Wintel Primes the PC Pump: Tech Rumor of the Day

REDMOND, Wash. (TheStreet) -- Microsoft (MSFT) and Intel (INTC) -- Wintel -- are back in the game.

Speculation is heating up in the PC market, and this time it's not all about netbooks.

If developments go as planned, you can expect a new crop of ultrathin notebooks later this year running on not just the new Microsoft Windows 7 software, but also on new, smaller super-powered Intel chips.

Intel is expected to unveil a new line of chips at the Intel Developer Forum starting Sept. 22 in San Francisco. The line, known as Westmere, will include dual-core processors called Core i3, i5 and i7. These are the first Intel chips build on a smaller 32 nanometer level featuring two core processors, four megabytes of cache memory and a graphics processor all in the same thin package.

After years of watching PC buyers flee bloated, virus-plagued, Windows- powered machines to buy Apple (AAPL) Macs or cheaper stripped-down netbooks, the Windows-Intel duo may be poised to strike back.

The new chips combine computer and graphics processing in a thinner form and are designed to consume less power, two key improvements for laptop fans. Presumably, the new notebooks will sell for less than $1,000, and sit squarely between the $300 netbooks and the $1,400 Macbooks.

The arrival of the new Intel chips coincides with the new Windows 7 system, for a potentially refreshing line up of notebooks for the holidays. The bigger issue however is how well it fits in the consumers' budget.