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. Last Updated: 07/27/2016

Top-Secret Intel Project Has PC Business Abuzz

SAN FRANCISCO -- Some of the nation's top computer chip designers are scratching their heads about what Intel and Hewlett-Packard are up to in a top-secret project to design a new chip -- code-named Merced.

The Merced, set for release within the next two years, represents both an opportunity and a risk for Intel. It would mark the most significant shift in the history of the immensely popular Intel microprocessor family, which began in 1979 with the Intel 8088 chip that powered the first IBM PC and has continued through Intel's latest, the Pentium II.

The Merced would be a departure from that tradition because the chip would use an "instruction set" radically different from the one that has evolved in Intel microprocessors.

The instruction set, etched into the chip's circuitry, comprises hundreds of basic operations, like adding, subtracting, multiplying and moving, which all other components and software in the computer depend upon.

Changing the instruction set for personal computing is akin to introducing a new industry alphabet -- with all the potential for grammatical lapses and communications breakdowns such a fundamental shift suggests.

That change, on top of the perhaps seven-fold increase in the number of transistors packed onto the surface of the chip, portends a greater transformation in the computer industry in the next five years than in the preceding 25 years.

The first Intel personal computer chip in 1979 had 30,000 transistors; the most recent Pentium II has more than 7 million. When it arrives, the Merced is expected to contain 20 million to 50 million transistors, said John Novitsky, a former member of Intel's Pentium chip design team who is now vice president of marketing for the PC component maker Micro Module Systems.

And the chip will probably have a basic clock speed of almost 1,000 megahertz -- more than twice the raw performance of today's fastest chips. Moreover, the Merced will be a 64-bit microprocessor -- compared with the 32-bit limit of the current Intel Pentium. That means the computer can process twice as much information at once.

The consensus in Silicon Valley is that if Intel, the world's largest chip maker, fumbles the shift to the new chip family, it risks damaging its near stranglehold over the personal computer hardware business.

For one thing, the Merced's designers must figure out how to insure that the chip's new instruction set will be able to read and run the thousands of existing MS-DOS and Windows software programs written for Intel's older family of chips -- or risk having more than 80 percent of the world's existing PCs be rendered suddenly obsolete. And yet, the designers will not want to hamstring the Merced's potential to perform at speeds not possible on earlier Intel chips.

Most computer designers now expect the new Merced to be able to adapt to many different types of software written for other chip instruction sets, whether for older Intel chips or other hardware.