Intel cuts prices 50% on Pentium 4

Tuesday August 07 by Ron Jarvis
Intel Corp. plans to slash prices on its Pentium 4 chips by more than 50%. The move shocked many on Wall Street after comments by Intel CEO Craig Barret that the PC industry had bottomed out. The move was made in order to try to recoup some of the share gained by rival AMD.

With Advanced Micro boosting its market share even as PC sales drop industrywide, Intel is chopping prices to spur consumer and corporate demand for machines running on Pentium 4s, its newest chips. Intel wants to be selling more Pentium 4s than Pentium IIIs for desktops by the end of the year and has said it wants PCs with the new chip to sell for as little as $799.

The company may reduce the cost of its top 1.8 gigahertz Pentium 4 to $260 from $562 this month, Niles wrote. The price for a 1.7 GHz Pentium 4 will fall 45 percent, with low-end models dropping 30 percent to $135, he said. Pentium 4s, introduced in November, will move up to 2 GHz in the fourth quarter, he said.

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