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VG, I guess the question you are asking is... "why would a company cut their prices, even though they have experienced internal cost reductions?" Don't pass the cost reductions (savings) along to the customers, just pocket the extra profits. This will improve the quarterly earnings and help boost the stock's price. Hey, I'm all for this approach.
However, things just don't work this way in the electronics industry, nor many other industries. There is something called a "learning curve". Simply stated, the learning curve results in process improvements and lower costs for a product. The more you manufacture, and the longer you manufacture a product, the cheaper it is to make the product. Thus, company's, such as Intel and Dell, can lower the pricing of the product. This normally results in increased market share and higher revenues. That's why components and computers keep getting cheaper.
In the meantime, the manufactures are developing new products. These new products can be sold for premium prices. The cycle just keeps repeating itself.
So, its ok to lower prices, if the company's internal costs are lowered to offset the price reductions.
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