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Intel's CEO talks about the Atom processor

Intel's Atom processor has been labeled as the Holy Grail of small-scale mobile computing. Now, however, Intel CEO Paul Otellini has changed his tune a bit with regards to Intel's Atom processor. Otellini was asked by reporters during the company’s quarterly conference call to expound upon his thoughts on the diminutive, 45nm processor and how its place in Intel's product lineup would affect other low-end processors like the Celeron.

"We do not see [Atom] replacing Celeron," said Otellini. "If you look at the netbook products being built around Atom, they’re all lower-priced, lower features, smaller screen size notebooks aimed at first-time buyers or the second, third or fourth machine in a household. We don’t see any cannibalization."

When pressed further, Otellini went into further detail with regards to the performance of Intel's Atom processor. "[Atom] is less than a third of the performance of our Centrino (high-end mobile processor)," added Otellini. "You’re dealing with something that most of us wouldn’t use."

The company first began making rumblings about the processor at last year's IDF in San Francisco and earlier this year officially announced Silverthorne and Diamondville as the Intel Atom.

In early March -- shortly after the official announcement of Atom and Centrino Atom -- Intel Otellini hailed that the chip would help the company tap into $40 billion USD worth of new markets.

"It’s not just the 1 billion people that have access to the Internet now. It’s the next 2 billion people," said Otellini in March. "It’s not just about selling more PCs, but bringing new devices and new price points to bring those people onto the Internet. We are not talking about repurposing old silicon, but designing new silicon for each of these different areas."

It's quite puzzling that such a comment would come from Intel's CEO given the company's insistence on the importance of Mobile Internet Devices (MIDs) based on the Atom platform. There's also the fact that Microsoft even opened up its arms to embrace Windows XP Home a bit longer for "netbooks" – a classification of low-cost notebooks that Intel itself coined.

Small netbooks ranging from the MSI Wind to the Eee PC 901/1000h to the Acer Aspire One all use Intel's new 1.6GHz Atom processors. Companies like Dell and HP aren't that far behind with their own Atom-based offerings at all.





"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer



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