the likelihood, according to sources, is that it will produce some of its machines using non-Pentium II technology. It has already signed a deal to license chips from clonemaker Cyrix to include in its Presario range.
AMD is also likely to pull the Mitsubishi Electric PC Division out of the bag as well as a spate of other tier one and tier two vendors.
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