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The Xeon processors usually have similar speeds to Intel's Pentium 4 desktop chips but include some higher-end features such as larger caches that make them more suitable for use in servers.
Intel also offers the 64-bit Itanium processor to server manufacturers, although the 32-bit Xeon processor is still the most popular product.
Analysts were reluctant to speculate on what features Potomac may have but said Intel could prepare a surprise or two by 2004. Mercury Research principal analyst Dean McCarron said Intel was expected to increase the cache sizes on its Xeon chip and push up the chip's speed.
In 2004, however, Intel would be able to take advantage of a new .09-micron manufacturing process, which helps shrink the size of the chip's circuitry and which could open the door for dual-core Xeon chips.
A dual-core chip has two physical processor cores on the same piece of silicon, which makes one chip work almost as effectively as two.
Intel could also make Potomac its first Xeon chip to support both 32-bit and 64-bit instructions for its x86 architecture. Rival Advanced Micro Devices (AMD), will release its Opteron processor this year to give customers both a 32-bit and 64-bit option for lower-end servers
Intel has been rumoured to be working on a similar chip to Opteron, but a number of industry sources speculated that Intel dropped this project as a result of Microsoft's support for AMD's 64-bit processor design. Microsoft was reluctant to support two of the so-called x84-64 architectures and sided with AMD instead of Intel, the sources said.