AMD starts selling its top-end chips for desktop PCs made with a 65-nanometer design today, continuing its efforts to keep up with Intel as the industry migrates from 90nm design to a faster, more efficient generation of processors.

By manufacturing its dual-core Athlon 64 X2 chip on the smaller geometry, AMD will be able to increase output while improving the chips' performance and power efficiency, said Jack Huynh, a market development manager for AMD.

Some PC vendors are selling the new chip in computers already, and by the first quarter of 2007 that list will include Acer, Dell, Founder Electronics, HP and Packard Bell, according to AMD.

The move to 65nm manufacturing is crucial for AMD as the company strives to keep up with a flurry of new processors from Intel. Intel had a rough year in 2006, losing ground to AMD in market share, but has rallied in recent months. The company launched its Core 2 Duo family of desktop chips in July and its quad-core Core 2 Extreme in November. Intel switched its chip manufacturing plants to a smaller architecture months ago, and already sells more 65nm chips than 90nm chips.

A chip made with 65nm process technology has smaller components - such as transistors and the wires that connect them - than a chip made with 90-nm technology, said Rob Willoner, a technology analyst with Intel's technology and manufacturing group. That progression is the engine that drives Moore's Law, the prediction that the number of processors on a microprocessor will double every 18 months.

One nanometer is one-billionth of a metre, meaning that the wires on 65nm design chips are far slimmer than human hairs. Minuscule as that is, chip vendors already have plans to shrink the parts even smaller. Intel has already announced plans to use chip features of 45nm by 2007, 32 nm by 2009 and 22 nm by 2011.

AMD chose to apply the new "Rev G" 65-nm design to its high-end, dual-core desktop chip first because the company's mid-range, single-core Athlon and Sempron chips are already fairly efficient, running at 62 watts using a 90nm design, said AMD's Huynh.

The Athlon 64 X2 operated at a high 110 watts when it was first launched in June 2005, but this migration will bring it down to just 65 watts, he said. AMD will continue to produce both 90nm and 65nm Athlon 64 X2 chips until it phases the larger-design chips out completely by the second half of 2007.

Next, AMD plans to apply the 65nm design to its single-core Athlon and Sempron chips, shrinking them by the end of 2007. And the company has already begun work on the next step, shrinking its chips to a 45nm design, although AMD did not give a specific date for that goal.