AMD has unveiled its new line of CPU and GPU products, with a heavy emphasis on low power chips for netbooks, ultraportable laptops, and low power desktops. Probably the most interesting new chips in AMD’s lineup are the new Fusion chips which combine graphics and CPU functions onto a single chip. We’ve been hearing about these products for ages, but they’re finally available starting this month. In fact, HP has already introduced one of the first notebooks to use an AMD Fusion chip, the HP Pavilion dm1z.

Two of the first Fusion chips are the AMD Ontario (C-Sereis) and Zacate (E-Series) chips. The Ontario chip has a total power draw of 9W, but manages to bundle low power “Bobcat” CPU core with AMD Radeon HD 6000M series graphics capable of handling 1080p HD video Playback, DirectX 11, and 3D graphics acceleration. Ontario chips will likely be found primarily in 10 inch netbook sized laptops and other low power computers priced at $400 or less.

The Zacate chip has a higher TDP of 18W, but features a higher performance dual core chipset while still providing long battery life. AMD says a computer should be able to get more than 10 hours of run time with a Zacate chip… although that’s basically what you get while the computer is idling with the WiFi turned off. Expect somewhat more modest battery life under real world conditions, but don’t expect the same 2-4 hours of run time we saw from AMD chips just a few years ago.

AMD is also launching a new line of discrete graphics cards based on the HD 6000 series. The bottom of the line version is the HD 6300M, which will still support HD video, DX11 and more, but it won’t have all the bells and whistles available in higher end versions such as support for DisplayPort 1.2 technology or 3D Blu-Ray.

The new graphics cards will also work in conjunction with software designed to take care of hardware graphics acceleration. That includes Windows Media Player, Adobe Flash, and other video apps, but also apps such as Microsoft Office, Internet Explorer, and Mozilla Firefox. By offloading some of the work to the GPU instead of the CPU, you’ll be able to perform some tasks more quickly while using less CPU power, which will help with multitasking performance. There’s also support for hardware acceleration in transcoding video.

One of the coolest things AMD showed me during a recent demo was how the new AMD Catalyst software supports real-time video enhancements. Say you’re watching a YouTube video that’s a bit fuzzy and features shaky camera work. If you’ve got a new AMD graphics card and the latest Catalyst software installed, not only will the video look sharper, but the software will actually do its best to reduce the shaky camera angles in real-time, showing you a more professional looking video.

While AMD”s Fusion chips have integrated graphics processing capabilities that are on-par with a discrete graphics chip, meaning there’s no need (or ability) to switch between graphics cards, AMD is also highlighting the fast graphics switching capabilities for its discrete cards. Say you have an Intel or AMD CPU with integrated graphics and a higher performance AMD Radeon HD 6000 series graphics card, and you don’t need the discrete card all the time. You can just turn it off without rebooting the computer.

I asked AMD whether there were plans to make the process automatic, the way that NVIDIA has done with its Optimus technology which detects which apps you’re using and turns the high performance graphics card on or off as needed. While that’s not currently possible with AMD”s latest chips, the company says it is on the roadmap.

While AMD was a bit late to enter the netbook and low cost ultraportable space, the company clearly hasn’t decided to cede the market to Intel. Instead, the company is doing exactly what Intel hasn’t done yet: producing low power chips that offer the kind of performance we’ve come to expect from a laptop, but for small computers priced in the $200 to $500 range.

While Intel has a vested interest in differentiating its low power Atom chips from pricier, higher performance chips which are much more profitable for the company, AMD has a market share of just about 12% to 14% in the laptop space, and is looking for ways to expand its share. I think the company’s Ontario and Zacate chips could certainly help do that, by offering consumers a chance to buy 10-12 inch mini-laptops that look pretty much the same as a typical Intel Atom powered machine, but which offer far better performance for about the same price.

Like Intel Atom-based systems, AMD expects most 10 inch mini-laptops that ship with Ontario chips to come with Windows 7 Starter preloaded, while most Zacate-based systems will likely run Windows 7 Home Premium and up.

AMD says the chips may also end up in some tablets if OEMs decide to use them for that purpose, but the company isn’t currently focusing on that space.

For reference, the first Ontario chips available will be the AMD C-30 1.2GHz single core chip with total power draw of 9 watts and the C-50 1GHz dual core chip with the same TDP.

The first Zacate chips will be the 1.5GHz E-240 single core APU with an 18W TDP and the 1.6GHz E-350 dual core processor.

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