Intel price cuts boost PII over Celeron

As predicted here last week (Intel, AMD and Cyrix to feature in price cut blizzard) the Intel price cuts implemented today push higher performance Pentium II chips further into the mass market, and indicate a certain de-emphasis on Celeron. Several lower speed chips are no more, and although there is still some price advantage for Celeron, the gap between the 'Basic PC' line and PII has narrowed. Intel, which has seen PII-based machines obstinately succeed in price-sensitive markets while Celeron's performance has been somewhat less glorious, takes it on the chin by explaining: "Continued strong acceptance of Pentium II processors enables Intel to strongly ramp these products into higher volume price points." Loosely translated, this means the manufacturers and the market have decided they want PII rather than Celeron, so Intel has decided to give in a little. The biggest cut implemented is 30 per cent on the 350MHz PII, to $213. The 333MHz, which is the new entry level, is down 23 per cent to $181, and the 400MHz and 450MHz down 22 and 16 per cent respectively, to $375 and $562. So Intel clearly still thinks it can keep clear blue water between the lower end PIIs and the fastest. The Celeron 333MHz 128k cache version loses 17 per cent to $159, while the 300AMHz only 7 per cent to $138. Celeron is therefore being positioned for markets of extreme price sensitivity where running Intel is still essential, i.e., pretty narrow ones. It's at least arguably that Intel is still trying to figure out its low-end strategy. The PII Xeons also had cuts, the 400MHz with 1Mb cache down 30 per cent to $1,980, and the 400MHz with 512k cache down 27 per cent to $824, which is the same price as the 450 MHz version of the same chip. There were no cuts on the PII and Pentium mobile modules, where Intel must feel pretty secure still. (R) Click for more stories