As expected, Advanced Micro Devices Inc. yesterday cut the price of its Athlon and K6-2 desktop microprocessors to keep pace with rival Intel Corp.
The move follows price reductions by Intel, which Monday cut its Celeron and Xeon chips by about 20%, and its Pentium III line by as much as 29%.
AMD's reductions were closely modeled on Intel's in scale. The company cut its 800-and 750-MHz Athlon prices 25% and 29%, respectively, to $599 and $489. AMD also slashed its midrange 700- and 650-MHz Athlon tags to $389 and $299, respective reductions of 25% and 23%. The low-end 650-MHz Athlon also was cut 21%, down to $229.
One Athlon processor AMD did not discount was the company's latest 850-MHz chip, which boasts a clock speed Intel has not yet matched. For now, AMD is shipping the 850-MHz device for $849, unchanged from its introduction earlier this month.
In a hypothetical transaction where AMD and Intel both held to their prices and refused to negotiate volume discounts, an Athlon would sell for about a 7% discount compared with a Pentium III at a similar clock speed. That discount is relatively constant compared with the companies' early February pricing schedules, save for a significantly narrower 1% difference for processors clocked at 550 MHz.
AMD saved the most dramatic discounts for the inexpensive K6-2 line, possibly to fight off the reemergence of Via Technologies Inc. and its Cyrix III processor, according to observers. The fastest 550-MHz K6-2 was left unchanged at $189, while AMD cut the 533-MHz chip by 24% to $127. The 500-MHz version plunged 39% to $93. The 475- and 450-MHz parts slipped a more modest 20% and 10%, respectively, to $79 and $71.
At those prices, AMD's 500- and 533-MHz K6-2s match Intel's equivalently clocked Celeron chips. Because AMD's 450- and 475-MHz K6-2 chips are clocked higher than Intel's 433-MHz and 466-MHz Celerons, the company has retained a nominally higher price.