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The performance of some Spatial Analyst functions is slower in ArcGIS 8.1 than before the Beta 2 release. The performance can be 5-8 times slower with grid inputs.
After the Beta 2 release, a new feature was added to Spatial Analyst to allow performing spatial analysis on input datasets that have different spatial references, and to allow users to specify the spatial reference for the output. The implementation of this projection handling resulted in an increase in processing time, which slowed down the performance of the Spatial Analyst.
This has been addressed in ArcGIS Version 8.1.2.