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Intel's Atom is on a collision course with Core—and everybody loses

Mark Hachman | June 5, 2013
Here's the question that's keeping Intel up at night: If the latest.

Intel has made it clear that its fourth-generation Core or "Haswell" processors will power future PCs. But at the low end of the notebook market, the company's branding strategy will be far muddier—and that's bad for Intel, considering it needs to tell consumers exactly what to buy.

On one hand, Intel needs to present a clear alternative to ARM, whose tablet partners dominate the mobile space and threaten traditional PCs. From a technical standpoint, Intel seems well on its way to solving that problem. Intel's Haswell chip will eventually migrate to as little as 6 watts, Intel said Tuesday, meaning that its Core chips could eventually power tablets, too. But in the meantime, Intel's upcoming "Bay Trail" Atom chips are waiting in the wings—and could offer the performance buyers want at a fraction of the price.

This fall, buyers looking to pick up an inexpensive Windows convertible or notebook may have to sort through several processor brands, including Atom, Core, Pentium, and Celeron. And that's without even factoring in the code names: Bay Trail, Silvermont, and Haswell, among others. Intel may have the right chip at the right price, but because its processor line-up is so crowded, it's in real danger of screwing the whole thing up.

If there's one thing Intel did "wrong," it's that it made the Bay Trail Atom chip so good—too good for some Wall Street analysts, who worry that a $60 Atom chip will drag down profit margins at a company used to selling Core chips for hundreds of dollars.

While the first-generation of "Clover Trail" chips powering Windows 8 convertible tablets were underwhelming, the "Bay Trail" generation, featuring quad-core processors, will power touch-enabled thin notebooks with "really good performance" that will hit $300 price points, former chief executive Paul Otellini said in April. So who's going to buy a $600 Core notebook if a machine half the price will do the job?

"Basically, in Atom they have a part that's going to be a problem," summed up Dean McCarron, principal analyst with Mercury Research.

Branding just makes the problem worse
Intel tried to solve the problem on Friday by bringing the Bay Trail chip under the Pentium and Celeron brands. Technically, this makes sense, because Bay Trail is PC-ready, with support for PC components like PCI Express.

Intel sources also said Friday that Intel has begun phasing out the Atom brand in discussions with OEMs, replacing it with the "Silvermont" name. That's the name of the architectural refresh for the upcoming Bay Trail chip. Whether "Silvermont" appears on the outside of a box is unclear, but for clarity's sake, let's hope not.


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