Digital chipping away at Intel

Digital Equipment Corp. has announced a line of low-cost Alpha chips aimed at giving users an alternative to Intel PCs in the Windows NT space. But a relative lack of native Alpha applications and falling Intel PC prices could once again limit the chips' appeal to a narrow segment of users. Despite the low cost of the chips, systems based on the latest Alphas are still likely to cost more than Intel PCs.

Digital Equipment Corp. has announced a line of low-cost Alpha chips aimed at giving users an alternative to Intel PCs in the Windows NT space.

But a relative lack of native Alpha applications and falling Intel PC prices could once again limit the chips' appeal to a narrow segment of users. Despite the low cost of the chips, systems based on the latest Alphas are still likely to cost more than Intel PCs, analysts say.

In its most aggressive bid yet to expand the market share of its Alpha RISC chips, Digital has released the Alpha 21164PC chip, which it co-developed with Mitsubishi Electric Corp. in Japan. The chips are low-cost versions of Digital's existing Alpha chips and will be available in three clock speeds. Prices start at US$285.

Systems based on the chip will offer top-of-the-line Pentium performance at prices much lower than previous Alpha systems, analysts said. Digital said PCs that run its new Alpha chips will start at less than $2600, compared with more than $4000 for previous entry-level Alpha systems.

"There is no question that Digital's new chips fall in the same competitive category as Intel" as far as performance is concerned, said Dean McCarron, an analyst at Mercury Research Inc.

Digital says it will use the chips in future systems but didn't specify when it will start to ship them.

"Alphas are already known to be pretty solid chips. It looks like the new ones are going to give even more bang for the buck," says Thomas Joyce, a software engineer at Carnegie Mellon University in Pittsburgh.

The university has investigated Alpha systems but hasn't installed any, mainly because of the price, he says.

"I have always been envious of Alpha performance, but it has been a little pricey for us in the past," Joyce says.

Digital's new chips and associated hardware, such as the core logic and motherboard, will let systems vendors build PCs that are closer to Intel prices. But not close enough, analysts say.

"When Digital started on this chip, they were targeting the mid-$2000 market," which was the volume sweet spot, said James Garden, an analyst at Technology Business Research Inc.

But in the past few months, several PC vendors have begun to offer Windows NT systems at even lower prices. And Compaq Computer Corp. recently announced a sub-$1,000 system that is expected to have a ripple effect across the PC industry, analysts say.

A lack of native NT applications also could severely hamper acceptance of the new Alpha chips, analysts said. Digital claims there are about 1,800 32-bit NT applications available on Alpha; that figure is well below the 15,000 to 20,000 applications on Intel platforms.

Join the newsletter!

Error: Please check your email address.
Show Comments
[]