Godson-2 currently clocks in at around 400Mhz to 500Mhz on a 0.18 micron process. Samples based on 0.13 micron technology should appear this year. That's a generation or two behind Intel and AMD, but Halfhill says the progress China is making is remarkable.

Nothing to get too excited about in terms of specs. Its no big news that China now has micro-processor production capability. The chip is a MIPS derivative, and there are some possible IP troubles there.. Imagine that, China and IP troubles..

Here is the real fun part:

"There would be two ironies here," he notes." One is the irony of China outsourcing manufacturing. The other irony is if it chooses TSMC as a fab, and outsources to Taiwan."

"Two ironies, one issue." Somewhere, Thomas Friedman just let out a chuckle..

Yes, you heard that correct. The Chinese national company BLX IC Design is outsourcing its manufacturing to Taiwan.