The HP Pavilion dv2 is the first laptop to use AMD's Athlon Neo processor, delivering reasonable power, in a tiny notebook frame, for a moderate price.

Some think that the netbook category will gradually disappear as the division between mini and regular laptop starts to blur. There's already a creep upward in price and specs of many netbook models, with Windows essentially ubiquitous, and a general drift away from the original ethos of small, cheap, and fast booting.

The common ingredient to most netbooks has been the Intel Atom processor, but now AMD has answered the challenge with a lower power processor, codenamed Yukon. Lower power it may be, at around 15W TDP, but this chip is still appreciably hungrier and hotter than a 4W Intel Atom.

The HP Pavilion dv2 is the first laptop to use AMD's new Athlon Neo MV-40 processor. But where Intel has pared the Atom down to the near minimum, sacrificing raw performance in order to hit lower power consumption targets, the Neo promises a little more oomph.

In size, price and performance, the HP Pavilion dv2 is certainly sitting between netbook and notebook. Its clock speed is 1.6GHz - the same as an Atom - although it will quickly underclock to 800MHz when idle.

You can find the HP Pavilion dv2 with an ATI Radeon X1250 integrated graphics processor; or as we tested, with a discrete HD 3410 graphics card. Other options are a choice of either dual-layer DVD writer or Blu-ray reader optical drives, available as external USB units supplied in the box.

By giving the HP Pavilion dv2 a 12in screen, HP has reinforced that 'tweener positioning, being larger than the netbook 10in standard, and smaller than the 13in-15in size of most other laptops. In weight too, it's well below the 2.5kg+ of a regular notebook, at just over 1.6kg when packing its standard four-cell battery.

In processor performance, we were glad to see that the HP Pavilion dv2 is conspicuously more powerful CPU than the Intel Atom. They may carry the same headline figure of 1.6GHz, but in our tests the AMD Neo 64 was around 40% faster.

Where most netbooks with Atom processors will hit around 35 points in the WorldBench 6 real-world test, this AMD-equipped HP Pavilion dv2 notched up 48 points. And that's running the corpulent Windows Vista Home Premium. Give the dv2 a less onerous OS, such as the XP found on most netbooks, and we'd probably see the truth of a bigger gap between Atom and Neo.

The HP Pavilion dv2 is a neatly designed notebook, especially if you like high-gloss finishes. From the shiny reflective screen to the lacquered bodywork to the gleaming metallic touchpad, the HP Pavilion dv2 is a highly polished affair, rounded off with chrome-effect plastic side trim.

The HP Pavilion dv2 includes HDMI and VGA video outputs, three USB ports and a multi-card reader on its sides, and 802.11n wireless and 320GB hard disk inside. Graphics performance is better than that from any low-cost netbook - we noted 10 frame per second in our FEAR game test, a figure that can be raised to playability levels by dropping detail settings.

As we've found with other recent HP laptops, the keyboard of the HP Pavilion dv2 is a something of a saving grace, possessing excellent action, crowned with beautifully sculpted key tops. Trackpad and mouse buttons are also commendably well specified and easy to use.

Unfortunately, battery life of the HP Pavilion dv2 was well short of our expectations for a modern compact notebook. So much so, we held back publishing our review after AMD promised that the impending next version, the HP Pavilion dv2z, had ironed out such issues. But that model, we now learn, is still some time away for these shores.

We measured 129 minutes lifespan using the MobileMark 2007 Productivity test. At little over two hours, that's a disappointing performance for a brand new portable. We were told that using Windows 7 would help - but if true, that would nudge up scores of all laptops and hardly improve the dv2's cause. A new BIOS update also helps, we were told. So we updated to the latest F.09 version, and then recorded an uptime of 132 minutes - close enough to suggest no real benefit.

The HP Pavilion dv2 with integrated, rather than discrete, graphics may stretch this running time more. Especially if it means that it now runs cool enough that the fan does not need to be running all the time, as it does with the all-too ephemeral dv2-1030 model.