News.com meldt - in een artikel over het Intel en AMD prijsfestijn van gisteren - dat analisten in de nabije toekomst, wanneer Intel in staat is om de snelle PIII's in grote volumes te leveren, nog veel heftiger prijsverlagingen verwachten:
Today's price cuts are fairly typical, said Kevin Krewell, senior analyst at MicroDesign Resources. However, more aggressive cuts are expected in the near future because Intel will be producing more chips and making up lower prices through volume sales and even faster processors. Intel is currently holding a conference with its sales and marketing executives in San Francisco.
"When we get to the second quarter, it is going to get worse, because Intel will have a boatload of products out there," Krewell said. "Then you are going to see some serious fights."
How deep the cuts go will be anyone's guess. Some analysts have theorized that Intel can't cut Pentium III prices too drastically because it would hurt profit margins. Last year's price war in the low end was largely subsidized by the more expensive Pentium III. Intel has also been saddled with chip shortages, because it has been releasing processors with less volume than in the past.
Nonetheless, Intel is a long way from the bottom line. The Pentium III costs approximately $39 to make, package and test, according to estimates from MicroDesign Resources.