Chip Price War On The Verge

Chip Price War On The Verge


With the impending release of the Core 2 Duo processor, formerly code-named Conroe, on the heels of the successful Xeon launch, the chip maker's products are generating a new kind of buzz. It's the same kind of anticipation that was a given several years ago, before rival Advanced Micro Devices hit the scene with technology impressive enough to turn heads of corporate buyers and enthusiasts.

"It's been a long time since people have been talking about Intel the way they have been talking about them for the past few months," said one system builder, who requested anonymity. "For so many years, Intel had been king of the mountain and nobody wanted to talk about AMD, but for the past three years that has flipped."

For example, Todd Swank, director of marketing at Nor-tech, a system builder in Burnsville, Minn., said Nor-Tech is particularly enthusiastic about Intel's Core 2 duo's price/performance story.

With the launch slated for July 27, Intel, Santa Clara, Calif., said it has priced the chips aggressively and also reduced the older dual-core
Pentium D prices to as low as $93 for the value PC space. "It is Intel's turn to be in the driver's seat," Swank said.

Many system builders said they have no plans to immediately promote the vPro platform—which adds remote management features, virus protection and virtualization—along with the Core 2 Duo, focusing instead on the price/performance story.

But David Stinner, president of US itek Group, a system builder and MSP in Buffalo, N.Y., said he will integrate the technology into a managed services practice. "We want to have vPro platforms in place with our business customers by the end of the year."

Despite their excitement for Intel's newest product, many system builders said AMD is still very much in the game. Pat Moorhead, vice president of AMD's Global Channel Marketing, Microprocessor Solutions Section, said the Sunnyvale, Calif., chip maker is not concerned about Intel's latest desktop option.

"We are raising the bar, and they are playing catch-up," he said, adding AMD will be releasing higher-performing desktop CPUs in time for the holidays.

System builder sources said AMD already has offered additional discounts through distribution and plans to unveil price cuts July 23.

AMD confirmed to CRN that it "will perform an aggressive price move in July to ensure we maintain price-performance leadership in desktop products."

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