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To: Paul Engel who wrote (1978)	11/6/1997 12:07:00 AM
From: Maxwell	Read Replies (3) \| Respond to of 6843

Paul Engel: I looked at Intel price reduction and AMD new pricing of the K6. Looks like AMD still make good money with K6-233 and K6-200. K6-166 is negative profit. Intel new pricing is still too conservative. AMD will live and the cancer will grow larger next quarter when AMD announces a profit. If I was Intel I would sell the P55-233 for $100, P55-200 for $90, P55-166 for $80. This will drive AMD and Cyrix out of business fast. Then Intel can raise their price again once the competitors are out of business. What do you think of this stategy? Maxwell

To: Paul Engel who wrote (1978)	11/6/1997 10:44:00 AM
From: bananawind	Respond to of 6843

Paul... re: "...To that end, they have agressively lowered their prices and have suffered a 3% to 10% drop in earnings..." Thanks Paul. Then I guess another way to look at it is that they have "invested", say $1 billion, of foregone profit in order to force a competitor into a strategic box where the only possible response (matching price cuts) hurts the competitor and may actually work to INTC's long term benefit (by expanding the overall marketplace beyond what it would have been). What I'm still trying to figure out is how a competitor gets the drop on INTC and how likely it is to happen again. I suppose, however, anyone can decide to make no profit for a while, aim all their R&D a few generations out, and just roll the dice. Thanks again. -JLF