Intel and the PC industry are about to go through a major change in the way desktop computers are designed, built and marketed, said Intel President and CEO Paul Otellini during his introductory address Tuesday at the Fall Intel Developer Forum in San Francisco.

Otellini officially pronounced the megahertz era dead during his talk. Intel has gradually shifted over the past two years away from its former marketing strategy based on ever-increasing clock speeds to a plan that improves performance with new features and technologies.

The company will focus on parallel processing with future products, Otellini said. This will include multicore processors, virtualization technology and a continuation of Intel's hyperthreading technology, he said.

Analysts had been hoping that Intel would provide more details about plans to introduce dual-core processors in 2005, which it abruptly announced in May. Otellini did not take the bait, declining to even provide the code names of the upcoming processors. He did reiterate that the company would introduce dual-core chips for desktops, servers and notebooks in 2005, with most of the growth coming in 2006.

However, in a briefing for reporters after his speech, Otellini confirmed that Yonah will be the code name for Intel's first dual-core notebook chip. He also indicated that more details around the dual-core server chip will be disclosed this week, but that Intel does not plan to talk about the dual-core desktop chip at this show.

As promised, Intel demonstrated a dual-core processor. An Itanium 2 server from Silicon Graphics Inc was shown running a weather modeling application on Montecito, Intel's previously disclosed dual-core Itanium 2 processor. Montecito is due to arrive in 2005.

The move to dual-core processors will proceed much faster for notebook and server processors. Otellini said. More than 75 per cent of Intel's 2006 shipments in those categories will be dual-core chips, with just under half of all desktop chips in that time frame containing two cores, he said.

Intel also needs to take a leadership role in addressing what will happen to the per-processor software licensing model that is the standard for most application vendors, said Gordon Haff, an analyst with Illuminata Inc. in Nashua, New Hampshire. It's unclear what will happen to that model as chipmakers introduce products with multiple cores and virtualization technologies, he said.

Otellini's speech was notable for its lack of any details about that topic, but Intel will have to address the issue at some point, Haff said.

In the meantime, Intel will continue to bring new features to its chips. It has already introduced hyperthreading and 64-bit extensions, and plans to bring virtualization and security features to its chips in the future. Otellini demonstrated a digital office PC that could run different applications and operating systems on a single chip with Vanderpool, Intel's virtualization technology.

Vanderpool and LaGrande, Intel's code-name for a digital-rights management technology, will not ship in Intel products until Microsoft Corp. releases Longhorn, Otellini said. Longhorn is the next generation of the Windows operating system, and as of Tuesday it was expected in 2006.

Otellini also discussed the WiMax broadband wireless technology, a development that Intel believes could help bring broadband Internet to areas that are not served by fixed broadband lines. WiMax could have the same effect on broadband deployment that cellular phones have had on the deployment of fixed-line phones, Otellini said.

The company announced that samples of its first WiMax chip are shipping to networking companies. Over the next year, Intel's Rosedale chip will appear in WiMax products that can deliver broadband wireless signals over a 30-mile (48 kilometers) range.

Otellini did not address any of Intel's recent difficulties during his speech, but Intel Chief Technology Officer Pat Gelsinger acknowledged that these are "tough times" for Intel. The company has had several product delays and manufacturing glitches this year, and announced last week that it would not meet its own targets for third-quarter revenue.

In a question-and-answer session following the speech, Otellini said Intel's planning has not been sharp this year. The company will plan more of its future products around platforms, such as the digital home, rather than specific products, Otellini said.

"We're putting in consistently rigorous conservative scheduling. We want to be more predictable," Otellini said.

Intel sees nothing right now to rethink its expectations for the fourth quarter, Otellini said. The third-quarter revenue shortfall came after Intel realized too late "that our view of the world was overheated," but the fourth quarter is traditionally Intel's best quarter, he said.

The Fall Intel Developer Forum runs through Thursday.