As you probably know, Intel launches its Itanium 2 processors using Madison core later this year, sometime in May, June or July. In addition, Intel will also roll more affordable Itanium 2 chip based on Deerfield core in the third quarter this year. Both CPUs will be made using 0.13 micron fabrication technology and fit into existing Itanium 2 system design.

The difference between two processors is that Itanium 2 “Madison” chips are developed for MP high-end servers and offer high clock-speeds as well as large L3 caches, while Itanium 2 “Deerfield” is intended for DP servers and workstations, consumes not a lot of power, its core-frequency is substantially lower than that of Madison CPUs and its L3 cache is not as large.

The new Itanium 2 “Madison” microprocessors will offer significant performance increase over the current generation of IA64 CPUs for high-end servers, but according to the information told by our source today, the new processors will not be more expensive than their predecessors. Itanium 2 1.50GHz with 6MB L3 cache CPU will debut at $4226, the Itanium 2 1.40GHz with 4M of L3 will cost $2247 and the Itanium 2 1.30GHz with 3MB of L3 will be sold for $1338 in quantities starting from 1000 units.

Note that Intel Xeon 1.50GHz with 1MB of L3 costs $1177 at the moment, only slightly cheaper than the younger Itanium 2 “Madison”. It is interesting to note that the LV Intel Itanium 2 “Deerfield” chip at 1.0GHz with 1.5MB of L3 cache for DP systems debuts at $851 what is comparable to the price of higher-end Xeon DP CPUs. With such pricing on the IA64 processors, soon we may see some of them being cheaper than IA32 products. Obviously, the whole IA64 systems will not become affordable for a number of years from now since we need new software developed specially for IA64 processors, but the trend towards cheaper 64-bit chips is definitely a positive one.