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

To: Paul Engel who wrote (58002)	6/15/1998 2:13:00 PM
From: Francis Chow	Read Replies (1) \| Respond to of 186894

FTC extends Intel probe to chipsets: techweb.com Applied materials gets downgraded: techweb.com Win 98 not enough in Japan: news.com Markets tumble on Asian downturn: news.com

To: Paul Engel who wrote (58002)	6/15/1998 2:57:00 PM
From: gnuman	Read Replies (2) \| Respond to of 186894

Paul E. Found your post on the Cyrix thread and have some questions. To: Robert Grutza (27431 ) From: Paul Engel Monday, Jun 15 1998 1:04PM ET Reply # of 27457 Bob - Re: "What probability would you assign to Intel conceding this market? " (referring to sub-0's) ZERO per cent. In 1985, Intel was losing money BIG TIME on DRAM memory. They had been technologically uncompetitive for many years (see note below) and Japan, Inc. was highly focused, highly financed and was eating Intel's - and every American Semi Company's - lunch. Today, things are way different in the "low end" of CPUs: 1. Intel still has the majority of the sub $1000 PC processor business. Can I assume these have been Pentiums till now? 2. Fact 1 is ignored by the media and analysts (and many SI posters) but do the math - AMD and NSM/Cyrix are barely selling 2 million CPUs/quarter combined. I've seen estimates AMD will ship 4 million CPU's in Q4. What are your estimates? 3. Intel is the ONLY x86 supplier THAT MAKES A PROFIT IN THE SUB $1000 PC arena. Again, were these mainly Pentium socket7 devices? What do you think slot1 devices in this segment will do to margins? How many sub-0's do you think Intel will support in Q4? 4. Intel's technology advances will permit future competitiveness in the sub $1000 area - 0.18 micron process development is nearing completion and 0.18 micron Pentium II devices are being designed - CopperMine. How do you think these processes will impact the high end? If we get ever increasing performance at ever lower prices, how will Intel increase it's ASP's in the PC segment? So, abandoning a profitable business to allow a competitor to make more money is a dumb business decision. Intel will stay in the market, make money in that market (at lower margins), and insure that NSM/Cyrix and AMD make little or no money - and have difficulty investing in future technology. By staying in the market, (sub-0's) is it fair to assume (with all the technology improvements), that this segment will continue to displace the mid to high end for some time to come? When do you think this strategy will pay off for the investor, (higher share price?) gene