Good Morning Paul and ALL: Article...Intel prepares additional price cuts, 333MHz Pentium II...
By Lisa DiCarlo, PC Week Online
01.05.98 6:00 pm ET
Giving an already healthy PC market a healthy shove, Intel Corp. will kick-start 1998 with processor price cuts and a bump up in clock speed.
Late this month, the Santa Clara, Calif., company will cut prices of Pentium II and Pentium Processors with MMX Technology by as much as about 25 percent, according to sources familiar with Intel's plans. The company is also expected to release a 333MHz Pentium II on Jan. 26, the sources said.
Intel's moves come as rival Advanced Micro Devices Inc. is preparing to announce a deal with Compaq Computer Corp., which plans to use AMD's K6 processors in several consumer-based PC models, analysts said.
In addition, Cyrix Corp. this week will announce a faster MediaGX, the super-low-cost integrated processor also being used by Compaq.
The deepest price cuts in the Pentium II line will be on the 266MHz and 300MHz chips, which will be cut about 20 percent to about $300 and $440, respectively, sources said.
Last week, Intel made the unusual move of offering PC makers an interim 33 percent price cut on the 233MHz Pentium II, which is now priced at $268. Typically, Intel cuts chip prices across the board once per quarter.
Pentium Processors with MMX Technology, and systems built around them, are headed for the bargain bin. Prices for the processors will be cut about 25 percent, sources said. For example, the price of a 166MHz processor will be priced at well less than $100. The 200MHz Pentium with MMX Technology, which is priced at about $115 today, will fall to less than $100, sources said, while the 233MHz, which is now at about $180, will drop as much as 30 percent.
"Pentiums are definitely being phased out in favor of Pentium II,'' said Ashok Kumar, an analyst at Loewenbaum and Co., in Austin, Texas.
PC market leaders Compaq, Dell Computer Corp., Hewlett-Packard Co., IBM Personal Computer Co. and others are already selling Pentium with MMX Technology-based desktop PCs at or less than $1,500. The latest round of price cuts will enable corporate buyers to purchase Pentium II-based systems at that price.
Pentium Pro prices will not come down, which suggests those processors are being phased out as Intel readies the Pentium II. Although the Pentium Pro never reached volume status as a mainstream desktop chip, its use in servers -- particularly the pricey new Pentium Pro with 1MB of Level 2 cache -- generally has been well-accepted.
On the product front, the new 333MHz Pentium II, like current Pentium II processors, uses a 66MHz bus, sources said. However, Intel will follow up in April with 350MHz and 400MHz Pentium II chips that use a 100MHz front-side bus.
The 100MHz bus, enabling chip sets and processors, will plug into a next-generation slot called Slot 2 for high-end workstations and servers.
Intel's moves come as the PC market in general continues on the upswing, growing about 22 percent domestically in 1997, according to International Data Corp., in Framingham, Mass.
Several analysts peg low-cost or sub-$1,000 PCs as the fastest-growing segment of that market. For example, PC sales into homes grew by more than 1 million units in 1997, with overall penetration reaching 45 percent, according to IDC.
Intel officials were not available for comment.
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Paul, it never ceases to amaze me how very intelligent people like yourself seem to threaten so many other's.
Just goes to show how insecure their ego's and character really are.
Michael
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