Intel to slash Pentium prices by 60%

[Al-khiyal]

Microchip heavyweight Intel is aiming to knock out rival AMD by slashing the prices of its older stock according to reports.

Intel spokesman Chuck Molloy told Reuters the firm will move quickly to reduce prices. "We have a more aggressive product and manufacturing ramp, so those older Pentium products will move down faster. It's not like we're cutting prices for the sake of cutting prices," he said

The microprocessor manufacturer has been trimming prices in recent months as it moves to clear inventories and halt market share gains by rival Advanced Micro Devices (AMD).

Executives at Micro-Star International and Gigabyte Technology, two of Taiwan's biggest makers of circuit boards for computers, told reporters that Intel officials are initiating price cuts in July. Prices for older Pentium chips are expected to be reduced by up to 60 percent.

Last quarter AMD increased its share of the USD35 billion computer chip market to more than 20 percent for the first time in more than four years. At the same time, Intel chief executive Paul Otellini forecast his company's first annual sales decline in five years, while world number one computer manufacturer Dell recently decided to buy some AMD chips - breaking Dell's previously exclusive reliance on Intel processors.

Intel, which makes about 80 percent of the processors found in all personal computers, has introduced new manufacturing techniques to etch circuits as small as 65 nanometres - a width that is less than 300 atoms across and more than a quarter thinner than the previous generation of chips.

The smaller chips are reportedly more energy efficient and powerful, but also more profitable for semiconductor companies because more can be cut from a single slice of silicon.

The expected Pentium price cuts will allow Intel to get rid of old stock quickly so it can concentrate on selling its new top-of-the-range chips called "Core".

Woodcrest, the server version of the Core 2 Duo lineup, will be the first to arrive later in June, according to the company. Conroe, the desktop version, will arrive in July, while Merom, a notebook chip, will follow in August.

It is hoped that Intel's price cuts will drive down the price of personal computers.

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[phylay]

This is funny coz AMD who had the cheapest micros decided a few months ago to increase their prices so that the consumer thinks they are of the same quality as Intel's (the rule being the most expensive is probably the best).
Seems their strategy worked!

[lazzhar]

The thing about Intel vs AMD is that they are always pushing each other. AMD is always following steps of Intel without intentions to venture and innovate except trying always to beat speed of Intel's cheapsets.
This is what happens when there is no real competition and one giant is dictating what others have to do.