AMD Pricing

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AMD’s unannounced drop in prices betrays fear it will have to price based on MHz. –Ed

Next week, Intel is going to be slashing prices on the lower-end PIVs. This should mean 1.5Ghz PIVs being priced somewhere closer to $100 than $150.

As an apparent preemptive move, AMD has pushed everything except the MPs at or below about $110. Never before in history has the fastest mainstream processor in the world cost $110.

It almost looks like AMD is hellbent to price its processors below that of the equivalent Mhz PIV.

Now this may be just a “clear the Tbirds out and make room for the Palominos” move, and AMD plans to charge a good deal more for the horsies.

But can they?

That rather depends on how enslaved the average person is to that MHz number.

Will the average person pay more for a 1.533Ghz Palomino system than a 1.7GHz PIV system?

I know you would; I know I would. We don’t matter in this equation.

We know the Palomino will be competitive and then some against at least any .18 Willy Intel will throw out.

But does anyone else? By that I mean the vast majority of those buying?

If they don’t, and they don’t learn fast, then Intel will have AMD by the short hairs.

Intel pricing seems to indicate that they’ll low-ball the prices on PIVs with MHz ratings comparable to those AMD has, and keep prices much higher on those significantly higher.

If AMD can’t sell a processor for more than the Intel price (and recent pricing seems to indicate the need for about a 30% discount), then unless they can get horsies running a good deal faster than they’ve been saying publicly, they’re going to be stuck with getting bargain-basement prices for their processors until they can move to .13 micron, or for at least six months.

Intel can keep sacrificing .18 Willys with cutthroat pricing to keep AMD down, and at least make some of it back with the .13 micron Northwoods. It’ll be a bloodbath for them, too, but they can stand it longer.

Of course, this strategy succeeds or fails based solely on the vast majority of buyers continuing to have a computer vocabulary of one word.

This should be a true test of how much influence those who know better have on those who don’t.

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