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AMD Tries Hand at Triple-Core Chip

The company seeks a broader market for its Phenom line.

SAN FRANCISCO -- After spending the last several months racing to get a quad-core processor out the door,

Advanced Micro Devices

(AMD) - Get Report

is readying its next silicon creation: a chip with three cores.

The company disclosed Monday that it is planning a triple-core version of its forthcoming Phenom desktop processor, to be released in the first quarter of 2008.

That's at least one quarter after AMD releases the more capable four-core version of Phenom, which is slated to ship sometime in 2007.

AMD said its triple-core processor was not a step backward, but a way to offer multicore computing technology to a broader audience.

The triple-core will be destined for mainstream, midrange desktop PCs, whereas the quad-core Phenom is aimed at high-end, enthusiast-class machines, AMD officials explained at a media event here Monday.

This segmentation provides more choices, and presumably a greater range of prices, for consumers. "Triple core provides a better intermediate step" to take advantage of mulitcore technology, said Bob Brewer, head of marketing and strategy for AMD's computing group.

AMD cited data from Mercury Research pegging the global share of quad-core desktops at a mere 2% in the second quarter as evidence that the market is ripe for greater selection.

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Whether consumers upgrading their PCs will see any value in limiting themselves to three cores instead of choosing four cores remains to be seen and will depend on how AMD prices the two iterations of Phenom chips against each other. The company did not provide pricing information Monday.

Because AMD's triple-core is essentially a quad-core Phenom chip with one core disabled, the announcement also suggests the possibility that the newest chip is simply a way for AMD to maximize its factory yield: Chips that roll off the manufacturing line with a defective core can be salvaged and sold as a triple-core, rather than tossed into the scrap heap.

AMD officials disputed that characterization.

"There's a yield component to anything that happens in a semiconductor company," acknowledged AMD's Brewer. But the primary motivation to release a triple-core chip was to improve the company's menu and management of products, he stressed.

AMD's triple-core announcement comes a week after the chipmaker launched its

long-awaited quad-core Opteron microprocessor designed for corporate servers. AMD lagged

Intel

(INTC) - Get Report

by nearly a year in bringing quad-core chips to market, and the initial versions of AMD's chip sport lower-than-expected clock speeds due to various technical obstacles that cropped-up during its development.

Meanwhile, Intel is set to host its twice-a-year developer forum in San Francisco on Tuesday. The company is expected to provide details about its next-generation microprocessors, as well as new chips developed for mobile products at the three-day event.

Shares of AMD finished Monday's regular trading session up 15 cents at $12.84. Intel shares closed down 8 cents at $24.85.