Intel drops prices of quad-core desktop chips

Price drops come ahead of the release of Nehalem chips

Intel dropped prices of some quad-core desktop processors on Sunday as it gets ready to launch processors based on the new Nehalem chip architecture.

The price cuts come ahead of Intel's plans to launch new quad-core chips code-named Lynnfield later this year, perhaps as early as September. Lynnfield chips are based on Intel's latest Nehalem microarchitecture, which cuts down on performance bottlenecks that plague its current chips. Nehalem chips are also able to execute more tasks while drawing less power.

An Intel official last week said that Lynnfield chips were on track for production in the second half of 2009, but didn't provide an exact shipment date. The company released Core i7 chips based on Nehalem for high-end desktops late last year, but those chips go into workstations and specialist systems built for enthusiasts like gamers.

Intel also plans to release quad-core laptop chips for laptops code-named Clarksfield at the same time as Lynnfield's release. However, the price for mobile chips remained stable over the monthly pricing cycle, according to Intel's price list.

Prices were cut on many Core 2 Quad processors that go into mainstream desktops. Prices for Core 2 Quad Q9400 and Q9300 went down by around 14 percent from $US213 to $US183. The chips come with 6MB of L2 cache and run at 2.66GHz and 2.5GHz, respectively. Prices for the slower Core 2 Quad Q8400 and Q8300 chips dropped by around 11 percent, while prices for low-power Core 2 Quad Q9400 and Q8400 chips dropped by 12 percent and 13 percent, respectively.

Some of the largest price drops were recorded by dual-core chips for low-end desktops. Prices dropped by 19 percent for Celeron E5100 chips, which runs at 2.2GHz and includes 512KB of cache, from $US53 to $US43. Prices for Core 2 Duo E7500 chips, which runs at 2.93GHz and includes 3MB of cache, dropped by 15 percent from $US133 to $US113.

The new price list was issued just a few days after Intel announced its financial results for the second fiscal quarter of 2009. During an earnings call, Intel CEO Paul Otellini said the PC market segment was showing signs of stabilizing, which could improve the company's chip business in the upcoming quarters.

However, Intel's chip revenue fell during the second quarter. Revenue from chips that go into servers, desktops and workstations was $US3.4 billion, down from $US4.1 billion a year earlier. Revenue from chips used in laptops and other mobile products was $US2.55 billion, a drop from $US2.74 billion last year.

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