Paul,
Something may be going on. Check out this newswire:
November 13, 1997
Analyst Says Intel Is Offering
Further Pentium II Price Cuts
By CHRISTOPHER GRIMES
Dow Jones Newswires
A well-known chip-industry analyst said Thursday that Intel Corp. is
instituting further prices cuts on its Pentium II chips in order to speed up the market's acceptance of them.
Drew Peck, an analyst at Cowen & Co., said Intel is offering discounts to selected customers that go beyond the price cuts that took effect Nov. 1.
As an example, Mr. Peck said Intel is selling the 233-megahertz Pentium II chip for $250 to $300 to some of its customers. Those chips were reported to cost $401 at the beginning of November.
Intel didn't immediately return phone calls for comment.
As part of its regular regimen of cutting prices
three times a year, Intel cut chip prices by 13%
to 40% on Nov. 1, with most of the cuts at
about 20%. In August, the company reduced
prices by 30% to 50%.
In a note Thursday, Lehman Brothers Inc. analyst Michael Gumport wrote
that he had heard from clients that Intel was planning to cut prices in December. He wrote that if this is true, it would be "a very unusual move."
Mr. Gumport wasn't available for comment.
Mr. Peck said he had heard the cuts would begin in January. But he said if Intel is offering reduced prices to some companies, it may not choose to formally announce price cuts later on.
"The issue of a formal price cut becomes academic," he said.
He said aggressive price cuts are a good strategy for Intel in the long-term, although there could be short-term problems with gross margins.
"It makes good sense to be doing that," Mr. Peck said. "Intel's highest priority is to move users to the Pentium II as quickly as possible, and if they can't do that based on technical merit alone, then they'll do it through pricing."
Intel spokesman Tom Waldrop said the company doesn't comment on
future pricing moves. But he did say the company tends to have some price moves each quarter. Those moves, he said, are revealed only to Intel's customers.
-------------------------
Just throwing out this news item. I have no knowledge of its authenticity.
Larry |
