Intel on Budget CPUs

The war on high prices

Today, high-powered microprocessors are simply getting cheaper and cheaper. In fact, it's reached a point where the distinction between high end and low end is indistinguishable from a performance perspective. What does this mean? In Intel's "good old days," a flagship processor line such as the Pentium III would be so profitable (due to its performance over the old generation) that the company would all but drop its prior CPU lineup, ceding the market to the likes of AMD and Cyrix, who fell by the wayside with last generation's wares.

Now, it seems like the tables have turned. The inventor of the microprocessor is now being assaulted on the high-end front, as AMD readies their powerful Athlon (formerly known as the K7) processor for launch. AMD is so confident about the performance of the Athlon that internally they aren't even positioning it Intel's flagship Pentium III. Internal AMD projections show the Athlon vying against Intel's next-generation Willamette, the processor AFTER their new Coppermine technology (which has yet to be released). Realistically, we'll see Athlon and P3 battling it out, but the picture is clear - the high-end monopoly is over.

Decoy attack

Of course, the clincher is on the other end of the spectrum. PC prices have dropped so dramatically that almost anyone who really wants one can afford one. The sub-$1000 and sub-$700 PC market is so hot it simply can't be ignored. Intel countered AMD's penetration into this market with the Celeron budget processor, but in the process has had to introduce faster and faster chips in order to compete efficiently in this arena.