AMD thrashes Intel at low end

Will thrashing continue above the bottom line?

A survey released by PC Data late Friday has shown the extent to which Intel underestimated the nature of the PC market. But Intel senior executives know they miscalculated. At Intel's Developer Forum last week, both Paul Otellini, senior VP of IA architecture, and Pat Gelsinger, GM of Intel's desktop products division, said they had miscalculated at the low end. According to PC Data, AMD's share from November to January rose to 33 per cent in the $1,000 to $1,500 market. It had previously held around a third of the sub-$1,000 sector. Now AMD is positioning its K6-III processor against the recently released Pentium III, with benchmarks, such as those posted on Tom's Hardware Page last week, showing there is merit to its argument. Compaq will use AMD's K6-III, as will Gateway. Intel says the sweet spot for performance machines is currently just under $2,000, but that is likely to change. That will mean Intel is likely to step up future product announcements. Its 550MHz Pentium III part will be released in May, and price cuts on the new Pentium III processors is likely to be accelerated, sources said. (Story: Intel ships PIII, slashes PII prices) Later this year, AMD will introduce its K7 slot processor, which is also aimed at capturing Intel market share. Intel still owns the lion's share of the x.86 market, with an estimated 75 per cent market share. But it is also under pressure from the Alpha platform. Last week, the Alpha consortium cut its prices to compete with x.86 parts. ®

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