... larger wafer are negligible.
"Every day will make the wafer costs go down because we will have better utilisation and the die costs will go down due to the conversion to 65-nanometres," Rivet said. The company will also be able to produce more chips from the same wafers in order to satisfy demand, and performance are also likely to improve.
Intel, however, made the move to 65 nanometres in the fourth quarter of 2005, and to 300-millimetre wafers some time ago. Its Core Duo chip was its first processor built using the smaller transistors, and it announced earlier this month that it is now shipping more 65-nanometre processors than 90-nanometre chips.
This has given Intel the flexibility to leapfrog AMD to the quad-core generation of processors. Intel plans to build quad-core chips by taking two separate dual-core processors and putting them together in a single package, which it calls a multichip module (MCM).
The MCM allows Intel to get its designs out into the market faster than AMD. Intel's first quad-core processors are expected to become available next month, but AMD is waiting until the middle of next year to unveil its quad-core server processor.
It also allows Intel to maximise its yields by building smaller chips. For example, if one of the dual-core processors in the MCM gets knocked out by a defect, the whole product doesn't have to be tossed. Intel will still need to build dual-core chips for the mainstream and lower ends of the market for several years. It can build dual-core chips for those markets, and simply package two dual-core chips when it wants to ratchet up the performance.
AMD's chips are based on a different design from Intel's, and so the company believes it benefits most from an integrated core design, where all four cores on its quad-core chips will live on a single piece of silicon. Each processor core will be connected by a fast HyperTransport link that allows signals to flow between the cores at the chip's clock speed without having to leave the die. Intel's design means that if a core on one processor wants to exchange information with a core on the other processor, they have to do so at rates slower than the chip's clock speed, since the signals have to travel through the package.
Some chip enthusiasts — who occasionally resemble architectural critics — aren't too impressed with the MCM approach, since it fails to address Intel's reliance on external communications links to exchange information between processors. This was one of the factors that led to AMD's performance advantage up until the introduction of Intel's Core microarchitecture processors, which outdo AMD's chips on several benchmarks.
Intel thinks its quad-core processors will be extremely competitive on performance and power consumption, in part because the company will boost performance between now and when AMD's quad-core chips are ready, said Bill Kircos, a company spokesman. Still, Intel will use a mix of monolithic and MCM quad-core designs in the future, depending on the need for performance, low-cost chips, volumes, and speed, he said.
AMD's monolithic design also means its die sizes will likely increase when it moves from dual-core 65-nanometre processors to quad-core 65-nanometre processors, raising the cost and margins issue once again. Earlier this year, AMD showed it recognised the need to catch up to Intel's manufacturing pace with the announcement that it plans to introduce 45-nanometre processors just 18 months after rolling out its 65-nanometre chips, a transition that usually takes at least two years. But if it can continue to deliver performance that makes server customers drool with its quad-core chips, the cost questions will be overshadowed by the revenue padding its bottom line.
