Intel, which revealed a host of new details about its Pentium 4 processor this week at the Intel Developer Forum, is betting the chip will become the most desirable engine for high-horsepower PCs. But for analysts attending the conference, the big question was: why pay more for a Pentium 4 when a Pentium III may be faster? At the Developer Forum, the chip maker used two near-production systems to show off the Pentium 4's multimedia capabilities, including real-time video capture and 3D graphics rendering. "Everything is much faster, but it's not going to run as fast as a 1.5GHz Pentium III chip would, if you had that," said Steven Leibson, editor-in-chief of the Microprocessor Report. The current Pentium III tops out at 1.13GHz. Slated to ship in the fourth quarter, the Pentium 4 promises higher clock speeds -- including 1.3GHz, 1.4GHz and 1.5GHz early next year -- but analysts said it would not blow Pentium III out of the water. In fact, compared with a Pentium III chip at the same clock speed, the Pentium 4 could run up to 20 percent slower, some analysts said. Although its clock speed doesn't necessarily translate into a doubling or tripling of performance, it will give Pentium 4 a decent boost. How will the Pentium 4 perform alongside Advanced Micro Devices's Athlon chips, with its Mustang processor core? Since analysts have yet to receive chips to test, Leibson said. "It's too soon to tell." The Pentium 4 does have other advantages over the Pentium III, analysts said. It packs an improved floating point unit and a new set of multimedia instructions, called SSE2, that allow the chip to process multimedia in parallel, thereby speeding performance. So far, no software optimised for the Pentium 4's architecture has been announced, and that makes for another performance hit. That will change as developers begin to write applications for the architecture and the SSE2 instruction set. Instead of optimising the design for the current generation 0.18-micron technology, Intel "made the [Pentium 4] design to take much better advantage of the next process step [0.13]," said Leibson. Mike Feibus, principal analyst at Mercury Research, said the end result will be a chip that runs anywhere between 20 percent and 200 percent faster, depending on the application. Consumers who buy a Pentium 4 system to use as a word processor will see only a relatively small bump in performance. On the other hand, consumers using it for high-end graphics will see a significant improvement, according to Feibus, who said, "I think [Intel] is going to focus on audio/video enthusiasts." Pricing is also likely to preclude buyers of most PCs -- usually priced in the $900 to $1,000 range -- from using the new chip to write email. Analysts such as Feibus predict Pentium 4 systems with Rambus direct RAM (RDRAM) will run at least $2,000 to $2,500. That makes sense in the early stages, he said, "When you look at the makeup of the market today, even AMD isn't shipping hundreds of thousands of high-end chips." The chip measures 217mm square, sources said, roughly twice the size of the Pentium III. With its manufacturing capabilities already constrained, analysts said Intel is unlikely to produce the Pentium 4 in any significant volume until the company implements the 0.13-micron manufacturing process. Intel's Albert Yu acknowledged the Pentium 4 would come with a higher price tag, "But as the volume builds [prices will fall]. There's nothing new here." Even with the additional cost of RDRAM, Yu believes that customers will still chose Pentium 4. "The pricing is very much in the hands of the RDRAM suppliers," Yu said. "We're working with them on that issue. A little premium over SDRAM is okay, but not what we've got now. The premium is way too high," he said. Intel chose Rambus, he said, because, "When we introduce a new platform, we should deliver the best possible performance. We believe that the Pentium 4 with RDRAM will be the best possible performance." "As a consumer, if I could get something more interesting for a couple hundred more, I would do it," Yu said. But the Pentium III chip will live on for "some time", he said. As Yu sees it, the Pentium 4 will be at the high end of Intel's product line, the Pentium III will remain in the mainstream, and Intel's Celeron chip, made for value PCs, will cover the low end of the market. Consumers may adopt Pentium 4 first, but companies will likely stick with the Pentium III until Pentium 4 prices come down. The Pentium 4 is larger than the Pentium III, which means the newer chip has room for more transistors: 42 million, compared with 28 million for the Pentium III. Intel also disclosed that the Pentium 4's Level 2 cache size will be 256KB, and it will get a 400MHz system bus. The system bus provides a pipeline between the chip and I/O subsystems of a PC, such as memory. At the forum, Intel demonstrated versions of the chip running at 1.4GHz and 1.5GHz. During his Tuesday keynote speech, Yu showed off a 2.0GHz Pentium 4. The demonstration, designed to show the new chip's potential, began with a Pentium 4 system with a chip running at 1.5GHz and rose to a clock speed of 2.0GHz without any special cooling. The Pentium 4 is not expected to reach 2.0GHz until the latter half of 2001. The demo was really meant to show the chip's potential, Yu explained. So, in order to pull it off, Intel picked a Pentium 4 chip that was running at a higher clock speed. When processors are manufactured, they yield a fairly wide distribution of clock speeds, much like a bell curve. Intel went to the high-end of the curve, choosing a Pentium 4 chip running at 1.8GHz, or possibly 1.9GHz, and tweaked it to run at 2.0GHz. Adjustments were also made to the system bus for the demonstration. See Chips Central for daily hardware news, including an interactive timeline of AMD and Intel's upcoming product launches. What do you think? Tell the Mailroom. And read what others have said.