SAN JOSE -- Intel Corp. is at it again. The world's largest chip maker today outlined plans to integrate more functions on PC chip sets, ostensibly to drive down the costs of personal computer platforms.

During presentations at the Intel Developer Forum (IDF) here today, the general manager of Intel's Desktop Products Group said the company plans to integrate the Universal Serial Bus (USB) 2.0 technology into its PC chip set lines by the fourth quarter of 2001. The move poses a threat for suppliers of standalone USB chips, including Cypress, NEC, and others others, noted analysts.

Intel has certainly changed the market landscape before by integrating functions into chip sets. For example, the company integrated the graphics functions into chip sets several years ago, a major move that eventually played a factor in the shakeout and death of the standalone graphics IC suppliers.

Today's announcement is likely to send some USB suppliers scrambling, but Intel tried to put a positive spin on the strategy. "What that means is that we will make USB 2.0 ubiqutous in the marketplace," said Louis Burns, vice president and GM of the Desktop Products Group.

The Intel executive provided no details about the integration roadmap for USB 2.0 functions, nor did he describe which chip sets will be involved in the strategy this year.

In his keynote address at IDF, Burns said the next challenge for systems manufacturers is to leverage USB 2.0 and related I/O bus technologies vs. just focusing on the higher speeds of central processing units.

"We think the CPU side is done," he said, referring to the near-term improvements in performance made possible by faster microprocessors. "The thing that needs work is I/O," he told developers at the conference.

The Intel executive outlined several technologies that will boost the I/O in a system, including the IEEE 1394 serial link, Infiniband-based communications technology, and Serial ATA connections for mass storage. Another key technology favored by Intel is its 3GIO bus, dubbed "Arapahoe." This technology is a chip-to-chip bus I/O technology designed to replace the exiting PCI architecture.

Recently, Intel received huge endorsement for 3GIO from Compaq, Dell, Microsoft, among others.

"The preliminary 3GIO spec is underway," Burns said. "The final spec will be out by mid-2002."