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

To: Paul Engel who wrote (74706)	2/27/1999 5:10:00 AM
From: puborectalis	Respond to of 186894

Intel Pentium III Processor Makes Its Debut Blazing Speed and a Bevy of Critics Shouting 'Invasion of Privacy' By JERI CLAUSING nder a growing cloud of controversy about an embedded identification number -- and in the face of the most competitive market the Intel Corporation has faced -- the company's powerful new microprocessor, the Pentium III, began appearing on store shelves Friday in computers priced as low as $1,599. The lowest prices ever for first shipments of computers based on a new Intel processor reflect both cost cutting across the hardware sectors and Intel's struggle to keep pace with rapid price cutting in the industry. Intel, which has dominated the microprocessor market since the introduction of the I.B.M. PC in the early 1980's, is now faced with tough competition from competitors like Advanced Micro Devices, whose AMD microprocessors are slowly but steadily capturing a growing share of the market dominated by Intel, analysts said. In fact, January data released Friday showed that for the first time, desktop computers running AMD processors, which are about 25 percent cheaper than Intel's, outsold machines running chips from Intel in the United States. The results were compiled by PC Data of Reston, Va., which collects point-of-sale statistics on software and hardware sales. AMD-K6 processors, roughly equivalent in power to Intel's Pentium II line, accounted for 43.9 percent of all sales in January, compared with 40.3 percent for Intel and 15.8 percent for the National Semiconductor Corporation's Cyrix processors. AMD, whose gain was largely the result of a 180 percent jump in the sale of computers priced under $1,000, has recently made significant inroads with major computer makers. Among the top 10 manufacturers, all but Dell use AMD processors in at lease some of their product lines. "That AMD has captured at least part of the product line is an impressive accomplishment," said Michael Slater, an industry analyst and executive editor of the industry newsletter Microprocessor Report. "But they are only used in a portion of their products. That's their big challenge now -- not to gain more PC makers as customers but to proliferate more widely in the lines of companies that are customers." Still, worldwide, Intel dominates 80 percent of the microprocessor market and continues to set the industry standard in new technology. Like previous generations of Intel chips, the Pentium III represents the pinnacle of personal computing power, with innovations that improve not only the computer's speed but its multimedia capabilities. The first models of the Pentium III run at speeds from 450 to 500 megahertz. Intel said it was committing a $300 million budget to market the new chip. That is twice its most expensive marketing effort to date -- the rollout of the Pentium MMX, which introduced embedded multimedia capability. Release of the Pentium III, however, has been marred by controversy over its processor serial number. Though Intel has touted the feature as an advance for security in Internet commerce and for authenticating e-mail and other documents, privacy and consumer groups protest that it will allow marketers and others to surreptitiously track the movements of computer users around the Internet. When the chip was announced, the Electronic Privacy Information Center and two other privacy groups launched a boycott of Intel and began lobbying the Federal Trade Commission and computer makers, demanding that the feature be eliminated. Intel responded by enabling computer makers to ship Pentium III machines for consumers with the feature turned off. But questions remain about whether hackers or other third parties could turn the feature back on without a user's knowledge. And yesterday, the Center for Democracy and Technology, the Privacy Rights Clearinghouse and Consumer Action filed a complaint with the trade commission charging Intel with unfair and deceptive trade practices. The complaint asks the F.T.C. to enjoin Intel from shipping any more of the chips and asks it to prevent computer makers from shipping equipment with the chip unless it has been securely disabled. The complaint also asks that the agency investigate Intel's decision to use the technology. Because Intel dominates the microprocessor market, the Pentium III's serial number "has the potential to change the Web experience to one where every move is virtually recorded," said Deirdre Mulligan, a lawyer for the Center for Democracy and Technology. An Intel spokesman, Tom Waldrop, said the company had been meeting with privacy advocates to address their concerns, but he added, "We do not believe that there is anything deceptive or unfair regarding our activities." An F.T.C. spokeswoman, Vicki Streitfeld, said the agency would "seriously review" the complaint. As for what impact the privacy debate might have on sales of the Pentium III, Slater said: "It creates a certain amount of turmoil, and it's going to require some reactive effort on Intel's behalf. But I don't think it changes the nature of the landscape. My guess is that it will be largely irrelevant." Jeri Clausing at jeri@nytimes.com welcomes your comments and suggestions.

To: Paul Engel who wrote (74706)	2/27/1999 9:30:00 AM
From: t2	Read Replies (1) \| Respond to of 186894

Why did Intel fall? Due to Compaq downward earnings revision? That is the only thing that makes some sense. However, Compaq, HP, IBM are the ones that sell a lot of the cheap PCs. I have not heard any bad news from Gateway or Dell--expect that maybe the revenues slowing to due price competition. The price of the chips is not being slashed even though PCs might get cheaper due to severe competition. In fact we might see a lot of buying due to price reductions. In addition, all those that want the latest and greatest are going to buy a lot of PIII computers. Sorry I don't consider the new AMD chip as the latest and greatest in the eyes of the consumer who is looking for a high end PC. Maybe the tech junkies think AMD is comparable on the high end but not the consumers who get bombarded with all those Intel commercials. JMHO