Via is the first third-party supplier with a Pentium 4 chip set for the mainstream PC market. The company said it will ship the P4X266 chip set in August whether it has a license for the Pentium 4 bus from Intel or not, and has secured the cooperation of Taiwan's top motherboard makers, which will begin shipping boards around the same time. During a limited benchmarking demonstration Tuesday, Via ran a 1.5-GHz Pentium 4 with an Intel 850 chip set and Rambus memory against a Pentium 4 with Via's X266 chip set and DDR memory. On a 3D Mark 2001 test, the X266 showed roughly 8 percent better system performance, according to Via.

Rush to demo

Via received the first functional X266 chip set from Taiwan Semiconductor Manufacturing Co. Ltd. last week, and fully tested it Monday night. At that point, Via assessed the benchmarks and decided to roll out the chip set on Tuesday during what was primarily an event for a Cyrix C3 CPU. "We ran it, saw the results and knew we had beat them Intel with first silicon," said Shane Dennison, an international marketing manager with Via.

An industry source familiar with the Intel-Via negotiations said that Via feels little pressure to deal with Intel for a new license since it acquired S3 Inc., which had signed a cross-license agreement with Intel before the acquisition. Via should be close to a deal with Intel by the time the chip set comes out, the source said, but will hold out for better a better deal than other third-party chip set makers.

"Acer and SIS Silicon Integrated Systems Corp. signed up right away because they had very little to offer," the source said. "But Via can hold out because they have a lot to bring to the table. If they want to be really nasty, Via can release it without a new license. So Intel can get something or nothing."

Via seems determined to put the chip set on the market first and ask questions later. Via has tangled with Intel in the past and has come through largely unscathed, with an out of court settlement last summer concerning its Pentium III chip sets. For most of its history, Via has lived a sort of symbiotic and confrontational existence with Intel, believing that Intel will bark at but not bite the company that supplies at least 40 percent of the market with chip sets for Intel processors.

Via's closest competitors, Silicon Integrated Systems and Acer Laboratories Inc., already have licenses for the Pentium 4 bus, but have not rolled out their DDR core logic. Most industry watchers in Taiwan agree that Via is probably weeks and possibly months ahead of its Taiwanese rivals. For its part, Intel has said it will not deliver Pentium 4 chip sets that support DDR memory until the first quarter of next year at earliest.

Analysts speculate that Intel is so eager to ramp up the Pentium 4, especially during the semiconductor industry downturn, that it's unlikely to muddy the picture by trying to deter Via. At Tuesday's demonstration, Via chief executive officer Chen Wen-chi said his legal department had advised him that Via had nothing to worry about. However, he acknowledged that Intel might sue. "They always do," he said.