Reports that Intel cut prices of its i740 graphics chips to less than cost, swamping the market, were firmly quashed by the company today.
But Intel admitted it had reduced the price of the parts earlier this year.
Rivals claimed Intel was dumping the i740 into the already weak market, with prices ranging between $7 and $26 when bought in batches of 1,000. That had made it hard for specialists like 3Dlabs to compete, forcing them to reduce their prices too, said reports.
Intel said that it lowered the price of the i740 in March from $34.75/1,000 to $28/1,000. A representative said: "We haven't changed the price at all since then. We are not selling it below cost. Intel does adjust pricing according to volume but not at the expense of making a profit."
The chip industry's trends have a knock-on effect on the graphics card market, already severely depressed by the low cost of memory. High end graphics cards using the i740 part, and with 8Mbytes of memory, are selling out of Taiwan for as little as $40.
Intel maintained last week that it had no interest in the graphics market and was only a small bit player, in a reply to the US Federal Trade Commission, which is investigating it on antitrust charges.
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