Sept. 17 (Bloomberg) -- Intel Corp. Chief Executive Officer Paul Otellini may speed up work on faster computer chips in a bid to undercut Advanced Micro Devices Inc.'s biggest product debut in four years.

Advanced Micro promoted its new chip, Barcelona, with a party hosted by CEO Hector Ruiz a week ago at filmmaker George Lucas's Letterman Digital Arts Center. The invitations hailed the event as ``the most anticipated premiere of 2007.''

Intel, the world's biggest computer-chip maker, may use a conference beginning tomorrow in San Francisco to give more details of a new chip design called Nehalem to upstage the Barcelona, UBS AG analyst Uche Orji said. Some existing processors of Intel already outstrip Advanced Micro's new chip.

``They have their foot very solidly on AMD's throat,'' said Hans Mosesmann, a New York-based analyst for Raymond James & Associates Inc. who rates Intel shares ``buy'' and doesn't own them. ``They just keep on putting the pressure on.''

After losing orders in 2005 and sinking to its lowest market share in 11 years in 2006, Santa Clara, California-based Intel revamped its designs and started to win back sales. Intel will spend $10.6 billion on research and factory equipment this year to build faster processors, more than three times Advanced Micro's budget.

Otellini may move up the schedule for shrinking the size of the wires inside semiconductors by 25 percent, to 45 nanometers, said Orji, who is based in New York. About 400 of the new transistors would fit on the surface of a single human red blood cell.

`Much More Detail'

``Intel will provide much more detail regarding upcoming products and technologies'' at the three-day conference, said Tom Beermann, an Intel spokesman. He declined to comment on specific plans.

``The competitive dynamic shifted to AMD's favor,'' said John Fruehe, a marketing manager for Sunnyvale, California-based Advanced Micro, the second-largest maker of computer processors. The company is ramping up the performance of the Barcelona quickly and ``much hard work looms ahead'' for Intel, he said.

Advanced Micro's Barcelona processor runs at 2 gigahertz. Intel began selling 3 gigahertz chips Aug. 13.

Intel rebounded to claim 76 percent of the market last quarter, 2 points higher than at the end of 2006, and last week raised its third-quarter sales forecast. Otellini accelerated development of some chips by three months for buyers such as Dell Inc. after Intel trailed Advanced Micro in technology including putting two processors into one piece of silicon.

Intel stock, up 23 percent this year, fell 8 cents to $24.85 at 4 p.m. in Nasdaq Stock Market trading. Advanced Micro shares added 15 cents to $12.84 and are down 37 percent this year.

YouTube Response

Intel responded to the Barcelona debut with a spot on the YouTube video-sharing Web site, where Senior Vice President Pat Gelsinger said the company will demonstrate a working chip with the 45-nanometer wires at the show.

Presentations will focus on a ``tick/tock'' plan calling for Intel to introduce a design one year and a manufacturing upgrade the next, Gelsinger said. It took Advanced Micro four years to update its chip design, and the debut was about six months late.

Intel co-founder Gordon Moore will speak at the event for the first time since 1999. The creator of ``Moore's Law,'' the prediction that has set the pace for improvement in the computer industry for 40 years, will give a speech to commemorate the 60th anniversary of the invention of the transistor. Moore's Law says the power of chips should double every two years.

Intel last year replaced its Pentium design with one called Core, which is better at performing multiple tasks simultaneously, making it faster and more power-efficient.

``Intel is going to come out swinging,'' said JPMorgan Chase & Co. analyst Christopher Danely in San Francisco.

To contact the reporter on this story: Ian King in San Francisco at ianking@bloomberg.net

Last Updated: September 17, 2007 16:11 EDT