March 6, 2000, 8:16PM

Compaq one of first to offer 1-gigahertz chips in its PCs

By DWIGHT SILVERMAN
Copyright 2000 Houston Chronicle

Both Compaq Computer Corp. and Gateway on Monday said they will sell computers that use Advanced Micro Devices' new 1-gigahertz processor, but those who've tested systems say some users may not see a dramatic performance boost.

Both Gateway and Compaq will sell their 1-GHz Athlon systems over the Web and by phone. Compaq won't start taking orders for its Presario 5900z systems until Thursday, but Gateway immediately started offering its Select 1000 model on its Web site Monday.

Compaq's delay allows the company to update software on its 9,000 in-store kiosks so its direct sales don't leap-frog sales by retailers.

With Monday's announcement, AMD becomes the first maker of personal computer processors to sell a chip that runs at a gigahertz, the equivalent of 1,000 megahertz.

In doing so, Sunnyvale, Calif.-based AMD beat out chip giant Intel Corp. for bragging rights as the first to deliver a 1-GHz processor. Intel is scheduled to announce a gigahertz version of its Pentium III chip on Wednesday.

AMD advanced its announcement to Monday after learning of Intel's plans to launch its gigahertz chip this week. AMD then moved the announcement again, to 12:01 a.m. Monday, just in case Intel decided to move its launch to Monday.

Neither Compaq nor Gateway will say whether they will offer a gigahertz Pentium III. Santa Clara, Calif.-based Intel has had trouble delivering enough of the fastest chip in its current lineup, an 800-MHz Pentium III model.

"You should not construe this as us abandoning Intel, especially on the commercial side," said Mark Vena, Compaq's director of consumer desktop marketing. "We are still Intel's biggest customer."

Compaq's stock closed Monday at 27, up .

The new Presario 5900z will start at about $2,000, depending on how it's configured. Vena said a good average price is around $2,500, which includes a 17-inch monitor, 128 MB of memory, a 30-gigabyte hard drive, a 16-MB video card, 40X CD-ROM drive and a 56K fax modem.

Gateway said its systems will sell for about $3,000, but by configuring a system on its Web site, it's possible to get a gigahertz computer in the $2,500 range.

The chips alone aren't cheap. AMD is selling the 1-GHz Athlon for $1,299 each in lots of 1,000, though big customers such as Gateway and Compaq typically get better deals than that.

AMD also introduced 900- and 950-MHz Athlon processors Monday, but those will not be available in systems until later this month.

Steve Lapinski, AMD's director of product marketing, said Compaq and Gateway will get the initial batch of gigahertz chips. Other manufacturers will receive the processors next month, he said.

Reviewers at some computer magazines already have had a look at the Gateway and Compaq systems, having been sent advance units.

At PC World, Senior Editor Laurianne McLaughlin said the gigahertz Presario system her magazine tested showed only an 11 percent increase in business-application performance over a similarly configured model with an 850-MHz Athlon chip.

McLaughlin said the limiting factor is the Athlon's level-two cache, a buffer that stores information before it is sent into the processor.

She said the Athlon's cache is a separate component that's not a physical part of the chip, and thus runs at half the speed of the processor, or 500-MHz.

"That is dragging down the performance of the Athlon," McLaughlin said. "AMD knows this, and in the next version of the Athlon, code-named Thunderbird, they will have L2 cache on the chip itself."

However, McLaughlin said the gigahertz Athlon offers a more significant performance boost for 3-D games. Compaq is marketing its Presario 5900z at avid gamers, rather than businesses or typical home users.

Of the two, the Gateway was slightly faster than the Compaq in PC World's tests. McLaughlin said a suite of programs that runs in the background on the Presario caused it to run slower than the Gateway.

Michael Miller, editor-in-chief at PC Magazine, said a business-application test showed the Compaq and Gateway Athlon-based PCs were not as fast as a Dell Dimension with an 800-MHz Pentium III computer. Miller said the processor in the Dell has a built-in L2 cache.

However, the Athlon-based systems excelled in 3-D applications and content creation, Miller said. That included programs such as PhotoShop, a high-end photo editor, and Dreamweaver, a Web site designer.