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To: Jules V who wrote (43626)	1/2/1998 6:21:00 PM
From: paul flint	Read Replies (3) \| Respond to of 186894

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%.

To: Jules V who wrote (43626)	1/2/1998 11:09:00 PM
From: Joe NYC	Read Replies (2) \| Respond to of 186894

Jules, Here is another anecdotal piece of evidence. I saw a purchase order for my work PC 2 years ago. It was an "average" than, somewhat behind the top of the line. It was Compaq Pentium 100 with a 17" monitor. The total price was over $4,000. Today, I could buy a Compaq Computer, similarly behind the state of the are (Pentium-233 or P-II 233) for less than $1,500. Of 1998 dollars, that according to goverment accountats are worth about $.95 or even less than 1996 dollars. I would not buy lower than about a P200 personally, and if it was only $200-300 more I would get a PII. Is it? With MediaGX 220MHz at $799 and P-MMX/K6 233 MHz at $999, there is little incentive to go to 200 MHz or below. intel has low end servers locked up, and will move up the food chain Darwinian style soon. Intel has a chance to make major inroads in the high end server market with Merced, but I think it will not generate significant revenue until year 2000. It may be earlier if it can run x86 software significantly faster than natice x86 processors and is cost competitive. If Merced has to make it solely on it's ability to run it's native instruction set, we will have to wait until the software is refined, and varous evaluations run their course. Regarding your prediction about sub $1000 notebooks this year: that would be nice, I would buy if its a p166. We should see some competition in the notebook market this year, which will bring the prices closer to desktop level. Prices of other components are going down as well: Message 3080655 Joe