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

To: Mo Chips who wrote (54291)	4/23/1998 2:36:00 PM
From: Home-Run	Read Replies (1) \| Respond to of 186894

OK. I am going to take sell Intel now. Hopefully I will get a chance to buy it at a lower price. Well, maybe I am making a big mistake.

To: Mo Chips who wrote (54291)	4/23/1998 3:01:00 PM
From: Larry Loeb	Read Replies (2) \| Respond to of 186894

There are other forces causing ASPs to fall. Perhaps a little ol' thing called demand. You remember, from Econ 101... Well, you're kind of right. It's not a fall off in demand, as you suggest, but the creation of a new niche in the market. And the resulting competition in that niche. Cyrix and Compaq created the first credible PC designed for the under $1,000 market. While many of us wouldn't want to purchase such a machine because of our expectations of early obsolescence (an expectation that was apparently originally shared by Intel), consumers found that price range to be compelling. There has been a lot of debate as to the degree that this segment has cannibalized sales of higher priced PCs (versus expanding the overall market). But there is now little doubt that there is demand for product in this market segment. This consumer demand led the other leading PC manufacturers (except Dell) to pursue the lower priced market. These manufacturers have pressured Intel, by using threats of purchasing AMD and Cyrix chips, to offer a product designed for the low priced market. This pressure led to Celeron (and soon to Mendocino). Celeron, as Intel noted in their analyst conference on Tuesday, is designed for the home PC market. It executes general purpose software (spreadsheets, word processors, etc.) with adequate speeds, while offering superior game and graphics capability. Anyway, the decline in ASPs is due to Intel's customers pressuring Intel to compete with products of AMD and Cyrix which apparently, due to their lack of financial performance, are priced below cost. Larry

To: Mo Chips who wrote (54291)	4/23/1998 7:00:00 PM
From: BelowTheCrowd	Read Replies (1) \| Respond to of 186894

As I said elsewhere, ASPs are dropping because there is a whole new groups of users who are willing to buy "last years technology", which is always a lot cheaper than this year's and always has been. Price cuts have always been a fact of life in this business. What has changed is that in the past nobody wanted to buy an 18 month old processor design because it probably wouldn't support the current software offerings. These days lots of people with minimal needs are finding out that the basic software of 2 years ago, running on the basic hardware of 2 years ago, is perfectly fine for them. This will continue until the industry gives even basic consumers a reason to move to the next level. My guess is that the next big move CAN'T happen until the various telecom infrastructure people do some thing to provide more bandwidth to the home. That's why people like Paul Allen want to get into cable TV. It's not so much because it's a great industry NOW, but rather because they'd like to shake out the dinosaurs and move our telco infrastructure out of the 19th century... mg