Intel Corp. is warning computer makers to steer clear of a new chip set that could enable the manufacturers to build less expensive Pentium 4-based PCs by enabling them to use a less costly high-speed memory technology.
Intel contends that the products manufacturer, Via Technologies Inc., has not secured the necessary licensing for its Apollo P4X266 chip set.
Intel representatives have cautioned U.S. and overseas PC and motherboard manufacturers against using Vias product since it could put manufacturers at risk of being drawn into costly legal battles, sources with several of those companies said.
"Intel has indicated that the product is not kosher," said a U.S. representative of a PC maker based in Japan. "But we also have a good relationship with Via and high regard for their products. For now, we are in the early stages of evaluating the chip set for inclusion in future platforms."
Intel, of Santa Clara, Calif., has repeatedly taken Via to court over licensing disputes. Intel is pursuing a lawsuit against Via involving chip sets designed for use with Athlon processors made by rival chip maker Advanced Micro Devices Inc., of Sunnyvale, Calif.
The chip set Via released last week is the first designed to pair the Pentium 4 with a high-speed memory technology called DDR SDRAM (double-data-rate synchronous dynamic RAM), rather than Rambus DRAM.
While Intel contends Rambus offers the best performance, critics claim the technology is too expensive and that DDR—the next generation of SDRAM—offers competitive performance for about half the cost. Pricing has taken on greater importance this year as Intel and PC makers struggle through an industrywide slump.
Amid weak sales of the Pentium 4, Intel has announced it will release an SDRAM chip set next month and a DDR product early next year. The move to less expensive, non-Rambus memory will lower manufacturing costs, enabling PC makers to offer Pentium 4-based systems closer to the $800 to $1,000 price range thats considered the sweet spot of the market.
But with Via releasing its DDR chip set now, the Taipei, Taiwan, company, which holds about a 35 percent share of the world chip set market, stands to reap financial rewards by beating Intel to the market by several months.
"They are not licensed to sell products that are compatible with the Pentium 4," Intel spokesman Chuck Mulloy said last week. Mulloy declined to say whether Intel is warning its business partners to avoid using Vias product, saying only that "those discussions are typically very private."
However, a Via representative confirmed that businesses had reported such incidences to his company.