Edging Downward

Almost two weeks ago, we wrote about AMD pricing.

Let’s see what’s happened to the low U.S. Pricewatch price for the lower end of AMD’s Hammer line since then:

Prices have generally remained even, with a few significant drops.

What is intriguing is that while there are signs that prices are slipping a bit for retail Athlon 64s, the real price volatility is showing up at the OEM level, and most of that is occurring in one retailer: Monarch Computer.

If you compare OEM to retail prices there, you’ll see huge gaps in pricing. Retail chips cost $30, $40, $45, even $65 more than OEM chips.

In comparison, if you look at Newegg’s prices, the price gap is usually in the $10-20 range, which is about what you’d expect. What is more interesting is that most of the reduction is due to Newegg charging less for retail chips than Monarch (with the remainder being a bit higher prices for the OEMs)

Is Monarch getting CPUs from the gray market, most likely from real OEMs shedding excess chippage? It would appear that way.

From the consumer’s standpoint, there’s nothing wrong with that, but what does that say about OEM sales, especially in light of reports that CPU sales in general are weak.

On the whole, AMD’s prices on the lower half of the A64 spectrum are now about 10-20% less than the official retail price, with the percentage off going up as you head downward.

In contrast, Intel prices seem to be holding close to official pricing.

What Does This Mean?

To be honest, I don’t know. 🙂 Will others join this bandwagon? Is AMD simply responding to under-the-radar moves by Intel among the OEMs? We’ll just have to keep watching.

Ed