Intel Halts 1.13GHz Pentium III Shipments

An official for Intel Corp. on Tuesday said "recall" is too harsh a word for the company's decision to retrieve and retool an undisclosed number of faulty 1.13GHz Pentium III processors.

Not wanting to argue semantics, Intel spokesperson Howard High said that the advantage of having only "a small number" of the faulty chips to replace, combined with the fact that the 1.13GHz Pentium III was targeted at a relatively small initial user base and not widely distributed, makes Intel's decision something less than a recall.

The early adopters that placed orders for the 1.13GHz Pentium III are "the kind of people that Intel wants to develop a strong relationship with," said High.

When asked if the problems with the 1.13GHz Pentium III might strain that strong relationship, High replied "I don't think so."

"We are bringing a potential issue to the user, and not the other way around," said High. "[These customers] buy Intel because they expect a certain quality level. So if [Intel] comes to you and says these are not up to our level of quality, that reassures them that this company is very conscious of the quality, and it reinforces one of the reasons people buy the Intel brand."

The glitch that caused Santa Clara, Calif.-based Intel's fastest Pentium III processor to fail also caused both IBM and Dell Computer on Monday to stop taking orders for the 1.13GHz Intel chip, according to officials for both computer makers.

The news came on the same day chip rival Advanced Micro Devices (AMD), in Sunnyvale, Calif., began shipping its 1.1GHz Athlon processor in volume.

With few details, Intel spokesperson George Alfs said that when the processor "hits a certain speed at a certain temperature while running certain code in certain units," the processor fails.

Apparently, the problem was discovered by either or, both hardware testing companies that were provided with motherboards of the faulty chip from Intel for review, said Alfs.

Intel technicians have been able to replicate the problem brought to the company's attention by those outside testing sources, said Alfs. Based on those test results, Intel has stopped production of the chip, and won't resume production until the problem is identified and corrected, Alfs said"We'll pull these [processors] back and fix the problem and ship new parts out in a couple of months," said Alfs.

Dell, in Round Rock, Texas, had been taking orders for the processor for shipment within its Dimension XPS B desktop PC line since the launch of the 1.13GHz Pentium III CPU on July 31, said Dell spokesperson Tom Kehoe. But Dell has stopped taking orders for units with the bad chip, and began contacting customers, offering them the slower, 1GH Intel Pentium III processor as a substitute.

No Dell customers received units with the faulty processor, according to Kehoe.

Armonk, N.Y-based IBM pulled its high-end Aptiva featuring the Intel 1.13GHz processor from its Web site after learning of the problem, said Tim Blair, a spokesman for IBM's personal systems group. Big Blue had shipped some desktops with the chip, but sales so far have been limited, he said.

"The volume was very light because it's brand new," Blair said. IBM will contact customers who have already received systems containing the 1.13GHz chip, he said.

Intel announced July 31 it would begin shipping limited quantities of the chip to major vendors. Alfs said Intel sells the chip in 1,000-unit quantities for US$990. The number of chips shipped since the end of July has been "very small," according to Alfs, and Intel is working with the vendors who bought the chip to resolve the problem. Consumers who own one of the rare 1.13GHz PIII systems should contact their vendor, and not Intel, to find out what to do, Alfs said.

Intel's announcement came as a surprise to Nathan Brookwood, a principal analyst at Insight64, in Saratoga, California. He said it was rare for the chip maker to have a problem with its products, but he noted rumors were circulating last week on online chip bulletin boards that there might be a problem with the processor.

The 1.13GHz processor speed was pushing the limits of the Pentium III design, Brookwood said. Intel developed the chip as a public relations strategy to state that the company had the fastest chip, he explained.

The faulty chip may be a public relations blunder, but it will not hurt Intel's pocketbook, he said.

"It [the 1.13GHz chip] was not targeted at high-volume sales," Brookwood said. "I can't imagine that it would have any substantial financial impact."

Linley Gwennap, principal analyst at the Linley Group, said he also was surprised by Intel's recall, as the company typically tests its products thoroughly before bringing them to market.

"It has been becoming more of a problem lately," he said, however.

Back in May, Intel announced it would replace PC motherboards designed around its 820 chip set due a faulty component, a MTH (memory translator hub), Gwennap said. He suggested that Intel is perhaps experiencing a run of bad luck and also may be dealing with pressure from chip competitor AMD.

Gwennap said Intel had a short turnaround time to get the 1.13GHz chip to market and position the company back out front again with the fastest chip.

"The immediate consequence of this is pretty minor," Gwennap said about the chip recall. "If you stack it all up with the other miscues, it just reduces confidence with PC makers and makes them look elsewhere for [supplies]."

Dan Neel is an InfoWorld reporter. James Evans is a Boston correspondent for the IDG News Service, an InfoWorld affiliate. Tom Mainelli is an editor/reporter for PC World.

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