The following article is part of The Motley Fool's "Stock Madness 2005," a contest based loosely on the annual NCAA College Basketball Tournament, a.k.a. March Madness. From March 17 to April 4, our writers and analysts will engage in head-to-head competition with each other, advocating and arguing on behalf of 64 stocks we've selected as among the most interesting to Foolish investors. You, dear readers, are the fans and referees -- you'll read these exciting duels and then vote for the stock you think is the better investment... and should therefore move on to the next round of play. The company that survives six "games" will be our tournament champion, and its writer our most valuable "coach."

But, please, make no mistake -- "Stock Madness 2005" is a GAME!

Our writers are doing this for fun. They are enjoying the spirit of competition and the art of debate. They are delighting in the search for positives in the companies they've drawn... and negatives in the companies they're pitted against. They are NOT necessarily recommending these stocks as the ones they believe in above all others. As ever, YOU must decide whether the stocks we're writing about -- winners and losers -- are deserving of your investment dollars.

Santa Clara , Calif.
52-week high-low: $19.64-$29.01
$151.13 billion market cap

By Alyce Lomax (TMF Lomax)

I have just one thing to say: "Intel Inside." (Readers: Please insert the audio tones that accompany that brilliant piece of marketing here, if you don't mind.) Need I say more?

Well, of course I do. Once, Intel was a darling of the technology world. So enamored were investors that the company's announcements could, at one time, move markets single-handedly. Lately, this giant has lost some of its silicon luster. But if there's anything that the long-term view on investing can show us, it's that stumbles can sometimes create a bargain for those who spot the comeback.

It could be nearing time for a more upbeat outlook on Intel. Recent word included an upward revision of the lower level of its previous guidance (although it still remained within the former spectrum). And in testament to the chipmaker's costs having gone down, Intel said its gross margins increased.

Meanwhile, Dell (NASDAQ:DELL), the PC giant and a Motley Fool Stock Advisor pick, may have been shopping around for new chips, but at least for the time being, it has decided to stay with Intel, which provides all the chips for its computing products. Many of you know that Dell has sported the "Intel Inside" logo for quite some time now.

Rival Advanced Micro Devices (NYSE:AMD) beat Intel to the punch recently with several chip introductions that made Intel seem behind the times. But among Intel's coming attractions include chips for the digital home -- namely, the living-room entertainment applications that are sure to be the next new thing. We can already see the signs that this area is going to be big, considering the popularity of technologies such as TiVo (NASDAQ:TIVO) and other digital video recorders.

Intel was down for a little while, but you can easily say that it's not out. And with its recent reversal in fortune illustrating some positive momentum and plenty of room for its products -- microprocessors being the building blocks of our new digital age of communication -- "Intel Inside" may be just the beginning.

Alyce Lomax does not own shares of any of the companies mentioned.

Cisco Systems (NASDAQ:CSCO)
San Jose , Calif.
52-week low-high $17.13-$24.83
$117.97 billion market cap

By Tim Beyers (TMFMileHigh)

Our tournament director has a wonderful sense of humor. I'm not at all surprised to find that days after I ate a heaping plate of crow for my earlier criticism of Intel that I'm paired against the chipmaker in round one. In fact, I appreciate the irony. I also find myself well-prepared to do battle on the hoops court of Foolish opinion.

After all, my team, Cisco Systems, is no slouch. Sure, it's experienced much of the same inventory problems as our rival has. And its business is also cyclical. But Cisco hasn't experienced design blunders and product delays, as Intel has.

The router maker is also well-cushioned against problems. Indeed, the balance sheet boasts more than $5 billion in cash on hand. And a rough calculation of owner earnings at Yahoo! Finance reveals that Cisco has thrown off more than $6 billion in free moolah over the trailing 12 months, easily topping net income over the same period.

Cisco also doesn't have a rival that's been eating its lunch on innovation. Yet that's exactly what Advanced Micro Devices (NYSE:AMD) has done to Intel.

Finally, ask yourself: Which market would you want to be the leader in? The 30-year-old PC industry, where the margins are, at best, 6%? Or the newer Internet infrastructure industry, where the products command generous double-digit margins for the important job of managing the digital traffic that's the lifeblood of today's business? Admit it, Fool: This one's a slam dunk.

Fool contributor Tim Beyers didn't own shares in any of the companies mentioned in this story at the time of publication. You can find out what is in his portfolio by checking Tim's Fool profile.

Tim is one of my favorite Fools, but I've just got to argue with his siding with Cisco over Intel. Routers are indeed instrumental in ferrying around digital traffic -- they're the lifeblood of today's business, as he says, and it's true. However, chips are the building blocks of all manner of digital equipment. And Intel is well aware of that. It's setting its sights far beyond PCs and into smartphones and devices that will make you wish you never had to leave your digital living room. Given the onslaught of increasing convergence in the home and the enterprise, if Intel keeps the chips flying, it's poised for a real return to greatness. -- A.L.

"Intel Inside"? That's it? OK, sure, Intel has a great brand name. But just what kind of message does "Intel Inside" send when manufacturing flaws appear? And it's not as if Intel is omnipresent. Advanced Micro Devices actually took PC chip market share from Intel during 2004. Conversely, confidence at Cisco appears to be riding high, with a key insider purchasing shares on the open market just last month. -- T.B.

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