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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: nnillionaire who wrote (53158)	4/14/1998 10:16:00 PM
From: dougjn	Respond to of 186894

<<My concern here is that the low end products including Celeron will adversely affect that 'aura' in the minds of many.>> My (hopefully somewhat informed) guess is that while that may be somewhat the case, the damage won't we big enough to make much difference. Intel may loose a bit more of the low end market. Of course it can buy in as much of it as it wants. From whatever I've seen, Intel has the lowest costs in the industry, really at every performance level. Its just that their investors are used to really fat margins. So Intel may decide its not going too far to regain the low end. Although Celeron is clearly Intel's introduction of a chip which, like Cyrix, includes many support chips on the same chip and accordingly leads to very low system prices. Really, I don't think Celeron is all that important for Intel, one way or the other. What is I think important is that Intel may be forced to significantly cut selling prices and margins on its mainstream PII products in the next year or so. It is not that AMD or Cyrix are likely to be able to beat their best mainstream processors. Its that much of the market won't care enough about the performance difference to pay the traditional Intc upper middle edge price per chip. ($400-550). Nonetheless, Intel is likely to remain dominant. They have huge advantages. Dominance and momentum. Costs per chip. Capital. Marketing. And yes, engineering (especially in the much overlooked area of supporting chipsets, busses and archetectures.) Its just that their earnings and stock price may suffer for some time. In my judgement. Doug