Intel Corporation (INTC) Message Board

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Technology Stocks : Intel Corporation (INTC)

INTC 41.97

-4.1%

10:55 AM EST

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To: Elmer who wrote (123908)	12/31/2000 1:59:38 PM
From: Hightechhooper	Read Replies (1) of 186894

Elmer, I agree with everything you said but I really don't see the price situation the way you do. INTC has always fought AMD with good lowend pricing while keeping "sweet spot" and high end pricing high. The only times INTC has brought prices down in those segments (outside of normal manufacturing efficiencies) is when overall industry demand was poor (like now). AMD simply does not have the capacity to dictate prices for this market. Look at the pricing advantage INTC has maintained over AMD during the past year, which is clearly the most successful year AMD has ever had in terms of competitive performance versus INTC. For the same clock speed INTC system prices have remained at a significant premium to AMD and have not declined outside of "normal" price reductions. Because INTC will get back to their typical performance gap versus AMD in the next 6 months (thanks to the P4) they will not sacrifice margin across all their business to retain market share in the very short run. You simply have to look at their past pricing history to see that. INTC can use any excess capcity now to accelerate the rollout of P4. That is the point they want to get quickly because at that point they can reinstate the performance gap. They are not like a DRAM manufacturer that will price to fill capacity. When you monopolize total industry capacity for a product the way INTC does MPU's, a small player like AMD cannot control pricing. Can you point to any price moves that would indicate INTC pricing has suffered at the hands of AMD's cuts? I believe Paul has data that suggest AMD is fighting against itself and that is exactly what the macro-economic's of this monopolistic situation would suggest. I would be happy to alter my views if you can point to some data that supports your view. thanks and god help us all,

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