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

To: Pigboy who wrote (53596)	4/16/1998 7:51:00 AM
From: Glenn D. Rudolph	Respond to of 186894

Growth of PC microprocessor market to slow - study Reuters Story - April 15, 1998 23:09 %DPR %BUS %ELI %US %FCAST INTC AMD NSM V%REUTER P%RTR SAN JOSE, Calif., April 15 (Reuters) - Worldwide sales of x86 microprocessors, the most widely used primary chips in personal computers, will rise only 16 percent in 1998, reflecting collapsing prices, market researcher Dataquest said on Wednesday. Worldwide sales will rise to $22.72 billion in 1998 from $19.58 billion in 1997. In comparison, x86 microprocessor sales rose 24 percent in 1997 from 1996, said Nathan Brookwood, the Dataquest analyst who compiled the forecast. "That is a big drop, primarily because of lower average selling prices of microprocessors," Brookwood said. The price of an average PC has collapsed from about $2,000 to about $1,000, putting tremendous pressure on chipmakers to cut their prices, he said. x86 microprocessors are computer chips that perform the fundamental calculations of about 90 percent of the world's computers. Intel Corp. is the inventor of the standard and is by far the biggest producer, though it faces increasing competition from rivals like Advanced Micro Devices Inc. and National Semiconductor Corp. , which sell x86 chips for much cheaper. Brookwood said the biggest drag on growth was collapsing prices of chips destined for desktop PCs. The average price of these chips is expected to fall to just $154 in 1998, down from $175 last year, according to Dataquest. Chips for desktops account for about 60 percent of the total market. What's more, Intel will lose market share in 1998 because its chips are more expensive than its rivals. Its share likely will fall to about 92 percent in 1998, down from 93.8 percent in 1997 and 95 percent in 1996, Brookwood said. On Wednesday, the same day the report appeared, Intel unveiled the Celeron chip, a relatively cheap microprocessor designed to key PC makers from flocking to AMD and National Semiconductor. Brookwood said most of the worldwide microprocessor revenue growth in 1998 would come from sales of chips for high-end desktop machines, known as workstations, or for servers, the special computers that handle the flow of information through computer networks.