Intel will catch up by tomorrow with its 350MHz and 400MHz Pentium II processors (formerly known as Deschutes) using a 100MHz bus (instead of a 66MHz bus). It will also introduce Celeron, its cacheless 266MHz Pentium II designed for low-cost desktop PCs. Cyrix's M II line is based on the existing Socket 7 motherboard and chip set architecture, which is well-entrenched and cheaper than newer Slot 1 designs. The M II, which replaces the 6X86MX line, will enable PC makers to deliver high-performance systems for less than $1,500 (£900), said Stan Swearingen, senior director of business development and marketing at Cyrix in the US. Because the chip and its surrounding components are cheaper than Slot 1 parts, Swearingen expects OEMs to add performance-enhancing features like memory or better graphics and still keep price tags low. He added that several leading manufacturers are interested in M II-based products and will release them in the coming months. "We know the tire kickers from the evaluators. People are interested,'' Swearingen said. Although he declined to name the interested companies, Compaq and IBM are likely customers. Compaq, for example, has demonstrated a willingness to use non-Intel processors to hit low price points while maintaining respectable margins. Compaq officials declined to comment on unannounced products but acknowledged a continued push into low-cost segments. "We will evaluate whatever technologies possible to be a leader at all price points,'' said Michael Takemura, Deskpro product manager at Compaq in the US. Cyrix is banking on demand from small and medium-sized businesses, which are becoming more concerned with low prices and high performance than with the Intel brand. "This will crush Celeron in performance,'' Swearingen said. Early independent testing appears to bear him out. According to the Microprocessor Report in the US, a 266MHz Celeron will perform no better than a 233MHz Pentium Processor with MMX Technology. Cyrix will follow today's announcement with a 333MHz version of the M II next month, a 350MHz processor by midyear and a 400MHz version by year's end. The M II 300 will be priced at $180 (£107) in 1,000-unit quantities.