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New computer chip could cause software price problems

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Hardware

A promising new kind of computer chip can have an unexpected side effect: forcing companies to pay more for software.

Chipmakers Intel and Advanced Micro Devices each launched computer processors last week that have two "brains" — called "cores" in industry lingo — on one chip.

The chips run faster than similar traditional processors, which only have one brain. But they're not twice as fast. And that's a problem for business software buyers.

Software makers such as Oracle and IBM frequently price software on a per-core basis because, until now, one core was roughly equal to one computer's worth of power.

For example, a business running a piece of software on five cores is assumed to use the software more than a company running it on one core. Thus, the five-core business would pay more.

The new chips by Intel and AMD don't fit this equation. That may cause some companies — especially small and midsize firms not big enough to get special deals — to pay almost twice as much for some software, tech analysts say. Or it may cause slow adoption of promising multicore chips, they say.

"It's a very real concern," says software analyst Amy Konary with researcher IDC.

Software makers are dealing with the problem differently:

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