Intel is making over its Celeron chip. The company on Wednesday will announce new 566MHz and 600MHz versions of the chip, with a number of new features aimed at raising clock speed and overall performance for lower-cost PCs. The new chips offer higher performance, but with the line held on pricing. Consumers will be able to buy a 600MHz PC for about $1,000 without a monitor, and Celeron systems will continue to be available at prices ranging from $600 to $1,000, with the new chips occupying the higher end of the scale. The new Intel chips will cost $167 apiece in lots of 1,000 for the 566MHz and $181 for the 600MHz. "The competition (between Intel and AMD) is yielding some pretty hot performance at some pretty good prices," said Mike Feibus, principal analyst at Mercury Research. The 566MHz and 600MHz Celerons are the first desktop Celerons to be manufactured using Intel's 0.18-micron manufacturing process. Moving Celeron from the 0.25-micron manufacturing process to 0.18 will allow Intel to increase the clock speed of the chip. The process switch also allowed for the addition of features previously found only in the Pentium III, including Intel's SSE (streaming SIMD extensions) for multimedia processing. The new Celerons will continue to include 128KB of integrated cache, which helps boost performance, as well as support for a 66MHz system bus. These are both unchanged from the previous generation. The bus provides a data pipeline between the chip and a PC's internal components, such as memory. Its speed contributes to the overall performance of a PC. Some PC users may be disappointed that Intel did not increase the chip's bus speed to 100MHz as it did on its mobile Celerons based on the 0.18-micron process. But the company says it is segmenting its desktop product lines. "What we're doing here is we're clearly differentiating our products," said Jeff McCrea, director of marketing for Intel's Desktop Products Group. Celeron buyers, McCrea said, are focused on processor clock speed and overall system price, instead of details such as bus speeds. "Celeron, for these buyers, is a great way to get on the Internet," he said. The way Intel sees it, performance seekers are more apt to pick a Pentium III system, which will have the faster bus and, generally, larger amounts of memory and better graphics. Despite what Intel says, some buyers will compare the two chips. They will find that Celeron and Pentium III chips are closer than ever when matched clock speed to clock speed. But while the new Celeron chips are between 10 and about 55 percent faster than their predecessors, according to Intel, they are still separated from the Pentium III by performance, sources said. Clock-speed comparisons show a 0.18-micron Pentium III 600MHz with a 100MHz bus to be up to 30 percent faster than a 600MHz Celeron on certain benchmarks, sources said. The difference is in the larger cache -- the PIII has 256KB -- but mostly in the faster bus. That said, a 600MHz Celeron chip should provide more than enough performance for most consumers who wish to surf the Web, send email or use applications such as word processors, analysts say. Celerons and PIIIs will now be differentiated by price, clock speed, cache size and bus speed. In the past, the two chips had also been held apart by manufacturing process and multimedia instruction sets. With introduction of the new chips, Intel appears to be making good on a promise it made in the first week of this year to aggressively introduce new Celerons into the value-PC market throughout the year. Closely following the new Celeron speed grades will be two more. Keeping the accelerator down, Intel will release a 633MHz chip and 667MHz chip in late April, according to sources. A 700MHz Celeron chip is likely to arrive by the end of the first half of this year, sources said. "What I think is interesting is that (Intel) has now got two Celeron versions that are faster than the fastest (550MHz) K6-2," Feibus said. "I don't think (AMD) intends to come out with any faster K6-2s for the desktop. That means either AMD is screwed or (Spitfire) is on a very good schedule. I'd bet on the latter." While Intel's appears to have some time on its side, consumers shopping at retail will have other options when it comes to picking sub-$1,000 systems. Advanced Micro Devices is readying a new low-cost chip based on its Athlon processor. Code-named Spitfire, the chip should match Celeron closely in clock speed and price. The chip will also be manufactured on a 0.18-micron process and will include 128KB of integrated cache. It will, however, offer the Athlon's 200MHz system bus. The Spitfire is expected to debut at mid-year. (See: AMD aims at Intel with 'Spitfire') Intel is suffering from what we might call Microsoft Syndrome, the symptoms are rampant and unnecessary paranoia, read the news comment at AnchorDesk UK with Peter Jackson. What do you think? Tell the Mailroom. And read what others have said.