"I understand the argument, but he's pulling at straws," Gold said.

Castellano said in reply that while Intel's older factories producing 65nm, 90nm and 110nm chips may have been underused -- hence, the recent factory closures -- its 45-nm factories are still "running pretty much flat-out," he said. Intel would not comment on the assertion.

Castellano disagrees that the Penryns are much harder to manufacture than Atom CPUs. He points out that Atom chips, while having fewer transistors, are also roughly four times smaller.

Given that the cost of manufacturing is roughly equal -- "same factories, same materials, same tools, same engineers" -- the profit potential tilts heavily in the favor of Penryns.