Intel cuts chip prices

SAN FRANCISCO: Intel has cut prices on many of its processors used in laptops by between 10 percent and 38 percent. The price cuts, announced on Intel's website on Sunday, came ahead of the company's introduction of a new higher performance mobile processor. The Centrino package of chips, chip sets and wireless networking software for laptops is expected to be released sometime before July, it has said.

With its Pentium 4 Processor M, Intel dropped the price of its 2.20 gigahertz version by 38 percent to $348; its 2.0 GHz by 31 percent to $241; 1.90 GHz by 18 percent to $198; and 1.80 GHz by 14 percent to $171. With the Pentium III, the 1 GHz version was dropped by 24 percent to $241 and the 933 megahertz by 18 percent to $198.

Intel also dropped prices on some of its lower-priced Celeron processors for laptops. The 1.80 GHz version was dropped by 10 percent to $134; the 1.70 GHz by 16 percent to $112; and the 1.60 GHz version by 14 percent to $96.

The price cuts were not expected to lower the average selling prices of Intel's microprocessors as higher-margin products are rolled out, said Joseph Osha of Merrill Lynch.

It also won't necessarily spur sales, he said. "There's not much evidence that there's price elasticity of demand in this business right now."

© Reuters