Christmas CPU Pricing

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As I mentioned on the front page yesterday, Intel already had an October 28th price cut scheduled. As expected, AMD will do the
same around the same time.

Now the Inquirer says it will present some more details on that price cut later today, but if the pre-September 11 roadmaps hold true, any significant price cuts will occur on high-end products that are not
competing with AMD price-wise, anyway.

Normally speaking, neither CPU company likes to change pricing over the Christmas selling season (though this has hardly been a “normal” year with stealth price cuts left and right). Intel’s original roadmap indicates that they would much rather
keep any price cutting modest (remember that Intel will have Northwoods out very shortly after October 28 to take up the high end of the price range.)

This brings us to AMD.

AMD’s initial official pricing clearly indicates that they would like to price Athlon XPs based on their PR rating. For example, they want the price of an Athlon XP 1800+ to more or less correlate to the price of a PIV 1.8GHz CPU.

This would mean a price of $250-275, going down to about $230 in November.

There’s two factors which make it unlikely they’ll get that pricing throughout Christmas season:

AMD has never gotten price parity with Intel recently. They weren’t able to do so the past year; a discount of 33% or a bit more has been more like it.

Add to that the dubious notion that AMD is looking for price parity based on a PR rating rather than actual MHz, and it’s really tough imagining a $200+ price lasting through the rest of the year.

Intel could slash the 1.8GHz PIV price Intel could add to AMD’s misery simply by cutting the 1.8GHz price a bit more. Fairly shortly, they’ll have four processors from which they can charge a lot, the 2.0/2.2Ghz Northwoods and the 2.0/1.9Ghz “oldies.” Cut the price of
PIV 1.8GHz an additional $30 or so, and AMD could well find themselves with a price structure not appreciably higher than it is now.

AMD’s Counterresponse?

The only near-term move AMD can make only works IF PR works to some degree and IF they can get higher-speed XPs out soon.

The most conservative XP plans I’ve seen indicate a maximum 1.733GHz chip. Presuming AMD can do at least that, we would then most likely see:

  • 1900+: 1.6Ghz
  • 2000+: 1.67GHz
  • 2100+: 1.73GHz

    Unless Intel really wanted to get into a bloodbath, AMD should be able to get some decent prices for such CPUs over Christmas.

    If AMD has a top-secret October surprise, that’s what it’s going to be.

    Those are two pretty big “ifs” though. OEMs don’t like new products being introduced after October; it interrupts their Christmas selling. If AMD isn’t capable of putting such chips out now; it might as well wait until 2002.

    If people and pricing focuses on actual MHz rather than PR, putting these out will do little good since Intel already has low pricing on this speed range.

    Overclockers Can Provide A Clue

    If we find out next week that we can overclock these things to close to 2GHz without extreme measures, we may see those high-speeders fairly shortly, presumably in late October.

    If we find out next week that we can only get closer to 1.7GHz out of them, again without extreme measures, AMD doesn’t have the goods yet.

    What To Do

    If your plans are to buy a 1500+ (1.33GHz) and overclock it, you’ll obviously pay a premium for being the first kid on your block with one, but after the initial rush, I doubt you’ll end up paying a whole lot more than if you waited things out.

    If your plans are to buy an 1800+ (1.53GHz) though, you’ll probably be kicking yourself by the time the Thanksgiving turkey shows up if you buy right away. If I had to bet today, I would bet that 1.53GHz will be south of $150 by around turkey time.

    Could be wrong, but I think this more likely to happen that not.

    Email Ed

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