MAKATI City -- Intel is taking a "fundamental shift" in designing microprocessors by following specific usage models instead of coming out with just faster and smaller chips, executives said in a teleconference.

"Intel is coming out with new models based on the usage models. This is not ‘waterfall’ technology. This innovation was built from the ground-up," said Uday Marty, marketing director, basic mobile platforms of the mobility platforms group of Intel.

Intel has announced that it will introduce in mid-2008 a new affordable notebook that will fall under the sub-$400 category. Marty reiterated that the Netbook will be launched mid-2008, and will become available to the market in the third quarter of 2008.

The Netbook, which will run on the new Intel Atom, will cost around $250 to $350. But apart from the emergence of the Netbook, an affordable and Internet-centric notebook, Marty said Intel's new Atom chip will end up in desktop computers, now dubbed "Nettops."

A Nettop is a desktop version of the Netbook, a desktop computer with a smaller form factor.

"There will be a market for that but it will be a smaller market than the netbook. The price point will also be lower," Marty said.

The increasing popularity of brands like the Asus Eee, a basic Internet-enabled notebook that runs on an Intel chip, has made Intel realize that there is a market for budget Internet mobile sub-notebooks in emerging and mature markets as well.

The Netbook notebook segment category is a result of designing smaller and yet low-cost chips, now called Intel Atom, added Marty.

Intel Atom was formerly known as "Diamondville." Diamondville is a derivative of the Silverthorne chip of Intel, which also features the 45 nanometer manufacturing process and high-K metal gate CMOS (complimentary metal oxide semiconductor) technology.