Intel will cut the prices of its Pentium II processors at the end of January, once again prompting speculation that it is seeking to capture a Christmas market at a premium price.
A source close to Intel said today that at the end of January, Pentium IIs will be positioned as entry level processors - meaning that people who buy before Christmas this year will be see their systems crash in price just weeks later.
He said: "There will be a major price adjustment at the end of January and the next one will be at the end of April. The first quarter prices will be very aggressive and part of a plan to ramp the PII. It will really position the PII at every level of the marketplace."
He said that, while Intel will sell MMX processors in the first quarter of 1998, at that point sales will tail off as the processor becomes obsolete.
He added that Intel was set to introduce a Pentium II processor in a scaled down format, which will fit into NetPCs. "It will make the package very small," he said. The idea is to ensure that Intel can deliver the form factor that PC manufacturers want to compete with the NC platform.
An Intel representative said that her company was unable to comment on its future plans.
Last week Intel, as earlier revealed on 'VNU Newswire', further slashed its PII prices. It has also started a fierce advertising campaign here in Europe to promote the Pentium II as the games machine 'par excellence'.
That campaign was originally started in the US and then moved to other regions.
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