IBM has officially announced mass production of its new award-winning microprocessor the PowerPC 970FX (called G5 by Apple), a move that suggests Apple may release a speed-bumped new generation of G5 Power Macs.

It's already known that the processor powers Apple's new G5 Xserves. IBM has confirmed it is producing the 970FX using a new 90nm manufacturing method which creates chips that consume less power.

The news means the processors can either run at faster speeds or use less power. Richard Doherty, research director at Envisioneering told Reuters: "It's logical that Apple would select the flexibility of this chip for a next-generation notebook computer."

The new processor is being manufactured at IBM's advanced $2.5 billion New York fab plant in Fishkill. "With this fusion of IBM-pioneered technologies, customers no longer have to sacrifice performance to achieve the power savings they increasingly demand," said Bernard Meyerson, IBM fellow and chief technologist at IBM Systems and Technology Group.

IBM is expected to announce a 2.5GHz version of the chip at the International Solid State Circuits Conference (ISSCC) in San Francisco next week. PowerPCs on the market today, produced on a 130nm process, top out at 2GHz.

Editor-in-chief of the Microprocessor Review Peter Gaskowsky told Macworld UK: "IBM currently makes what we believe is the best PC desktop processor on the market, the PowerPC 970FX, and we expect to see this chip appear in laptops as well.

"Apple had a role in the development of the PowerPC 970 family, and has benefited greatly from the ability to use these chips. It is at the forefront of the industry because of a combination of factors, not just because of the PowerPC 970 family, but those chips are a critical ingredient in the recipe for Apple's systems," he said.

In-Stat/MDR's February edition of the Micropocessor Report states: "Despite being smaller than the market-leading Pentium 4, the 970’s performance is fully competitive. In tests conducted for Apple by Veritest, using the open-source Gnu C Compiler (GCC), the 2GHz 970 outperformed the 3.2GHz Pentium 4 on the SPEC floating-point suite and was only slightly behind in SPECint testing."

The highly respected industry title also responds to numerous reports that dispute the results of those tests: "Testing conducted by various PC and Macintosh magazines show the Pentium 4 and AMD’s Athlon 64 to be significantly faster on real-world applications, but we believe this performance is due to the availability of Intel’s highly efficient vectorizing x86 compiler. IBM recently released its own vectorizing C and Fortran compilers for the PowerPC 970; these work with Apple’s own development tools, and we expect them to be widely used for Mac software development.

"As IBM’s compiler technology is adopted by Macintosh software developers, Mac applications will get a significant performance boost," it said.