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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Jim McMannis who wrote (29564)	3/5/1998 1:41:00 PM
From: Maverick	Respond to of 1572551

Asia & lower ASP weren't culprit, part III PC prices have been dropping steadily for the past two years, but those cuts have been driven mostly by lower prices for computer components such as disk drives, microprocessors and memory. There is some evidence that more recent price cuts, however, are a response to lower sales volume -- and may cut into computer manufacturers' profit margins. ''There's more inventory than what would have been liked at the end of December,'' said Alan Loewenstein, assistant portfolio manager at John Hancock Technology Fund. ''When you add it all up, the numbers are not as robust as expected.'' Intel's announcement is the most significant indicator of a slowdown to date. ''In some ways, Intel is the computer industry,'' noted industry analyst Dan Hutcheson, founder of VLSI Research Inc. in San Jose. ''Everything revolves around their microprocessor. If their sales go down, it's certainly possible that the industry as a whole is slowing down.'' Lesser possibilities There are less worrisome possibilities, Hutcheson said. Intel's sales decline could reflect that the company has been slow to react to changing market conditions, particularly the emergence of the sub-$1,000 PC. Months after those PCs became popular, Intel on Wednesday unveiled a new brand name for its first Pentium II processor designed especially for low-end computers. The Celeron line of microprocessors will be available in April. ''Consumers and businesses could simply not see the need to buy more powerful and expensive systems to do the same things they have always done,'' Hutcheson said. Consumers could also be waiting until Microsoft Corp. introduces Windows 98 -- the next version of its popular operating system -- before they decide what new computer they need to buy, he said.