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To: Paul Engel who wrote (6671)	6/23/1998 8:18:00 AM
From: Bill Jackson	Read Replies (2) \| Respond to of 6843

Paul, It is simple. All the commodities that Intel uses are stable in price and thus there is a cost plateau they now occupy. They are high enough in volume on all items that only incremental improvements can be made. They can improve yield but that does not affect costs of raw materials although it does impact profits. No Intel is dropping prices far faster than it's costs are dropping. Even the yield cost argument fails, as you have said that they are near perfect and thus only incremental yield increasesare possible. So when we get price decrements of 30-60% just after the competition has released threatening chip we cannot say "What a coincidence that they released this chip just as Intel cut it's silica cost by 60% by astute buying and ramped yields to 180% with it's new chip replicator" Cause effect. Intel has been gouging the consumer and was forced to respond by AMD's success. In addition they are trying to make a monopoly in the slot 1 fabrication scheme, a monopoly scheme that has now failed. And where do you get current Intel costs? Old boy network? Bill