SANTA CLARA, Calif. - Intel Corp., the world's biggest semiconductor maker, said yesterday that it built a test chip with a new process that creates faster circuits by packing 10 million transistors into an area the size of the tip of a ballpoint pen.
Intel has made the first working memory chip that uses so-called 65-nanometer technology to shrink the circuits inside chips, Intel researcher Mark Bohr said in a conference call. The method lets Intel pack twice as many transistors into the same space.
Chip makers such as Intel and International Business Machines Corp. are racing to design production methods that let them cram more transistors into chips, resulting in more powerful devices that cost less to make. By being the first to use circuits measuring 65 nanometers, Intel is up to 12 months ahead of competitors, said Gartner Inc. analyst Martin Reynolds.
"It means that we will see new, faster products that keep the market cooking," Reynolds said. Intel had been about six months ahead of its competition, he said.
Advanced Micro Devices Inc., Intel's main competitor in personal-computer microprocessors, is upgrading its plants to 90-nanometer production. A nanometer is one-billionth of a meter.
Texas Instruments Inc., the world's biggest maker of mobile-phone processors, will begin selling chips made with 65-nanometer wires late next year, a schedule it announced in March, spokesman Gary Silcott said. Clients will be able to get samples of the processors in the first quarter of next year, he said.
Shares of Intel, the worst performer in the Dow Jones industrial average this year, dropped 42 cents to close at $21.60 yesterday on the Nasdaq stock market. They have fallen 33 percent this year.
Intel is on track to make semiconductors in keeping with Moore's Law, an observation named after Intel founder Gordon Moore that chips double in density every two years, Bohr said.
Chips made with the new technology will be released next year, he said. Intel announced the manufacturing method in November.
Intel, whose processors power 85 percent of the world's PCs, is trying to overcome a series of manufacturing setbacks. The company delayed this month the release of a chip for large, flat-panel televisions and already had moved back production of two PC processors and canceled development of a third this year.
Analysts forecast Intel's sales growth to slow to 10 percent next year from an estimated 15 percent this year.