A recent column summed up the feeling of processor analysts that Intel's severe Pentium 4 discounting was a solar plexus blow trying to cripple AMD's strong market position in consumer PCs. But Ben Anexter, Advanced Micro Devices Inc.s' vice president of external affairs, responded that his firm is ready to take whatever punches Intel throws, and wonders if Intel won't end up hurting itself far more.

Seems proper that AMD gets its say in response to Intel and analysts on the impact of Pentium 4 price bludgeoning. For the record, this is AMD's take:

Anexter cited many analysts' reports that the big 217-mm square Pentium 4 chip eats up a lot of silicon and is expensive to produce. In addition, Intel has been bundling the processor with Direct Rambus DRAMs at discounted prices, to offset the much- higher RDRAM premium over conventional SDRAM. Intel has also been offering OEMs a $65 rebate for every Pentium 4-based PC shipped.

Now by cutting Pentium 4 prices drastically, Intel is taking a further big hit in profit margins on the chip, AMD claimed, again echoing some analysts.

The AMD official said his own firm's Athlon processors are returning among the highest profit margins ever received. "And if Intel thought it was going to hurt AMD financially by steep Pentium 4 price cuts, that isn't going to happen. AMD has $1.6 billion in cash on hand. We have $800 million in debt (from loans to build and equip the new Fab 30 in Dresden, Germany) but we don't have to start paying that back until 2003 and even then we have German government subsidies to help on interest payments."

Analysts had speculated that Intel's Pentium 4 bloodletting was trying pull the rug out from under AMD's strong consumer PC position. However, slashing Pentium 4 prices in half still leaves the Intel processor more expensive then AMD's Athlon, on a speed grade-by-speed grade comparison, Anexter claimed.

AMD itself last week cut Athlon prices, but the chip firm official maintained it was a previously-scheduled reduction to reflect routine production cost declines, and not in response to Intel taking the scalpel to its Pentium 4 price tags.

Anixter claimed Intel was forced to cut Pentium 4 deeply simply to jump-start the processor after a disappointingly slow start in the market, a charge that Intel denied. The MPU giant also said it was cutting prices to reflect lower Pentium 4 production costs.

AMD maintained it didn't need to cut Athlon prices to boost sales, as the firm for more than a year has been able to sell every performance processor it can produce.

Intel's Pentium 4 production cost will drop dramatically when the firm transitions to 0.13-micron processing starting in midyear. The chip size drops 35% to 140-mm square, using far less silicon with a corresponding big jump in die yields.

Anixter said AMD "will only be a few months behind Intel in moving to its own 0.13-micron processing at the Dresden fab. The Athlon chip size also shrinks, and at 80mm-square it will be half the size of Intel's Pentium 4 0.13-micron version."

For all its bravado, AMD still is trying to break into the corporate PC market in a major way to crack a virtual Intel PC stranglehold.

AMD has signed up NEC and Fujitsu to use Athlons in their business PCs sold in Europe. And officials insist more Athlon design wins are coming in the corporate PC space.

AMD's splash later this month in the notebook market with its Nvidia chip set-supported Palomino processor will bear watching. As reported by EBN, the dual-memory-channel Palomino notebook will have 4.2-gigabyte/second data rates, higher than even most desktop PCs.

For now the two microprocessor pugilists are slugging it out toe-to-toe, taking whatever body blows are thrown. But neither has come up with any knockout punch