Chip prices fall at AMD

Advanced Micro Devices cut prices over the weekend on some dual-core desktop processors and Turion mobile processors, bringing them more in line with the prices of some Intel chips.

It's now cheaper to buy AMD's top five Athlon 64 X2 processors as well as the company's Turion ML notebook processors, if you're shopping in quantities of 1,000 processors. The Athlon 64 X2 4800+ received the biggest discount among the desktop chips, moving from $803 to $643 over the weekend. The Turion ML-44 also received a hefty cut, down to $354 on Monday from $525 last week.

The list prices are only a rough guide, as PC vendors typically negotiate their own prices, and enthusiasts pay different prices for boxed processors.

An AMD representative confirmed the pricing changes, but declined to comment on the reasons behind the moves. "We schedule price moves as required by the market," the representative said.

The price discounts come one week after Intel and AMD painted two very different pictures of their fourth-quarter performance. AMD reported strong sales of its processors across all segments, while Intel said poor demand for desktop PCs, coupled with inventory problems, were to blame for a revenue shortfall.

Coming off Intel's news, some analysts had expected the stirrings of a price war in the processor market. AMD's cuts did not reach its low-end desktop processors, suggesting that pricing pressure only exists in the mainstream part of the market for now, Hans Mosesmann, an analyst with Moors & Cabot, wrote in a research note published Monday.

Chip companies tend to assign fixed pricing levels to their products and then move older products down the ladder as more powerful ones are introduced. AMD did not launch any new chips on Monday, but it is expected to unveil dual-core Turion processors during the first half of 2006, and Mosesmann had thought AMD was to introduce the Athlon 64 X2 5000+ on Monday.

AMD is also still charging a premium for its dual-core chips, compared with its single-core models. When Intel introduced its Pentium D processors last May and its Core Duo chips earlier this month, it priced those chips in line with its most powerful single-core models, essentially giving buyers an extra processor core at no charge.

AMD chose to charge more for the dual-core chips when it debuted them last May, arguing that since overall performance was going up dramatically, the chips were more valuable. But those prices have come down quite a bit since they were first introduced to become more competitive with Intel's pricing, if still a little more expensive, Mosesmann said.

[Jonathan]

The X2's are still too expensive.

I'm looking at upgrading but those X2's are still freaking expensive. Wake me when the midrange chips fall below $300.

[Neo Con]

Also too slow

I wouldn't get on board with this first generation of dual-core processors anyway, even when the price goes down. They (both Intel & AMD) don't use their caches correctly, resulting in slower performance. The next generation of dual-core chips will properly share both caches, increasing the overall processing speed tremendously. Wait for those to come out, otherwise you're not getting much more performance for the increased price of the second processor core.

[baswwe]

Get a job that pays

If you can't afford it, you ain't making enough.

maybe get another job pumping gas.

[Jonathan]

The X2's are still too expensive.

I'm looking at upgrading but those X2's are still freaking expensive. Wake me when the midrange chips fall below $300.

[Neo Con]

Also too slow

I wouldn't get on board with this first generation of dual-core processors anyway, even when the price goes down. They (both Intel & AMD) don't use their caches correctly, resulting in slower performance. The next generation of dual-core chips will properly share both caches, increasing the overall processing speed tremendously. Wait for those to come out, otherwise you're not getting much more performance for the increased price of the second processor core.

[baswwe]

Get a job that pays

If you can't afford it, you ain't making enough.

maybe get another job pumping gas.

[IanrJ]

The coming price war

I think a very aggressive price was is about to break out between Intel and AMD through 2006. Why do I think this? Well AMD got a jump on Intel late 2004 and thru 2005 with a roll out of faster chips which use less power. Intel realised this and scrapped expected future launches to rejig their entire line-up, which unfortunately lost them some Sales in the interim period. The new lower power, high performance 65 nm cpus will be rolled out progressively through 2006. And a full 64 bit line-up will be launched to coincide with MS's Vista launch. Since AMD have publically declared "war" on Intel, the latter is now free to use quite extreme pricing measures w/o fear of being accused of "uncompetitive practises". i.e. AMD have made a made tactical error opening this door. So it seems to me that as the new Intel ranges are launched they WILL begin to underprice AMD's equivalent most aggressively. They (Intel) will need to regain lost market ground and perfomance, lower power untilization and excellent pricing is the ONLY way to do this and also to keep their OEM's happy. Why does one think Apple moved to Intel and not AMD? Surely because Intel assured them they would be totally competitive in 2006. Intel can afford such a price battle because the one thing they do best, is set up new fabs to produce the best yields asap. As both AMD and Intel ramp up to 65 nm the price and value/performance will be great for the consumers and the best fab manufacturer will win. My bet's on Intel to win back lost ground through 2006 and into 2007 as I don't think AMD's yields or margins will equal Intel's.

[IanrJ]

The coming price war

I think a very aggressive price was is about to break out between Intel and AMD through 2006. Why do I think this? Well AMD got a jump on Intel late 2004 and thru 2005 with a roll out of faster chips which use less power. Intel realised this and scrapped expected future launches to rejig their entire line-up, which unfortunately lost them some Sales in the interim period. The new lower power, high performance 65 nm cpus will be rolled out progressively through 2006. And a full 64 bit line-up will be launched to coincide with MS's Vista launch. Since AMD have publically declared "war" on Intel, the latter is now free to use quite extreme pricing measures w/o fear of being accused of "uncompetitive practises". i.e. AMD have made a made tactical error opening this door. So it seems to me that as the new Intel ranges are launched they WILL begin to underprice AMD's equivalent most aggressively. They (Intel) will need to regain lost market ground and perfomance, lower power untilization and excellent pricing is the ONLY way to do this and also to keep their OEM's happy. Why does one think Apple moved to Intel and not AMD? Surely because Intel assured them they would be totally competitive in 2006. Intel can afford such a price battle because the one thing they do best, is set up new fabs to produce the best yields asap. As both AMD and Intel ramp up to 65 nm the price and value/performance will be great for the consumers and the best fab manufacturer will win. My bet's on Intel to win back lost ground through 2006 and into 2007 as I don't think AMD's yields or margins will equal Intel's.