The $1000 PC phenomenon is not happening at the expense of Intel, IMHO. To the contrary, I believe. While the price of CPU chips seems to have fallen a lot lately, it is only a fraction of what has been happening in the world of RAM and hard disks. I am amazed to see 32 MB EDO SIMMs for under $50, and 2 GB hard disks for under $200. Decent Pentium-class motherboards are under $90 now, with lots of stuff already integrated on them, and everything else that goes into a PC is similarly dirt cheap EXCEPT, relatively speaking, the CPU.
All in all, it seems to me that the only one who can be profiting from the sale of $1000 PCs is Intel. I've been around PCs for a long time now. I remember the original IBM PC, XT and AT. Intel used to have only a tiny portion of the value of those machines. When the XT sold for $3500, the CPU represented less than 3% of that. When the first ATs were going for $5000, the CPU was less than 5%. Here we are now, with $1000 200MMX systems, and the CPU represents 20%. |
