Intel slashes chip prices for holiday season

Intel has lopped up to 41 per cent off the price of its desktop processors, part of an effort to make PCs that house its chips more attractive as the holiday buying season approaches, a company spokesman said yesterday.

Intel regularly cuts prices on its processors to make way for faster products and in response to changes in the PC market. However, the price cuts announced yesterday go deeper than recent reductions.

The price cuts follow closely the release of desktop systems based on Advanced Micro Devices' new Athlon processor, which has received glowing reviews from many analysts. Intel said its price cuts are unrelated to the launch of AMD's new chip, and were disclosed to PC makers a month ago -- before Athlon began shipping.

The price cuts "are designed to help our customers position our product for the upcoming buying season," Intel spokesman Seth Walker said. Reductions in PC prices typically translate into lower PC prices for buyers.

The deepest cut is on the Pentium III at 500MHz, whose price plummeted 41 per cent from $US423 to $US251, Intel said. All prices given are for 1000-unit quantities. The changes were effective yesterday.

The price of the 600MHz Pentium III, released at the start of the month, remains unchanged at $US669. The 550MHz Pentium III dropped 26 per cent to $US487, down from $US658; while the 450MHz Pentium III dropped 20 per cent, to $US183, Intel said.

In its Pentium II family, used in lower-priced desktops, Intel dropped the price of a 450MHz Pentium II 20 per cent, to $US183; while the 400MHz Pentium II is now priced at $US163, a drop of 6 per cent.

Prices for Intel's Celeron, mobile and Pentium III Xeon chips remain unchanged.

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James Niccolai

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