Intel Slashes Prices, Adds New Chips To Lineup

disappointing fourth-quarter numbers

"We mainly focus on the quad-cores, the 9550 and 9650, so it really is helpful. It's nice to see that Intel is going to bat for partners like us," said Paschick, president of Rain Recording, a builder of high-performance desktop and mobile audio workstations.

Intel on Sunday cut the price for the 3.0GHz Q9650 processor by 40 percent, taking the top part in the Core 2 Quad family from $530 down to $316. The chip giant also dropped the price on its 2.83GHz Core 2 Quad Q9550 from $316 to $266, a 16 percent price cut. Other adjustments in that category included price cuts for the 2.66GHz Q9400 (20 percent, from $266 to $213), the 2.50GHz Q8300 (18 percent, from $224 to $183) and the Q8200 (16 percent, from $193 to $163).

Whether the price cuts have more to do with Intel's own inventory needs or some pressure from the well-received new Phenom II desktop processors from Advanced Micro Devices, Paschick said better deals on older product is more than welcome given current economic conditions.

"In this climate, mature technology is more attractive. As a system builder, as a manufacturer, even as a consumer, if you can help me make some cash by making use of things I have laying around, the more I love you. Everybody's having inventory issues and the herd is thinning everywhere you look," he said.

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Intel's newest family of processors, the first three Nehalem-class Core i7 chips released last November, continue to be priced at their initial levels, including $999 for the 3.20GHz Core i7-965 Extreme Edition. The top quad-core part from the older Core 2 architecture, the 3.2GHz Core 2 Extreme QX9775, is still the most expensive non-server/workstation chip in Intel's stable at $1,499.

Intel also cut prices for two Core 2 Duo parts, several Pentium and Celeron chips and the top four Xeon server processors in its X3000 series for 1p servers. The biggest price cut in percentage terms was the 48 percent reduction for the 2.26GHz Celeron 570 mobile processor, from $134 to $70.

The chip giant also quietly introduced, by way of its updated processor price list, several new energy-efficient processors manufactured at Intel's current 45-nm process node. These include three new 45 nm Core 2 Quad desktop parts designated with an "s" -- the 2.83GHz Q9550s (12 MB L2 cache, $369), 2.66GHz Q9400s (6 MB, $320) and 2.33GHz Q8200s (4 MB, $245).

Paschick also singled out Intel's new dual-core Pentium T3400, a 2.16GHz mobile processor released at the end of last year, as a very attractive alternative to equivalent Core 2 Duo chips in the $200 to $300 price range. The T3400 doesn't appear on Intel's new price list, but ChannelWeb found the processor available online for prices as low as $64.

"The pre-Core 2 dual-cores were excellent performers. The T3400 is debuting in our first sub-$2000 laptop, the Rain Recording Zephyr," Paschick said. The custom system builder has at least one notebook giant thinking the same thing -- Toshiba built its newly released Satellite L305-S5921 around the Pentium T3400.

Intel, which suffered a 19-percent sequential drop in revenues for the just-concluded financial quarter, is projecting a continuation of that trend in the current three-month period, according to executives. AMD, which has downgraded its fourth-quarter revenue expectations and laid off more than 1,000 employees in recent weeks, reports its Q4 earnings Thursday.