Is Intel's Atom really the future?

Posted by Mike Magee in San Francisco

Intel really seems to believe that the Atom is the CPU of the future. As we  reported earlier today, it showed off future iterations of the Atom and has ambitious plans for the future too.

And it doesn't even seem to care about a British company called ARM and a pretty  important firm called Qualcomm, nor any of the competition.

But the Atom costs quite a bit less than $50, and we believe AMD was right when it said that the existence of the netbook has forced the price of notebooks down.

Is the Atom cannibilizing Intel's other chip business? We bumped into Anand Chandrasekher in the Marriott last night and he is adamant, absolutely adamant,  that it's not cannibilizing any market at all. Certainly, the Atom is shipping in large volumes and certainly it's filled a hole in a market that's otherwise quite flat.

But the revenues generated by the Atom can't be that great, and when Intel showed us a slide of how the Atom had sold like hot cakes, the only numbers there, were shipment numbers and not $$$$.

And if people start building big servers with array after array of Atoms, what's  that going to do to the still very lucrative Xeon business?

One thing that Chandrasekher does believe is that the industry could go further  to educate the non-tech person on what they're actually buying when they get a netbook.

In retail stores there are rows of netbooks and fully fledged notebooks all sitting next to each other  and if you don't know the specs, then you could be forgiven for thinking that the cute and dinky netbook you're buying will be good enough for what you need.

That's certainly not necessarily so, and if you do buy a netbook or a notebook and you end up thinking it's going to fit the needs of media manipulation big time,  then you're going to end up disappointed.

Chandrasekher does accept this, and mentioning it to him obviously has started him thinking.

The machine I use is a high end notebook but it's slim and light. Returning to  the UK from Italy, a security guy asked me to take the machine out of my bag. Ah, he said, a netbook. No, I said, it's a notebook. No, he said, it's a netbook. I noticed he was packing a gun. I decided not to push the point.