PC market slows ahead of anticipated Intel price cuts
It could trim prices as early as next month
IDG News Service - Users looking for a new PC might want to wait for a round of price cuts that are expected soon from Intel Corp., the world's largest maker of microprocessors.
Component vendors and analysts in Taiwan say the company may announce such reductions in July, and the PC market has already slowed in anticipation of the move. The microprocessor is one of the most expensive parts inside a PC, so price reductions could have a big impact on the cost of an overall system.
Taiwanese companies often have inside information about the PC industry, such as upcoming chip launches or price reductions, because they make many vital components for PCs and need to know about upcoming technical or business changes in order to prepare new products. Taiwanese companies hold over three quarters of the global market for computer motherboards.
Intel announced its most recent price reductions on June 4. It regularly updates its price lists because older processors usually fall in price as it introduces newer ones.
The company said it hasn't made any formal announcements about a price reduction in July. "There has been no announcement, but I believe everyone has speculated on that," said Nick Jacobs, a corporate communications manager for Intel. Intel is often the subject of rumors and speculation, he noted.
Whether the current talk turns out to be real or merely speculation, it has caused demand for a host of PC components, including memory chips and LCD (liquid crystal display) screen panels, to slow. That's because PC vendors don't want to have built up a backlog of PCs with more expensive processors if Intel is about to cut prices.
"Overall DRAM demand remains minimal, as PC demand has been postponed since Intel had foretold its July price reduction," said market researcher DRAMeXchange Technology Inc, in a report yesterday.
Meanwhile, prices of LCD panels used in laptops and desktop monitors fell by 3% to 5% in the second half of June, according WitsView Technology Corp.
A reduction in microprocessor prices could produce bargains for users looking for a new PC. Lower prices could allow PC makers to pass the savings directly on to users, or enable them to add more goodies to a PC, including more memory, a larger hard drive or a flat display screen, without increasing the price of the system.
Part of the reason people believe Intel will slash prices is the stiff market competition with rival Advanced Micro Devices Inc. (AMD). The two companies have been in a pitched battle over the past year, with AMD gaining some market share on its rival and even winning a key new customer, Dell Inc. The world's largest PC maker once exclusively used Intel microprocessors, but recently announced it would use AMD processors in some servers.
Another reason Intel might cut prices would be to make way for its upcoming family of powerful and more energy-efficient Core 2 Duo microprocessors, said one component maker. As the company releases new microprocessors, it usually slashes prices on older models in order to clean out its inventories.



- Excel 2010 Cheat Sheet
- Register for this Computerworld Insider Cheat Sheet and gain access to hundreds of premium content articles, guides, product reviews and more.
- The Laptop Dilemma: How to Maximize Productivity and Lower the Burden on IT
- Download Now
- Overcome Top 7 Admin Challenges of Active Directory
- As Active Directory's role in the enterprise has drastically increased, so has the need to secure the data. Gain insight on creating repeatable,...
- Insiders Can Ruin Your Company. Take Action.
- Did you know that 80 percent of threats to an organization come from the inside? The threat from insiders is often overlooked in...
- Top Solutions and Tools to Prevent Devastating Malware
- Custom malware frequently goes undetected. According to Forrester Research, the best way to reduce risk of breach is to deploy file integrity monitoring...
- Streamline Compliance and Increase ROI
- Streamline, simplify, and automate compliance related activities; especially those that impact multiple business units. This white paper from NetIQ, outlines solutions that will... All Hardware White Papers
- Optimizing Networks for the Cloud
- Join guest speaker, Rohit Mehra, IDC Director of Enterprise Communications Infrastructure, to explore current trends, discuss best practices for optimizing Data Center and...
- Apps QuickStart Series Part 2: Designing and Deploying SQL Server on VMware vSphere
- Download this webcast to learn about the design considerations for virtualizing SQL workloads, performance and scalability information and high-availability options, as well as...
- Apps QuickStart Series Part 1: Designing and Deploying Exchange 2010 on VMware vSphere
- Download this webcast to learn the virtual hardware design considerations for Exchange 2010, deployment using the building block approach, options for high-availability and...
- Customer Spotlight: How IPC The Hospitalist Company Implemented Oracle on VMware
- Have you been looking to hear about customer's experiences with the new VMware vCenter Site Recovery Manager product? View this webcast to learn...
- Virtualize Business-Critical Applications with Confidence
- Virtualizing business-critical applications has become a key focus for organizations as they move along their virtualization journey. With the launch of VMware vSphere®... All Hardware Webcasts