Analysts Say Intel Price Cuts Boost Pentium II, Part II
ABN AMRO Chicago Corp. analyst David Wu said Intel is expected to
introduce new versions of the Pentium II next year aimed at lower-priced
computers, which will strike a blow at AMD and Cyrix, whose chips generally
undercut Intel's prices.
In the latest price cuts Oct. 27, Intel cut the price of its 233-MHz Pentium II
by 24 percent to $401 from $530, and slashed other models by more while
leaving unchanged the price of Pentium Pro chips for more powerful servers
-- the computers that run computer networks -- and workstations.
Last week, the trade publication Computer Retail Week reported in its online
edition that Intel was preparing to cut the price of large-quantity orders for
its 233-MHz Pentium II chip by roughly one-third on Jan. 1 to only about $75
a chip more than its lower-end 233-MHz Pentium MMX chip.
Cited unnamed sources, it reported that in February Intel will cut prices of its
266-MHz Pentium II to $370 from $520 currently and its 300-MHz Pentium
II to $520 from $721 and will add new 333-MHz Pentium IIs.
The 333-MHz Pentium II will be priced at $705 each. Two faster versions --
the 350-MHz at $840 and the 400-MHz at $980 - - are due to ship in April,
according to the report.
Intel declined to comment on the report, noting that it typically informs
customers of planned pricing changes several months in advance so the PC
makers can set product and price strategy.
Intel has tended to reduce prices on at least some of its products every
quarter, roughly following the pattern of Moore's Law. The "law" is named for
Intel co-founder and Chairman Emeritus Gordon Moore, who predicted chips
would double in performance for a given cost every 18 months.
Instituting two separate price cuts in a quarter would be unusual but not
unprecedented for Intel.
Computer Retail Week reported that Compaq Computer will use AMD's K6
chips in up to four Presario notebooks and at least two consumer desktop
PCs.
Such a move by the world's largest PC maker, which already has been using
Cyrix chips and has used AMD processors in the past, could put further
pressure on Intel.
A spokesman for AMD, based in Sunnyvale, Calif., declined to comment,
saying it lets customers make such announcements.
A spokeswoman for Houston-based Compaq said the company does not
comment on future products. "We are partners with Intel and we've got
flexibility with other partners," she said. |
