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Sources at Taiwanese notebook makers have confirmed reports that Intel will postpone the debut of its next-generation Pentium M processors, codenamed Dothan, to the first quarter of 2004 from year-end.

Intel Taiwan, however, denied the news, saying that it had not received such information from the company’s headquarters and that volume production of the processors should start in the fourth quarter as scheduled.

According to sources, the delay was mainly caused by problems in heat dissipation and transitioning in manufacturing process, as the Dothan processors, featuring higher speeds, will adopt 90-nanometer (nm) processing instead of the 0.13-micron processing used for Pentium M Banias processors.

To ensure a smooth transition, Intel also plans to add a 1.7GHz Dothan processor to its new product list. Originally, the chip giant had planned to start its Dothan processors at 1.8GHz, according to sources.

As its current Banias processors still enjoy strong sales, Intel may not feel a strong need to push for the new product launch, which would depress the prices of the current products, sources added.

As sales of the new Dothan processors are not expected to pick up sharply in the beginning due to their relatively high prices, Intel may sustain falling profits if it moves quickly into the new-generation Pentium M processors, sources said.

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