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Actually the very first iterations of Cell processor were designed to run at 4.6 GHz. The PS3 version has been down clocked for reliability, power consumption, size of the enclosure, cooling and other factors. It very much was designed to go faster, and smaller processes should allow transistors and therefore cycles to operate faster. Remember, Cell wasn't designed specifically for PS3. The colaboration was intended to produce a new kind of chip that combined the advantages of parallel massive floating point calculation throughput of a GPU with the logic flexibility of a CPU. Soon enough useful applications will make use of the type of power which only this kind of architecture can supply. It's just that Folding@Home is currently the only one.

PS. The Pentium 4 processor line was originally designed to scale up to 10 GHz before Intel screwed it up.