AMD Monday announced volume shipments of its new low-cost processor, Duron, which competes with Intel's Celeron in the sub-£600 PC market. As reported last week by ZDNet UK, Duron is available immediately in speeds of 700MHz, 650MHz and 600MHz. Vendors who have announced Duron plans include IBM, Fujitsu-Siemens, Compaq and Hewlett-Packard, among others. The chips are priced at $192, $154 and $112, respectively, in 1,000-unit quantities. The new chip is eventually to replace AMD's K6 line, although the two will co-exist in the near term. Two weeks ago the chip maker said Duron had begun shipping to manufacturers in limited quantities. In recent months AMD has focused its energies on preparing several chips for the mainstream and high-end segments of the PC market, leaving what some industry observers call a hole in its value product line. That is because the K6-2 processor maxed out at 550MHz weeks ago, stalling further advances until Duron's launch, according to research firm MicroDesign Resources. Intel's Celeron value chip runs at clock speeds up to 600MHz. Duron will represent a renewed launch into the value space for AMD, bringing Athlon core architecture into the market for cheap PCs. These usually cost under $1000(about £600), with the microchips priced from $70 to $180. The new generation of Athlon, formerly code-named Thunderbird and announced two weeks ago, will be available in the new, less costly Socket A packaging, with Slot A packaging available to OEMs. Duron, however, will only be available in Socket A format. Socket A is smaller and less costly to manufacture, and it is made possible by the integration of the Level 2 cache onto the chip die, which reduces the overall size of the chip. (The L1 and L2 caches are used to store data and instructions frequently used by the system.) Duron will begin shipping at 600MHz, 650MHz and 700MHz, with a 750MHz chip to come later. Despite this latest value chip, however, AMD still faces a potentially serious threat from Intel, in the form of Timna. Timna goes a step beyond Celeron, integrating even more components -- such as graphics and memory -- into the chip itself: the strategy means Timna will be super-cheap to manufacture, while still delivering good performance. The chip is aimed at the sub-£600 PC market. Intel recently delayed Timna until next year because of problems related to the use of Rambus memory, designed to run faster than standard SDRAM. Go to our Chips Central 'news special' which include a Flash-based interactive timeline to illustrate new product launches from AMD and Intel from now -- through Q1 2001. Updated daily. What do you think? Tell the Mailroom. And read what others have said.